StrategyEye hosted their The Future of Payments event last night which showcased a number of up and coming start-ups to an audience of over 130 payment entrepreneurs, investors and senior executives. Key note speakers on the night included senior executives from payment companies Klarna, Stripe, iZettle and Adyen, as well as startups, Flypay and Safello.
Commercial manager of StrategyEye, Harry Thompson introduced this month’s business intelligence event and provided some insight into the current payments landscape. “Despite innovation, there are still a lot of grey areas and questions around what’s next for payments. With such questions in mind, this evening’s proceedings are intended to provide valuable insights into the future of payments and a projection as to what’s next in this fast moving sector,” Thompson said.
Head of editorial and analysis for StrategyEye, Tom O’Meara gave an overview of the current innovation and investment trends and explained that “venture capital investment in fintech is huge and has been growing for the last three years”. According to StrategyEye data, O’Meara explored how payments are powering growth in financial technology and are “a slightly more mature aspect of fintech”. Moving into the future, StrategyEye do not think that “investors today believe there will be one single solution or one company will win out,” which means many players are welcome to the payment space.
The idea of innovation and transforming traditional payment systems was explored by Klarna’s head of expansion, Jens Saltin. With an office in London as of this year, Klarna now operates in 18 markets with 35 million customers and 50,000 merchants. Saltin believes that mobile payments is “where the future of payments essentially is” because the “smartphone is growing faster than anything else.” He explained that at Klarna, they believe there is “a big myth out there which says that mobiles are for browsing and desktops are for purchasing” but “people will buy on mobiles if we let them.” Klarna’s plan is to make mobile payments simpler by having a responsive design, filtering, no registration and a simple checkout system.
Stewart Roberts, iZettle executive vice president, explained that iZettle used an “infrastructure that already existed: smartphone technology, added bits to it and made it easy.” The company were the first to launch a free of charge chip and pin reader and now handle mobile transactions for small businesses to enable merchants to accept payments using smartphones and tablets. Roberts predicts that the “tipping point” for payments will come within the next two years and implied that Silicon Valley will present an opportunity for “innovation to unlock where someone else is unwilling.” He concluded by saying that knowing your customer is very important, “if you don’t know your customer, you won’t get the uptake.”
James Allgrove, head of business development and operations at Stripe, also insisted upon the importance of simplifying payments and described traditional banking as a “mess”, and said that older forms of digital payments like PayPal were a “one stop shop solution but lacked control over customer experience.” Stripe help the most successful companies to accept payments and manage their online business but want to focus more on helping a company to grow their business and allow them to have flexibility in how they deal with their customers. Allgrove said that transactions were still complicated and the future of payments is in marketplaces like Airbnb and Uber, as the whole transaction process is brought to one landing page and the customer has “control over end to end funds.”
Adyen help many of the world's largest businesses to use technology and their approach is to provide an effective local service around the world. Ian Campbell, head of UK account management for Adyen said that a business’s payment interface could be improved in three ways, “internationalisation, localisation and optimisation.” Campbell stated that “plastic isn’t always fantastic” and it is important to know what the popular payment methods are in different countries, for example the konbini in Japan and parcellos in Brazil, and need to adapt to fit their customs in order to succeed.
The audience then heard from Tom Weaver, CEO and co-founder of the start-up Flypay, which is “seeking to disrupt the hospitality sector” with their core mission to “get rid of paying at the table” and in a month’s time, “reinvent the bar tab.” Frank Schuil also spoke about his start-up Safello, which he described as the “safe fellow of the bitcoin world” and mentioned how they intend to get the “2.7 billion un and underbanked” into the cryptocurrency market. They are primarily using SEPA to build their company around the world and are working with the authorities, rather than against them, to become the “bank of the future”, said Schuil.
The StrategyEye event highlighted that 2015 will be a big year for global payments because of the increasing focus on simplicity of use and customer experience. According to the keynote speakers, the increase in numbers of start-ups and new companies will also lead to more innovative technology, as long as these new payment platforms are made available.