There was a time when the latest innovations first left their impact on those in the highest socio-economic strata. The benefits then trickled down slowly. With digital transactions, this is not the case. Instant digital payments deliver value to practically anyone who has access to a smartphone.
The future of digital payments dictated by end-users
As we move towards a world where digital payments encompass most transactions, both infrastructure and regulation need to work in tandem to support the volume and speed necessary for this ever-expanding network to thrive.
As an industry, we are moving at the pace dictated by the end-user, both consumers and corporates alike. Whether a person in the street or a business, the target is accessibility to payments that are virtually instantaneous, efficient, secure, reliable, and at a reasonable cost. The financial services industry as a whole is delivering on these demands, and this is thanks to the many players that are committed to providing the services needed.
In this brave new landscape, two stalwart giants, SWIFT and SEPA, stand tall, creating the networks that make near-instant payments a reality. In the European Union, SEPAInstant dictates a mere ten-second window for financial institutions to confirm or deny a transaction request – an affirmation that the customer’s needs are heard and answered.
At Finance Incorporated Limited (FIL), we embrace this attitude and have been preparing to ensure that we are fully aligned with the stringent requirements of SEPAInstant. However, there are several challenges we face, even with a great in-house technical team, as we aim to forge the robust technology that underpins this revolution. Compliance becomes second nature with automated sanction screening and watchlist refusals, while intelligent systems ensure a seamless flow of information, transcending the boundaries of SEPAInstant’s mandate.
In this dynamic landscape of digital innovation, FIL stands firm in its commitment to embrace cutting-edge solutions. Alongside the realm of traditional digital payments, FIL supports the future-forward world of cryptocurrency. Recognising the transformative potential of blockchain and decentralised finance, FIL is actively exploring avenues to integrate and facilitate crypto payments within its offerings.
In terms of digital payments, we reckon the world should be a place where all individuals, regardless of their socio-economic background, can seamlessly participate in the new financial paradigm. Embracing crypto payments is one of the many ways towards a more decentralised future, which can further enhance digitalisation and drive financial inclusion.
By embracing a client-centric approach, companies should base their service delivery on client insights. Furthermore, they should consider developing most of these needed technologies in-house so that their platforms are tailored and based on client feedback and optimised to match the realities of the current moment, just like we do at FIL.
These realities also include the desire for transaction costs to be kept to a minimum. This is a requirement for economic fairness, as companies activating in the payments industry shouldn’t be oblivious to the situation of low-income earners working in highly developed economies and sending money to their country of origin, for example. These transactions, when based on the fast and technically efficient systems that are being rolled out, will enable fairer costs than can be provided by legacy systems.
We are encouraged by the direction that much of the industry is taking, and we endorse efforts by regulators, fintech companies, technology platform suppliers, and the networks to provide speed, efficiency, and low cost. We believe that, as an industry, we have a social responsibility to extend our services with equanimity and in a way that benefits as many people as possible.
We are also excited by the rapid development of technologies that, over the foreseeable future, will further nourish intelligence within the industry, which will generate speed and efficiency of transaction monitoring and process a significant volume of payments. This will continue to deliver even more functionality and increase rapid access to accounts to those who need it most.
Embracing this transformation, FIL feels a sense of pride in their role within the industry. Beyond profits and commerce, at FIL we see the potential to shape a more equitable social landscape – a beacon of hope shining brightly on the path towards economic fairness.
This editorial piece was first published in the Payment Methods Report 2023, which provides an in-depth overview of the latest worldwide developments in how people pay, the payment methods space, the innovative technologies that these methods work upon, and the best strategies on how to win at conversion and retention.
Finance Incorporated Limited (FIL) is an Electronic Money Institution based in Malta, delivering a full range of financial services and infrastructure solutions aimed at individuals, corporates, and institutions. Licenced and regulated by the Malta Financial Services Authority, FIL’s extensive and innovative payment solutions include e-accounts, payments, card issuing, acquiring, and virtual POS.
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