Written by It’s Vegas, so time for a glass of champagne. Luckily, they had some in the green room for the W3C panel on “One-Click Buying: New W3C Standards for Web Payments” so I poured myself a large one and went on stage to toast the guys while they discussed the working draft of the W3C Payments Request API (July 2016). They deserved it, because in-app and in-browser payments are going to be huge. Bringing chip and PIN security into the web and mobile world is huge. I went to a demo hosted by Amex to see it actually working, which it did. The new API is implemented in Chrome and on the Samsung mobile browser and I saw it with my own eyes work on both. The latter use case – mobile browser triggering mobile wallet with biometric authentication – was slick. Once I can use Apple Pay on my iPhone to buy from mobile web sites and apps, I can’t see that I’ll ever pay any other way.
The impact of this is, if the people I spoke to were anything to go by, considerably underestimated. The ability to make secure and convenient remote payments is transformational and it will inevitably mean a significant growth in online business. But more than that, it will drive more transactions in-browser and in-app and this will mean that there will be more competition, because it is easier to introduce new payment mechanisms this way. Here I am explaining this to one of the international delegates. I told her that the marginal cost of introducing a new payment scheme (such as a direct-from-account “push payment” into an app) would be vastly less than the cost of introducing it a traditional point of sale and she told me to stop following her.
The next day I was sent off to the Money2020 exhibition floor like a flesh and bone drone remotely piloted from Guildford. I was getting instructions like “go to stand XXX and see if the PIN on glass solution is in the TEE (it was) and certified (it wasn’t)” and then “go to stand YYY and see if the demo is real or simulated” and so on. So I did, and then I ran into noted venture capitalist Matt Harris. I decided to tell him my theory about regtech being a more important use of new technology than fintech for many of our customers because of the disproportionate and uncontrolled costs of compliance. I think I may have convinced him. Then I explained to him why it sometime makes sense for Manchester City to play a “false 9” against teams who lack pace at the back, because midfield runners can always move around the centre backs who are caught between tracking and sitting back.
I went off to a couple of conference sessions but since my first meetings of the day were at 7am on all of the first three days, I found it a little hard to concentrate. When I went to the Cafe Presse to get a little pick me up (quadruple shot latte with an extra shot) I kid you not there were two guys in there who were fast asleep. Lightweights.
The Tale of the Princess and the POS.
Once upon a time there was a Princess. She went to see the King and told him that she was bored and that she wanted to be an entrepreneur so she wanted the money to set up a shop. She decided to set up a potpourri shop and it was very successful.
She ordered a lovely POS terminal and put it on the counter.
Several customers came in every time to buy potpourri, including a Prince, who was very attractive to her because of his tubby Dad body. The Prince paid with his John Lewis MasterCard but things didn’t go as smoothly as the Princess had hoped because it took far too long for the transaction to complete.
When she went to bed at the night, she couldn’t sleep. The POS was bothering her.
“It’s big and ugly Daddy and it takes up space that should be occupied by lovely potpourri”.
So the King got her a small POS and attached it to her mobile phone.
But when she went to bed that night, she still couldn’t sleep. The POS was still bothering her.
“Daddy all my friends have Venmo and Zelle, so why do we make them use stupid old cards like the peasants have?”
So Daddy took away the POS and next time the Prince came in for some potpourri, he Venmo’d the money to the Princess. And his number.
“That’s better Daddy” she told the King. “Now that there’s no POS I can sleep properly again. And my potpourri sales have gone up because of the loyalty scheme in my app”.
The Prince and the Princess changed their status to “hooked up” and they lived happily ever after.
Night night.
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“The ability to make secure and convenient remote payments is transformational and it will inevitably mean a significant growth in online business.” Why would this lead to growth? As far as convenience is concerned, your browser (computer, phone, tablet) currently can store and auto-enter your credit card information on any website that you haven’t previously visited (the websites that you have previously visited can store your card info.). As far as safety is concerned, consumers have zero liability for fraud. The majority of consumers know this (or they don’t care much about this) and are very comfortable paying online. The smaller group of consumers who don’t pay online due to fears about security are going to be very tough to reach / convince. How do you explain the security of a cryptogram in plain English so that it sounds any better or safer than all of the current gibberish about SSL, HTTPS, etc.? Every credit or debit card statement, every website, etc. has been plastered with assurances about zero liability for over a decade. What new message can you deliver that gets the holdouts to feel safe online?