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• Consumer payment behavior
• Opportunities and challenges facing providers in the space
• Innovations in payments and payment technology
• Regulatory landscape facing the industry
In his keynote speech, Richard Oliver, Federal Reserve Bank of Atlanta, stated that during the late twentieth century, the payments industry was in an environment where banks faced little competition for consumers; the pace of innovation was slow; the government did not intervene much; and consumers did not require a lot from their payment providers. However, over the past decade, that environment dramatically shifted: Nonbank players began to aggressively compete with banks to provide payment services; the pace of innovation accelerated as new technologies emerged; government regulations became stricter; and consumers demanded more from their payment providers.
Katy Jacob, Federal Reserve Bank of Chicago, noted that the rising costs of providing payment services are indeed a significant industry challenge. While many consumers have weathered economic setbacks that have made them more aware of the terms of their relationships with their payment providers, many of their payment preferences have remained the same.
Sujit Chakravorti, The Clearing House, reiterated that customers developed high expectations from their payment options in the past and they continue to expect rewards from using payment instruments like credit cards.
Dave Wentker, Visa, argued that the prevalence of mobile phones and smartphones has created an immense opportunity for payment providers, as long as those providers choose the right time to invest in infrastructure developments—i.e., when it is plausible to achieve a critical mass.
[Laura] Chambers [of PayPal] said that much of Internet commerce is actually conducted via mobile devices, as opposed to computers, so sales completed on mobile devices may actually be underreported. Chambers also remarked that mobile payments change the nature of competition, since payment providers are competing not only with each other for consumers’ time, but also with nonfinancial software companies that make entertainment applications, such as games.