Like magic, payments disappear

Over the past years, new payment trends have flourished. Invisible payment is one of them.

Invisible payment means purchasing a product or service without the need, for the consumer, to make a (card) payment. The term is used to describe how payments fade into the background and become unperceivable. Invisible payments are quickly becoming mainstream, with a variety of approaches focusing on user experience.

The invisible payment trend was quickly adopted by consumers seeking for smoother payment experiences and by retailers, striving to reduce queues and meet the needs of their increasingly time-poor customers.

Companies like Uber or Amazon significantly improved user experience by making payments disappear into the broader customer journey.

Uber placed payment on the background, to focus on the experience.

Disney wanted to complete the Disney experience with MagicBands: instead of park entry tickets, FastPasses, hotel room keys and credit cards, Disney guests wear this wrist band, scanning them against a touch point to complete transactions.

Another example of making payments a more integrated, intuitive part of the user experience is Amazon Go. Amazon pushed further their vision of what the future of physical retail can be, introducing Amazon Go. With Amazon Go, customers enter the store, pick-up their products and they leave. That’s it.

Google has also been working in the same direction with its Hands Free App that allows users to make in-store payments without ever reaching for the phone or wallet. This enables users to pay hands-free, without fumbling with the phone or even opening the Hands Free app.

These are just a few examples that demonstrate the will to transform and reshape the act of payment (which is often perceived as a blocking or negative action) and make it blend in with users’ journey to remove all the negativity attached to it.

Irrespective of their short, medium or long-term objectives, they (retailers, financial institution) all agree that payments must be secured.

Indeed, making payments disappear doesn’t mean security is left apart.

Quite the contrary, with strengthened authentication, secured payments data and reliable “mobile” technologies. Safer authentication methods are growing such as biometric authentication. Biometric authentication is the process of verifying someone’s identity using body measurements or unique characteristics of the body (fingerprint, facial recognition, voice recognition…). Biometrics’ authentication methods are becoming more and more popular and widespread.

Tokenisation has become a reference to secure payments data. Tokenisation is the process by which payment account information is replaced by an alternate value called a token. Issuers, Merchants and Processors who use tokens are able to significantly reduce the risk that sensitive cardholder data may be stolen by data thieves. This is widely regarded as one of the most critical issues to be addressed by the payments industry across the world in the ongoing fight against fraud.

Reliable “mobile” technologies are also key to ensure secured payments. These technologies are diverse, ranging from messaging (3D-Secure code sent by text message to the payer) and notifications (sent through banking apps for example) to geolocation (to control consistency between transaction location and payer’s phone location).

With strengthened authentication, secured payments data and reliable “mobile” technologies, payments security is reinforced.

However, in some regions of the world, invisible payments are not yet at the forefront of payment scene. There are few corners of the world where cash is still a pervasive phenomenon and where electronic transactions are not growing faster than cash. But the movement away from cash is happening in very different ways and at varying paces around the world.

In China for example, wallets created by Alibaba and Tencent have become the most popular ways to pay online.

In Kenya, M-Pesa, launched by Safaricom, allows customers to make payments directly from their phones.

Frictionless user-experiences are driving payments trends. Because at the end, what matters is making consumers’ day to day life easier. Making payments disappear is a good place to start. 

However, frictionless user experiences make it easy for consumers but hide a real technical complexity on the back-end that retailers and financial institutions need to manage.

HPS designs, develops, implements and supports a suite of multi-channel payment solutions fitted for every region, whatever their challenges might be.

To know more about how HPS can help you, please contact sales@hps-worldwide.com