Mobile Commerce

Payments, Data The Key In Enterprise Evolution

The movement to cashless payments is having a seismic effect on the global payments system, according to a recent white paper by IDC, titled “Payment Platform: Enabling Enterprise Transformation Through Actionable Data.”

The key force driving the adoption of cashless transactions lies with the growing embrace of eCommerce, and the movement of the consumer to buy goods and services beyond his or her own borders. Key hallmarks of this shift, according to IDC, include Chinese companies expanding beyond their own home markets and the introduction and proliferation of e-wallets. But across all technologies, according to the research firm, the fact that consumers have been finding lower prices and a wider selection helps move eCommerce as a whole.

One notable trend has been the commoditization of the payments industry as a whole, posits IDC, with competition growing and pressure increasing on retailers to operate with an eye on efficiency and cost containment.

No surprise, then, that data grabs the spotlight, regardless of industry and size of player. As IDC notes, “businesses that accept payments sit on a gold mine of insights from customer transactions that can help them improve” everything from strategy to margins.

Yet firms lack the very technology that can help them make sense of this data deluge, and the best practices show that that “data governance,” as the research firm terms it, permeates every area of a firm.

Turning to the payments platform itself, IDC says that this critical engine is the last part of the customer journey and simply cannot fail at the last mile, i.e., checkout, leading, perhaps, to reputation and brand damage. An effective payments platform is speedy and links data across the point of sale, accounting and even inventory.

IDC also states that it is important to move beyond the simple single payments processor model, and instead adapt one that offers a new layer of technology that extracts data, residing between the retailer and the merchant acquirer; consider it a “smart router,” says IDC.  Against this backdrop a few benefits emerge as companies can keep merchant acquiring fees and other costs down especially as authorization requests can be sent to certain acquirers based on transaction types, with the effect of having all transactions converted to domestic ones, with the elimination of attendant fees. And in addition, greater transparency means better fraud control, with the retailer now able to decide whether and when to block certain transactions.

With proper, multi-layered technology in place, the data that can be captured can in turn be used to generate effective promotions and also strong returns on investment – customizing the consumer experience in real-time and also fostering competitive advantage.


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