Payments Innovation

Digital Commerce: You Can’t Touch This

Digital Commerce: You Can’t Touch This

“The opportunity to educate on digital banking and payments, and the opportunity to fully enable touchless commerce, is greater than it has ever been — and the technology is already in place to make it happen.”

Technology has advanced in the past 10 years, faster and farther than even its most breathless devotees imagined. But they didn’t envision COVID-19 or its weird transformational energies, which are supercharging change. “The global pandemic has accelerated the adoption of digital banking and commerce by five years,” said Mike Kresse, senior vice president of card payments and money movement at FIS. “The technologies exist to enable this. The winners will be the ones that bring this full experience to life for their customers.”

The following is an excerpt from How 35 Execs Are Powering The Great Digital Shift Of 2020 (And Beyond), contributed by Mike Kresse, senior vice president of card payments and money movement at FIS.

Global economies went through different stages of hibernation over the past three months.  During that time, financial ecosystem providers (financial institutions (FIs), issuers, acquirers, technology providers) stood the test in ensuring that commerce in our globally connected economy continued to happen. When a consumer ventured out to procure critical goods and services, transactions went through. When hospitals needed to pay for critical supplies, payment capabilities and funds were available.

Had our financial ecosystem suffered from the supply chain interruptions caused by manufacturing drop-offs in other sectors, we’d be in a much different, and worse, place. Instead, commerce continued, and a great number of digital opportunities have emerged. The opportunity to educate on digital banking and payments, and the opportunity to fully enable touchless commerce, is greater than it has ever been — and the technology is already in place to make it happen.

In January, those that had enabled wallet technology on their phones had a hit-or-miss checkout experience. Often, the consumer had to ask whether that type of transaction was supported at the merchant – and in some cases, the answer was no. For those who didn’t want the ambiguity, pulling out a physical wallet seemed to work just as well. Today, we are cautious about how many different things we are touching when we are out. Cash is a potential carrier. A contactless card still needs to be tapped. In most cases, loyalty still needs to be typed in. How do consumers procure their goods and services without touching different surfaces?

In January, commercial clients, especially in the United States, were still printing checks for their B2B and B2C payments. Is that inefficient? Does it create more opportunities for fraud? Is it costly? Does it delay payment receipt? Does it require touching paper in most cases? Yes to all. In a society where we have already enabled real-time disbursement of funds to both consumer and commercial accounts, why are checks still prevalent?

In January, if I owed a friend $20 to pay for lunch, I would likely hand them cash. Even though there are several digital P2P services available, cash was easy. Now, how would I hand them cash in the era of social distancing? Do I ball it up and throw it to them? Why would I expose someone to that risk?

As we’ve worked with our clients during these uncertain times, the above examples are representative of the dynamics that have made full digital enablement the No. 1 priority. Taking all touch and all friction out of the transaction lifecycle is critical, and if our clients don’t have these services available, our clients’ clients will choose another partner.

The global pandemic has accelerated the adoption of digital banking and commerce by five years. The technologies exist to enable this. The winners will be the ones that bring this full experience to life for their customers.

Read more executives' insights in How 35 Execs Are Powering The Great Digital Shift Of 2020 (And Beyond).

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