Shahmir Khaliq, global head of Treasury and Trade Solutions for Citi, says that in order to succeed in today’s quickly digitizing payments landscape, merchants must focus on delivering in three key areas: choice, convenience, and speed. Find out why in The Connected Economy’s Power Source – CEO Edition.
Characteristics Of A Burgeoning Digital Economy
In today’s highly connected marketplace, where business is conducted at digital speed and transactions occur around the globe, one thing is obvious: The world is getting smaller. As digital transformation powers dramatic change across nearly every industry and throughout every region, the importance of cross-border commerce is rising. According to a recent report, cross-border eCommerce is projected to account for 22 percent of eCommerce shipments of physical goods by 2022.
Advancements in technology and the proliferation of payment channels – along with a strong push by regulators – are driving the brisk adoption of innovation in the commerce space. Business models are rapidly changing as more and more corporates look to make payments to and receive payments directly from consumers. Much of this change is being powered by a demand for a better customer experience. At the same time, the lines between consumer and institutional payments continue to blur, with much innovation applied to any transfer of value between two parties, regardless of whether the beneficiary is a corporate or a consumer.
Keys To Success: Choice, Convenience And Speed
The key to fulfilling the promise of this ongoing digital payments evolution will be around delivering choice, convenience and speed. While these characteristics often overlap, each plays a vital role in meeting the demands of the marketplace. At Citi, we understand that meaningful innovation in today’s digital economy requires the combination of choice, convenience and speed to deliver a superior customer experience.
As corporates have increasingly adopted direct-to-consumer models, Citi responded by launching Spring by CitiSM, a digital-only, D2C payments proposition that allows eCommerce payments to be processed through a variety of payment channels. This capability provides our clients’ customers with choice in how they pay, including cross-border. In addition to offering choice to their customers, corporates gain by having a single solution with strong reconciliation capabilities that are capable of covering a growing range of markets.
One thing we know when it comes to payment options is that one size does not fit all. As a payment provider, we have long recognized that simplicity and convenience are key to a winning proposition. To achieve that end, Citi continues to invest in connecting our network to other networks. We know that regional preferences make a big difference in terms of the customer experience. For instance, paying to or from an e-wallet may be important in Asia, or using a mobile phone may be the preference for payment in Africa, or elsewhere it may be a credit card account that is the preferred vehicle. That is why creating a “network of networks” is important. Connecting businesses and consumers, wherever they might be, facilitates convenience.
A third factor in today’s digital payments evolution is speed. Of course, instant payments are not a new concept, but there are plenty of new developments in how these faster payments are powering innovation in the digital economy. A range of innovative use cases is accelerating the growth of instant payments, which is driving new value in the client-customer relationship. Some of the more high-profile examples include immediate insurance payouts, pre-paid mobile phone top-ups, gig economy and freelancer payments, etc.
Citi sees greater adoption of instant payments moving forward as new use cases emerge. And to meet the global transaction needs of many of our clients, we are excited to start to connect instant payment schemes in different markets to offer cross-border instant payments. As the digital economy continues to rapidly evolve, Citi believes there will be a growing demand for choice, convenience and speed around payments in the never-ending quest to deliver the best customer experience possible.
We’re always on the lookout for opportunities to partner with innovators and disruptors.
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