I'm taking the months of December and January to take a broader view and a deeper dive into what drives innovation in the payments industry.
Through interviews and discussion, I want to understand how leaders from across the payments industry view payment innovation. What does innovation look like to a payment services provider? A payments processor? A terminal manufacturer? A gas pump maker? A small merchant, a large merchant. How does each view the direction of payment innovation?
I don't expect answers to all of my questions because the list is long. They include:
- What are the next steps in payment innovation?
- What innovations does the industry need?
- What are the barriers to payment innovation?
- Where should transaction innovation focus - on the payment itself or on the value exchange around it, i.e. incentives, marketing, customer relationship, and consumer experience?
- What innovations are your customers demanding?
- Who do you see as the leaders in payment innovation?
- How much is the cost of payment acceptance, and merchant concerns over cost, driving or inhibiting innovation?
- If you had a clean sheet of paper, what would you draw to improve the payments industry or transaction flow?
- How do you view mobile? How long will mobile be a separate channel? When is it all mobile?
- What will the role of the mobile operators be in 2017 around payments?
- What parts of the payments industry/process are most resistant to change? How does that impact what you're trying to do?
- How do you see the payments industry in five years? What's going to be the same? What's going to be different? Of the new players, who's on the stage? Who isn't? What's happened to the incumbents?
- Of the major inhibitors to innovation, what percentage can be addressed via technology? Business barriers? Regulatory?
- Who “owns” innovation in your enterprise? Where are the accountabilities, collaborations, reporting structures? Is it skunk works/grass roots, driven from the top by mandate, some other mechanism?
- To what extent does innovation happen at the interfaces between your organization and its suppliers/partners/developers/customers? I.e., is it a “solo” function, managed exclusively in internal structures, or is there a lot going on at the interfaces/edges of the organization?
- How does the organization view failure?
- If someone came to you with a breakthrough innovation, how would they sell it? E.g., if Steve Jobs walked in with an iPhone in 2005 or an iPad in 2008, how would they get through the front door (or even would they)? Who would they talk to? How would they be received?
I fully expect the discussions to include, as appropriate, EMV, PCI, impacts of the Durbin amendment, the merchant litigation, and PIN debit.
These questions arise from my own perspective on essential transaction flows: at the points of transaction origination, acceptance, and in the actual movement of money. There's a great deal of activity around the first two, some of it important, some of it a waste of time. Moving money is harder.
All three areas rely on enabling services - security, identity, authentication, marketing and social integration, mobility among others - where innovation is needed.
After each interview, I'll post what I learn. By the end, I'll have 20 or more of these discussions assembled and posted. Based on those conversations, I plan to produce a Payments Innovation Map to identify the edges where innovation's underway and needs to take place. Along with that map, a summary of what I've found, and my assessment on those findings, will go online.
As far as practical, the discussions will be in person. Given the time, I'd much rather skip the concall.
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