The introduction of ATMs in the 1980s revolutionised banking as we knew it, giving customers more flexibility at the cost of the jobs of bank tellers. Today, it is the internet that is playing a role in changing the banking scene. While credit cards may still seem like a new invention to seniors, they are actually becoming outdated to our youngest generation. For them, Google Wallet, PayPal and other e-money ventures are where the feature is headed. Without a crystal ball, it is hard to predict where our fast changing banking technology will be in 5 or even 10 years, but here are 4 possibilities of how internet banking could evolve.
1. Less cards, more e-devices
More and more smartphones are gaining near-field communication technology, which enables them to be used as a contactless payment device, usually through Mastercard’s PayPass. Samsung recently announced that it was introducing more NFC to its line of smartphones and industry analysts have guessed the iPhone 6 will also work with contactless payment. If NFC technology just proliferate in such a way, cards will become more and more irrelevant as people will be able to simply use their phones. Wallet systems such as Google Wallet and Mastercard’s anticipated Wallet will further push cards into oblivion.
2. Greater reliance on internet banking
The days of needing to visit your bank to send money or pay a bill are long gone, and using internet banking to sort through your finances is becoming evermore commonplace. This is a trend that will only grow in the next few years, making bank visits less and less common. As money can be transferred from one account to another almost instantaneously, even visiting a cash machine to pay a debt to a friend is becoming outdated.
3. The importance of internet merchants
PayPal is a force to be reckoned with in the internet world, as they have a virtual monopoly on internet e-commerce and money transfer. PayPal as an acquirer has simplified the work of many e-commerce sites by performing payment processing for them, meaning many sites no longer need configurations to take payments by debit or credit card. PayPal is universally respected as an industry standard, but as more and more people join they will need to up their game if they hope to ‘replace’ the role of cards or banks online. Oft criticised for being slow and bureaucratic, PayPal have a chance to become what online banking looks like in the future—but only if they can respond to change.
4. Internet currency
The most recent crisis in Cyprus forced the media to shine a light on online currencies, as much was made of money disappearing from the island in the form of Bitcoin. Bitcoin is a virtual currency that can be substituted for many services and products online. Bitcoin is not controlled by a government or central bank, but rather increases at a constant rate as prescribed by a computer algorithm. Bitcoin is not perfect: its value as traded for the dollar has jumped up and down massively in the past few months. It does however show an interesting way in which people can take their money out of real world circulation altogether, a prospect frightening to many banks.
About the Author:
This is a guest post by Samantha Priest, a huge fan of blogging and technology geek. She loves high-end tech gadgets and the freedom that comes with them. This is allowing her blogging from anywhere, using clear wireless.