MIAMI BEACH, Fla.–Payment-industry experts who gathered in Miami Beach, Fla., April 27 to 29 to attend the 23rd Card Forum & Expo reflected for the first time in a few years an attitude that seemed genuinely ready to greet certain disruptive changes instead of brace against them.
A strong turnout of some 750 attendees from countries and companies around the world exceeded that of the past few years, suggesting participants on all sides of the industry–from issuers to merchants to those promoting systems to improve loyalty and prevent fraud–are feeling more optimistic about their businesses in the aftermath of the Great Recession.
In presentations, panel discussions and general discussions during the event, participants that included entrepreneurs and top executives from all four major card networks sketched bold new directions for payments, with a strong emphasis on emerging markets–both within the U.S. and abroad. SourceMedia, publisher of PaymentsSource, sponsors the annual event.
Citigroup Inc.’s top enterprise executive Paul Galant predicted that when mobile payments become widely available, the rate of adoption will dwarf “anything we’ve seen before” (
“The digital revolution will encompass payments on digital devices, and that will number in the billions,” he said. “Consumer choice will play a big role.”
Galant said he was “bullish” on the mobile-payment space. “It may take little longer, but it will provide all of us with a very rich future.”
The emergence of new technologies developed on open platforms through partnerships will drive the vision for payments growth outlined by Dan Schulman. American Express Co.’s group president for enterprise growth, with a great deal of live trials and experimentation (
“I sense that the fear of change we saw a few years ago is gone,” Jack Jania, vice president, general manager, secure transactions at Gemalto NV, tells PaymentsSource.
The chip maker is involved in a number of undisclosed new mobile-technology efforts that bridge different industries and technologies, which Jania says is a significant change from a few years ago.
“From a technology perspective, I see all players embracing different modes of payment technology, whereas three years ago many were stuck in a mindset of clinging to old technologies such as magnetic stripes and uncomfortable with talking about change,” he says.
The conference atmosphere was palpably “more energetic,” says Mike Kutsch, a payments consultant and principal at Rye, N.Y.-based Payment Strategy LLC. “There is a lot more buzz about opportunities that mobile payments represent rather than a feeling that these new technologies are a threat to banks.”
But debate flared on a number of topics, including the true benefits EMV chip-and-PIN technology might bring to the payments ecosystem, the financial burden merchants experience for card fraud compared with what card issuers shoulder, and the deeper issues underlying debit-interchange legislation.
“It was clear at this meeting that banks are really angry about new rules about debit interchange, but the truth is that everyone needs to be prepared for interchange rates to eventually decline in both debit and credit,” said Deborah Baxley, a principal with consulting firm Capgemini U.S. LLC. “Anyone who doesn’t think interchange rates in the U.S. will someday decline is putting their heads in the sand, ... especially if you look around the world.”
And while more banks are testing mobile payments and seem willing to embrace technology that aims to shift payments from branded cards to more-generic mobile-wallet smartphone applications, many observers are more wary than ever of what is at stake.
“You listen to these speakers talk about the future of payments and how a payment will be a small application inside a phone, and you realize that banks are going to have a major challenge ahead in retaining their brand images in the midst of all this,” said Dennis Moroney, research director at TowerGroup. “It’s exciting, yes, but it is also going to be extremely challenging.”
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