7 Key Trends That’ll Impact eCommerce in 2016

- Jayshankar Joshi, SME – Transformation service Line, Opus Consulting Solutions

M-Wallets will rule

Touch based mobile wallets like Android Pay, Apple Pay and even the OEM specific solutions of Samsung Pay and, recently launched, LG Pay have the potential to revolutionize our shopping experience by streamlining the payment procedure from the plethora of bank cards to one simple tap on an NFC reader. In the context of the Indian scenario expect to see proliferation of wallets like PayTM, which will focus on providing convenience to the customer while taking care of their security concerns.

Payment banks thrive amongst the unbanked and the under-banked

While the largest population of under-banked and the unbanked citizens may be in remote locations, in the big cities the younger members will choose to open mobile banking accounts with a payments bank. Mobile banking can also open up the  untapped tier III cities for the ecommerce sector.

Jayshankar Joshi SME – Transformation service Line, Opus Consulting Solutions

New payments banks that have neither the reachability nor the requisite IT infrastructure will partner with existing telecom companies, pre-paid card issuers or third party payment-service providers with connectivity in rural areas. These alliances will provide a cheaper and faster way to deployservices to customers.

Security to become primary technology driver

The rapid adoption of biometrics authentication in mobile payments offers an opportunity for payment-service providers to provide an easier and more convenient authentication mechanism for access to iPhone electronic wallet credentials than having to remember and type a PIN. This convenience would eventually make this a preferred method for authentication, especially for Generation M (Millennials with a strong preference for mobiles). Fingerprint technology will become quite well accepted compared to other biometric-identification technologies like hand or palm geometry, eye-iris scans or facial characters. Biometric authentication and tokenization will make security in NFC transactions far superior to any other method.

Digital currency will ruffle the remittance industry

Penetration of Digital Currency as a main-stream payment instrument will test the regulatory waters across the globe but will gaintraction. Globally, most financial institutions are focusing on blockchain: the technology that underpins the bitcoin virtual currency. For bitcoin, the blockchain will act as a globally-distributed ledger that logs transactions. The technology will verify each deal that takes place with respect to bitcoin. This will allow people to collaborate without having to go through a neutral central authority.

Technology companies make inroads into banking and payment services

Technology companies like Apple, Facebook, Google will embed payment services in their overall customer experience. Typical examples are Apple launching P2P payments, payment services being enabled through WhatsApp, Facebook incorporating a Buy button for Facebook shopping.

Start-up community will force banks to innovate

Industry giants like BBVA, Rabobank, Wells Fargo, Barclays, Lloyds Banking Group, Bank of Ireland, Commerzbank, UniCredit, Credit Agricole, and many others have chosen to set up startup programs to incubate FinTech companies. While this as a global trend has been catching up, but 2016 should see Indian banks also jumping onto the bandwagon.

Predictive analytics will drive loyalty and reward programs

Today customer’s location is not important – he could be physically in a store or shopping online on his tablet, but the analytics based on his browsing habits, checkout completion rate and type of payment method he is using will provide data points that help retailers make rewards programs more relevant to individual consumers.