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Payment technologies put banks’ on their toes as experts’ point way forward

Since the emergence and revolution of payment systems driven by seamless payment technologies, traditional banking model is becoming obsolete, thus forcing banks to rise to the challenge of either falling in line or crashing out as payment solution competition rages on.

Today, there are growing number of payment solutions created by financial technologies and digital science.

Explaining the development in Abuja during the annual retreat of the Committee of E-Banking Industry Heads recently held in Abuja, a senior official of the Akintola Williams Deloitte group, Mr. Oluwole Oyeniran, said, “Payments technology is evolving at an unprecedented speed”.

“Contactless cards, online payments, mobile payments, are all becoming more prevalent. Keeping pace with those technologies will require major investment from banks, and they have to contend with the fact that their new competitors-for example, Paypal and Aple already have an edge in digital technology. Banks will need to ramp up their investment to be able to make most of the opportunities that exist in payment technology.”

In his submission, the Chief Executive Officer of Interswitch Group, Mitchell Elegbe, called on banks and other payment service providers to adopt disruptive technologies, saying “Banks and related services providers have to create your own monopoly, remain flexible and ready to adopt, after all you should expect to be disrupted. And beware of activity trap. Do not work so hard climbing a ladder only to discover it is resting on the wrong wall”.

Whereas the Chief Executive Officer of E-Transact, Mr. Valetino Obi was of the view that e-payment providers should not be worried by the emergence of disruptive technologies but focus on how to use them to add value to their services and the financial ecosystem, he noted that “There’s a major global shift in consumer behaviour. People across many diverse countries and cultures are evolving a digital lifestyle.”

According to the chairman, CeBIH, Mr. Dele Adeyinka, the payment industry had witnessed the entry of non-bank players in recent times.

He stressed the need for financial institutions to play their part in the quest to move the nation’s e-payment space to the next level, noting that “It is becoming evident that the key to success in this digital world is to evolve continuously in order to remain competitive and relevant to consumers. The way in which individuals and businesses accept payment is quickly becoming the next battleground of innovation. Consumers are now surrounded by a wealth of technologies”.

“The payment industry has recently witnessed the entry of diverse non-bank digital players – both technology giants and start-ups who are presenting increased competition for banks.

Adeyinka added that “While these categories of entrants have generally not been major threats to the banking and payments industry in the past, the aggressive nature of the digital players, the prominence of smartphones as a channel and rapidly evolving customer expectations have all made a difference in recent past.

“To maintain the customer relationships and stay relevant, there is a need for all stakeholders to respond to these changes with new strategies, capabilities, and operating models,” he added.