In the past few months, a couple of newsstories from Sweden and the United Kingdom have come out that mayprovide a look into the not too distant future for payments.
In Sweden, it was announced that a local daily newspaper, theSituation Sthlm, would be sold by homeless persons equipped withmobile point-of-sale (mPOS) devices provided by iZettle. Homelesspeople have long served as the distribution network for the paper,but as Swedish consumers use cash less and less (cash withdrawalsin Sweden between 2008 and 2012 declined by a compound annualgrowth rate or CAGR of -7.14%, according to the Bank forInternational Settlements), the paper needed to add payment card acceptance tomaintain sales.
In the U.K., it was announced that the Royal British Legion wouldconduct a trial of donation tins equipped with Near FieldCommunication (NFC) technology in Birmingham, England’s secondlargest city, allowing consumers to tap their mobile phones againstthe tins to donate to the Poppy appeal, a charity initiative tosupport active and retired military personnel. The Royal BritishLegion is launching the new donation tins in response to decliningcash use as well as the technology’s ability to collect additionalinformation about payers. Rupert Potter, Director of Strategy atPaythru, told Finextra, the British financial services news site,that by incorporating NFC payments the Royal British Legion should”increase the number and size of donations [and]allow Royal British Legion to collect gift-aid on donations and tocollect contact details for donors.”
Cash use remains strong in developing markets, but consumers inmature payment markets are using and consequently carrying lesscash than before, so staying current with consumer payment trendsis vital to the success of firms and charities like Situation Sthlmand the Royal British Legion that largely accept small-tickettransactions. mPOS devices like iZettle, PayPal Here, mPowa amongmany others are one possibility, and utilizing emerging paymenttechnologies like NFC and contactless is another.
While each mPOS solution and emerging payment technology has itsadvantages and disadvantages, both methods represent very effectivemeans of shifting traditionally cash-based transactions toelectronic payments. According to Mercator Advisory Group’s 2013CustomerMonitor Survey Series, the leading influence in using cashacross age and income demographic groups was that cash was moreconvenient for small amounts, with nearly 79% of respondentsstating so.
Although only time will tell if the moves by Situation Sthlm andthe Royal British Legion are successful, they do give us a glimpseof what might be in the near future given present consumer paymenttrends. Probably not this holiday season, but it could be soon thatrather than large donation tins or buckets, Salvation Armyvolunteers dressed as Santa Claus will be ringing their bells inone hand and either accepting card payments through mPOS devices orprocessing NFC and or contactless payments with the otherhand.
