Are there good reasons for this?
Looking at the payments sector, you have very large slow moving clients who until the past decade have been entrenched in a risk averse position. This has lead to the rise of compliance, propriety standards and data silos.
In effect the industry built walls around itself and then asked the consumer to come to it. The consumer, who had little choice at the time took the best offer on the table.
In a sub prime housing bubble, with strong profits and even stronger bonuses, what motivation was there for change? The collective wisdom of all in the industry was that the security offered by existing infrastructure and Gatekeepers worked well.
We had an evolutionary change when Generation X revealed to the world it's new age. The Internet brought The Information age. Sure enough, 5 years later most banks were thinking about online banking. A typically slow, but measured reaction given the sheer amount of security required.
Now Generation Y has revealed its own masterpiece. We call it Social Media. No doubt like "World Wide Web" and "Netscape" Social Media and 2.0 are terms that will die with the buzz that created them. Yet when the dust settles what will remain is the value.
The Generation Y consumer's core values differ greatly from the Payments Industry. Generation Y wants instant access, 24/7 and to own the interaction. The risk of not granting this wish is that Generation Y are not shy about rubbishing bad service. Or on the flip side praising good service.
How can the payments industry take advantage? This is the challenge of innovation.
Posts
