Published : 5 years ago, on 20/05/2020

By Justin Pike, Founder of MYPINPAD

The current crisis facing our world has created a lot of changes to what was the norm. For the payments industry, the most prominent of these changes is undoubtedly the move to more digital payment environments. While digital payments were always on the rise, social distancing and sanitary concerns has given consumers new motivations to avoid using physical payments like cash and focus on the digital-only options instead. There is a problem however, and that is the sudden rate at which the industry is heading towards digital-only will very likely alienate and terrify certain customers who, up to this point, have always used physical payments instead.

For example, online transactions bring the benefit of reducing contact related infectious disease however, it has also resulted in surging attacks from online fraudsters.  As an industry, we need to consider the challenges facing some people in society when it comes to digital access and skillset. There is still a large number of people in the UK that have never made a payment or banking transaction online. So, how do we ensure that we all reap the benefits that improved online security offers and stay safer?

Creating an ‘omni-channel’ experience across retail, banking, travel and other key industries has been a well-pedalled mantra – but this has quickly become a very real issue of social responsibility as we all face Covid-19. The current global pandemic will cause lasting volatility to the way people around the world interact and, as a result, how money is moved. For me, creating a level of continuity across the physical world and the online world, and giving people that are new to digital transactions a sense of familiarity, is now a matter of urgency.

A recent survey from Mastercard highlights the sudden shift in tendencies towards payments since the outbreak of Covid-19. The use of cash in particular has seemingly halved. What we don’t need is for this shift to create a siloed rush for solutions among payment service providers and Fintechs; this risks an even greater divide between consumer demographics because of the varying degrees of digital engagement. What we need is a fully inclusive payments experience – with an emphasis on the word ‘inclusive’ – not on inward facing terminology that serves a B2B purpose only.

The above note on inclusion also applies to many SME businesses, as well as consumers. Many businesses that rely on daily footfall from commuting office and retail workers have quickly started to offer online versions of their services – including many food and beverage outlets taking online orders for the first time. This apparent digital lifeline, however necessary, instantly opens up thousands of businesses to serious card not present (CNP) problems and data liabilities that they have not been educated to deal with. The worrying thing is that this risk is exponential and potentially as damaging to businesses as the global pandemic.

‘Post Covid outbreak’ is a new world that we are now tackling. And we do already have the technical capability to face the challenge successfully, if we use the right collaborative approach. However, the FCA’s announcement to further extend Strong Customer Authentication (SCA) standards, may not be ideal timing if it is perceived as an indication that online transaction security measures are not the urgent priority, which they of course are.

The payment trends and issues outliving the virus

For face to face payments touch-free shopping and payments could be a lasting legacy, with people less likely to want to use a public PIN pad or ATMs in light of hygiene fears. And for keeping safe online, online authentication and its development has long been crucial to the successful digitisation and security of financial products, such as payments and banking.

Governments and the WHO are calling for us all to change the way we live and do business, and there is a widespread agreement that digital services are key to this. The technology to make this experience consistent for people of all ages and circumstances, and for merchants, is ready now for transactions made instore, online or from home. From contactless payments and new regulations, to improved authentication measures, global financial inclusion and payment innovations hold the key to improving the way we transact online now and in the future. We just need the technology to be accompanied by the right advice and guidance for individual and business members of society who will be expected to adapt to new methods quickly.

To activate consumer smart devices as payment and authentication tools and allow for ‘PIN on mobile’, the industry has been creating stronger authentication standards. These stronger standards are designed to achieve the goal of allowing the public to feel safe and comfortable using their smart devices to access their financial services, wherever they are. This technology can also be used by merchants, who can speed up the payment process by fully digitising it. By familiarising consumers with universal payments and authentication methods for both online and face-to-face transactions, I believe that consumers will be able to easily respond to the new way of life brought about by ‘COVID’.