Technology has its wow factor. But for independent software vendors (ISVs) and merchants — as with all stakeholders in payments — adoption is key beyond the bells and whistles of new products.
In an interview with PYMNTS, Bill Lodes, EVP of Business Development & Strategy at First American Payment Systems, said that some software companies are hesitant to embrace in-store payment solutions, even those with marquee status, such as Apple Pay and Samsung Pay.
This, he said, is because “they do not realize the power of payments and haven’t prioritized it in their development roadmap.” Barriers also exist when companies are smaller software vendors and may not have the resources in place to integrate robust payment offerings — undertakings that, on the surface, can be intimidating to smaller companies.
However, consumers are going to demand that such payments become available, he said, amid growing popularity of digital wallets, biometrics and peer-to-peer (P2P) payments. Ready or not, software companies and ISVs will have to have integrated payments solutions within their software.
Lodes told PYMNTS a tailwind may come in 2018, as companies start to look for dedicated partners to bring such solutions onto their platforms.
“Software companies aren’t experts in payments, so they need an expert that will provide the most innovative payments solutions that are easy to integrate,” said Lodes. “If the solution is hard to integrate or takes too long, it won’t be effective or impactful for the software company. Therefore, they need to perform due diligence on payment companies to ensure the product set and technology is a good fit for their software.”
In assessing the potential partnership, said Lodes, they need to evaluate the payment security software and ensure it will comply with PCI standards and provide small software players with all the protection that is needed when accepting transactions.
Lodes stressed the value of having a team of people to support software companies when it comes to integration. Having someone a software developer can call or email when there are issues makes a world of difference and allows ISVs to integrate and deploy payment solutions much quicker.
Yet even as these software companies link up with experts, such as First American, and mobile payments mark a sea change in the way consumers transact, security should remain top of mind. “The importance of innovation when it comes to payment security is so critical, as hackers are learning new techniques each day to try to capture data,” Lodes said.
Vigilance must extend beyond the realm of payments firms and move toward the consumer on an individual level, maintained the executive. “The consumer must download regular updates and security enhancements on their mobile devices to keep their digital wallets and mobile payment data safe,” he said. Additional safeguards include difficult passwords or biometric authentication for payment methods to hinder outsider access to payment data.
Lodes also said it is critical payments are made on a secure, private network and not on a public Wi-Fi network. Unsafe purchases abound and mean that companies “review security and fraud detection information daily. You can’t take your eye off the ball. And, as you hear about compromised information in the market, you have to evaluate your own security solutions and ensure they would stand up to that kind of attack,” he said.
“It really is a wake-up call to every payment provider that security is evolving and changing all the time,” Lodes continued. “It’s up to payment companies to deploy solutions that prevent it from happening to keep our customers and their consumers safe.”
He added that P2P payments have grown significantly in 2017, “due to the rise of millennials and how they want to pay, whether it’s for splitting dinner, payment for a concert ticket or rent. These advances in payment technology are meeting the needs of a generation that wants to make a payment or transmit money easily to a friend or family member.”
Looking ahead to the dawn of a new year, marked in part by the growth in visibility (and, of course, usage) of mobile wallets, wearables and biometrics, Lodes said artificial intelligence (AI) “really took center stage this year in showing us what this technology can do for payments, including the implementation of bots, advanced fraud detection and enhanced consumer experiences. We have just scratched the surface of AI.”