Why hasn't the credit card changed in the last fifty years? Besides the addition of a chip and the glamorously-named secret code on the back, the credit card can hardly be said to have been revolutionised. Same size, same weight, same functionality. Same necessity for carrying it (or several of them) around in your wallet. The answer is that, generally speaking, it works. The payments industry is ripe for disruption, with a host of technologies and newfound connectivity breeding opportunity, but payments companies have to think beyond just better, faster, whatever, payment. This is because the experience of payment is only a tiny slice of the customer experience, and it's generally the least interesting slice. Payments companies, to be successful, should look at the bigger customer experience. And we're seeing them start to do so, which means that the days of plastic may finally be numbered.

Waiting for Go-dough

Some non-financial players have not bothered to wait for a FinTech solution. The Starbucks app lets customers dispense with wallet-grabbing altogether: you can pay via the app, which is handy because you probably have your phone in your hands anyway. But beyond that, Starbucks adds value to the system by letting you order in advance and skip the queue altogether, or tip the barista digitally, or gain access to perks and prizes like the occasional free cup. Some fifteen percent of Starbucks-goers use the app, which are huge numbers. The London Underground is another example: the London Oyster app doesn't just allow you to swipe in and out via your phone, but with it you can easily top up, view your journey history, plan your route, etc. The reason for success is the same: value added.

The biggest kids on the playground

Despite not having a pre-existing client base like those organisations do, FinTech contenders in the payments realm are gaining ground. One class of them helps provide companies with a central platform on which to accept money from the huge variety of payment methods that already exist. People want to pay using their method of choice, be it e-payment apps like iDEAL or Giropay (or a hundred others), or bitcoin, or by traditional payment methods like direct debit. It's a fragmented ecosystem at the moment with a lot of e-money choices, and FinTechs like MANGOPAY and EMPcorp are providing B2B solutions to help companies give customers more choice.

The other class of payments FinTechs deal with customers directly, letting you send money here and there without IBAN numbers, credit card details, billing addresses, cash, coins, or cheques. Reimburse a friend, buy a mousetrap online, pay for a meal... since money is increasingly invisible there's no telling how easy it will get to sling it around with gadgetry. The added value here is cutting out the annoying variance of platforms, from needing special codes for bank transfers to needing cash at small shops who can't pay the fees to be able to handle credit cards. Lydia and Hexapay are two examples. Such companies still act as intermediaries, however, so as blockchain technology strengthens we could see a new class of FinTechs in this area.

So we're seeing a widening array of payment options in 2016, a few of which are sure to break into mainstream usage. Some, like Venmo, have already done so.

Looking into my crystal ball

But what about five, ten, twenty years down the line? My own opinion is that the "payment gesture" will be something your grandkids will make fun of you for once doing.

Paying is a burden, and improvements in recognition and identification technology, alongside the march of big data, will take this burden off our shoulders (or rather, out of our pockets). Retailers will be free to focus their energy on the fun and important part of the customer experience while the drudgery of payment can be treated as a footnote. An unnoticed footnote.

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