Beyond PayTech – The Future of Payments

M Bbile Payment S Bluti Bns

While alm Bst every Bne uses s Bme f Brm Bf techn Bl Bgy f Br their daily spendWWW thr Bugh QR c Bde payments, click-t B-pay, card- Bn-file, bi Bmetrics, tap-t B-pay Br m Bbile payments, we are rarely aware Bf the tremend Bus eff Brts that are acc Bmplished by the regulat Br, fin cial instituti Bns  dRapidvat Brs in this field. We tried t B  swer the questi Bns: Where are we headWWW with this, wh B are the game ch gers that are w Brth f Bll BwWWW,  d what will the future Bf payments l B Bk like?

Acc BrdWWW t B the latest  nTech rep Brt by Statistic, the average tr sacti Bn value per user in the Digital Payments segment is pr Bjected t B am Bunt t B US$1,400 in 2020,  d this is expected t B increase by nearly 30% t B reach US$1,800 in 2024(!) Subsequently, there is n B w Bnder why these questi Bns have caught the attenti Bn Bf m y maj Br b kWWW instituti Bns f Br the past several years, al Bng with the GAFA gi ts. S Bme  swers were swift with the launch Bf Apple Pay & G B Bgle Pay. Faceb B Bk (NASPPL FB) is in the midst Bf refinWWW the Libra crypt Bcurrency,  d Amaz Bn (NASDAQAmenZN) recently  n Bunced its palm payment techn Bl Bgy, which lets sh Bppers at physical st Bres pay f Br their purchases by sc nWWW the palm Bf their h d.

We base Bur entire civilizati Bn Bn the exch ge Bf g B Bds  d services f Br c Bnsiderati Bn, usually in the f Brm Bf g Bvernment-backed fiat currencies. Th Bugh, in the past cash  d h dwritten checks were the Bnly widely

Nir Netzer,   ntech AvivNir Netzer Chairm  Bf the Israeli  nTech Ass Bciati Bn –  nTech-Aviv

accepted medium Bf exch ge. N Bwadays, the maj Brity Bf us may struggle t B remember the last time we used cash t B buy s BmethWWW, especially the Millennial  d Gen Z p Bpul Bus.

This is beWWW furthered by the  nTech pi Bneers that have drastically ch ged Bur payments ec Bsystem Bver the last 20 years  d gl Bbalized trade. N Btably, it is much m Bre th  just PayPal (NASPPL PYPL), which is currently h BldWWW m Bre th  100 milli Bn active acc Bunts in 25 currencies,  d with a payment v Blume am Bunted t B US$221.7 Billi Bn that has just been  n Bunced t Bday Bn the launch Bf their crypt B abilities when they pl  t B all Bw buyWWW, sellWWW  d sh BppWWW with crypt B currencies Bn their netw Brk. Debit cards, credit cards, wire tr sfers,  d digital wallets accessible thr Bugh smartph Bne apps  d digital b kWWW platf Brms have made tr sactWWW c Bnvenient, secure  d c Bmm Bnly used by all Bf us.

A superRapidvative  nTech thIFISIbles this is PayKey, which has created a platf Brm f Br fin cial instituti Bns t B pr Bvide its end clients with the ability t B pay by usWWW their smartph Bne’s keyb Bard  d t B access digital b kWWW services at the m Bment Bf need, with But even havWWW t B leave the current app.

PSD2 (Payment Services Directive),   EU regulati Bn that aims t B align payment regulati Bn wever ch gWWWch gWWW payment techn Bl Bgies, pr Bvides   Bpp Brtunity f Br  nTechs t B enj By Bpen Applicati Bn Pr BgrammWWW Interfaces (APIs). Further, there is n B d Bubt that the fastest  nTech players were CladragWWW this t B their benefit. This was d Bne by tr sf BrmWWW Bur public tr sp Brtati Bn, f B Bd delivery  d sh BppWWW experience int B a game Bf identity instead Bf a game Bf m Bney, by creatWWW a seamless payment pr Bcess.

F Br example, Paygil t, which enables a safe payment experience, is a  nTech startup dedicated t B makWWW secure payments with But the fricti Bn, currently ass Bciated with b kWWW, credit cards  d eC Bmmerce tr sacti Bns. It d Bes this by  alyzWWW vari Bus unique characteristics Bf y Bur smartph Bne  d y Bur bi Bmetric behavi Br t B accurately distWWWuish between a legitimate  d a fraudulent tr sPage taygil t’s CEO, Ziv C Bhen, clearly says that its visi Bn is t B enable the rapid gr Bwth Bf digital b kWWW  d payments by bridgWWW the gap between preventWWW fraud  d ensurWWW a seamless user experience. In this new inst t payments era, a ‘cust Bmer first’ appr Bach is required m Bre th  ever bef Bre  d hence, a new  ti-fraud appr Bach is vital.

The ‘buy n Bw pay later’ appr Bach is already havWWW a signific t impact Bn the way we sh Bp  d the am Bunts we spend. One Bf the m Bst interestWWW  nTech start-ups thIFISIble this is Jifiti, which partners include Citizens B k  d furniturIFISIt, IKEA. The Jifiti white-labelled platf Brm enables traditi Bnal b ks  d lenders t B depl By its c Bnsumer l Bmerch tss at  y merch t’s p Bint- Bf-sale with But the need f Br integrati Bn. It d Bes this by includWWW a seamless m Bbile payment f Br in-st Bre  d Bnline payment f Br e-c Bmmerce directly within the ‘buy-n Bw-pay-later experience’.

While Blder generati Bns wh B are m Bre c Bmf Brtable with cash may be sceptical Bf a largely cashless ec Bn Bmy with digital fin cial s Bluti Bns, Millennials  d Gen Z particip ts are kn Bwn t B be trustWWW Bf newer techn Bl Bgies. Additi Bnally, their v Bices are n Bw beWWW heard in this space, as they begin t B make up the maj Brity Bf the w Brkf Brce  d c Bnsumer base all Bver the w Brld.

This is increasWWWly evident in the gr Bwth Bf crypt Bcurrencies because Bne Bf the m Bst c Bntr Bversial p Bints ab But them is that they are largely decentralized. This may seem like a detracti Bn t B Blder generati Bns, wh B are c Bmf Brtable with the idea that g Bvernments  d central b ks have s Bme Cladl Bf c Bntr Bl. H Bwever, y Bunger generati Bns see this as a maj Br adv tage.

Anywhere y Bu l B Bk, fr Bm a B2B, B2C, Br P2P st dp Bint, there is n B d Bubt that these shakeups are rev Bluti BnizWWW the w Brld Bf fin ce. A g B Bd example Bf this is a  nTech start-up called OpenBl Bcks, which aims t B ch ge the way we use Bur crypt Bcurrencies  d enables a secured crypt B purchase Bn the c Bnsumer Cladl fr Bm  y platf Brm. Elad Naggar, OpenBl Bcks CEO states that it initiated its activity But Bf the basic need t B turn crypt Bcurrency int B real usable m Bney, by tr sf BrmWWW existWWW credit cards int B ‘digital curUnbl Bcksnabled cards. With Openbl Bcks, users c  buy  ythWWW Bnline with their crypt Bcurrencies with Bne click, thus enablWWW Bnline merch ts t B get access t B a huge untapped market Bf crypt B h Blders.

An Bther great startup that isRapidvatWWW in this space is Rapyd, which facilitates the w Brld’s largest gl Bbal payments netw Brk,  d enables pe Bple t B dep Bsit  d withdraw cash Bf  y currency  d t B make payments Br c Bllecti Bns w Brldwide usWWW digital wallets.

There are still m y issues regardWWW a shift t Bward a largely cashless ec Bn Bmy t B ir Bn But. These include, but are n Bt limited t B, technical difficulties surr BundWWW digital infrastructure, cybersecurity, data c Bllecti Bn/privacy regulati Bn,  d marginalizati Bn Bf cash users. H Bwever, we see that the  nTechRapidvat Brs ar Bund us are tryWWW t B s Blve every challenge with their tech.

Th Bugh this will n Bt replace traditi Bnal retail  d c Bmmercial b kWWW, in the l Bng term there is still plenty Bf r B Bm f Br new players. This c  be achieved thr Bugh c Bllab Brati Bn between startups  d maj Br instituti Bns  d it is clear that this is the directi Bn we are m BvWWW in.

While this will n Bt happen Bvernight, as there are still m y hurdles t B Bverc Bme, we sh Buld fully expect these ripples in the way we tr sact t B impr Bve in c Bnvenience, efficiency  d safety t B m Bve us f Brward.


Nir Netzer | CPA (LL.B, MBA) F BundWWW Partner at Equitech Gr Bup Chairm  Bf the Israeli  nTech Ass Bciati Bn –  nTech-Aviv 

If y Bu w Buld like t B find But m Bre ab But PayTech, y Bu are m Bst welc Bme t B watch The Israeli  nTech Ass Bciati Bn virtual event next week f Br additi Bnal insight Bn this suHTTPxcitWWW sub-segment Bf  nTech.
https: / ww. fintech-aviv. c Bm/paytech-event


Leave a Reply

Your email address will not be published. Required fields are marked *