The payments industry has changed dramatically over the past year, and so has the mindset of those in the industry. The focus is shifting from mobile payments and Bitcoin to fraud mitigation and security.
Even in light of the Apple Pay mobile wallet announcement, many industry experts have continued to harp on the idea that mobile wallets are not inherently faster or simpler than a traditional card payment. But they are also saying the industry can leverage the mobile device to enhance payments security.
These topics emerged at the Tomorrow's Transactions Unconference in New York City on Sept. 22, where attendees were asked to write on sticky notes what they'd like to discuss and then broken out into small groups.
Many consumers have been worried about the security of mobile payment systems, but that fear is dissipating. Consumers are starting to realize mobile could be more secure because of location and device ID, said Dave Birch, a payments expert and global ambassador at Consult Hyperion, a consultancy that jointly put on the conference with NYPAY.
Apple (such a hot topic that there were two separate breakout sessions) is focusing on security within its mobile wallet, announcing its use of tokenization and Touch ID biometrics. Telcos secure the mobile phone better than the financial industry has secured cards, said one person at the conference.
While there has been much attention on Apple Pay's Near Field Communication capabilities, many say there will be a greater focus on in-app payments. This could in turn be a threat to card issuers (if Apple adds other payment options such as digital currency) and a threat to terminal manufacturers as consumers make more purchases in apps.
Apps can also address the prevalence of card-skimming devices used by fraudsters to steal data to make counterfeit cards. A bank app can let a consumer request cash from an ATM and send a one-time PIN for accessing that money. This is far more secure than requiring consumers to use the same PIN every time.
"With Chip and PIN we taught people to put their PINs into something that's not theirs," said Birch. "We might have made a ghastly mistake."
Even consumers, who have traditionally not assumed the liability for fraud, are requesting the ability to set restrictions on how their cards can be used, said Ron Mazursky, director of the debit advisory service at Mercator Advisory Group.
Another hot topic was data, and many said consumers should own their own information. Millennials, for example, share a massive amount of data on social media sites and are hit with advertisements that aren't really beneficial or relevant. But as these consumers move to apps that let them follow specific brands, this puts some control back into consumer's hands. The New Orleans Saints were one of the first brands to market on SnapChat, sending users who followed them pictures of merchandise and behind the scenes videos of players.
Identity was another hot topic, with many tossing around the idea of using a mobile device or a wearable, such as Apple's upcoming smartwatch, to identify the user.
Another idea for driving identity and security was using Bitcoin's blockchain system, which records verified transactions to a public ledger. Although Jeffrey Robinson, an author and journalist, described the digital currency as a fraud, he said the underlying technology was "brilliant." And Birch says connecting the blockchain to the Internet of Things environment could allow devices to communicate to each other about their specific functions and keep track of identity.