16/07/2015

By Andreas Pouros, COO and co-founder at Greenlight Digital

How we pay for stuff is changing. In a relatively short period of time, shoppers have become accustomed to waiving a card over a terminal to make small purchases. Last year alone, Brits spent more than £2.3 billion using contactless cards and that figure looks set to rise significantly this year as a growing number of retailers and consumer embrace the contactless card.

With this month’s launch of Apple Pay, contactless payments look set to make the leap to mobile. Hotly-anticipated among retailers, Apple Pay will make paying for goods in-store a simple matter of holding your phone up to a card reader and tapping the Touch ID button.

Not only is Apple Pay pretty quick and easy to use in-store, it promises to bring a whole new level of mobility to online shopping, presuming you have the latest iPhone of course. By removing the need to fill out forms with the same address and payment information, Apple Pay could help online retailers to streamline the shopping journey and limit the level of basket abandonment at the final hurdle.

But despite all the industry hype, Apple Pay is merely a footnote in the evolution of contactless payments. It is not the ‘holy grail’ of contactless payments and will not change how we choose to pay.

In order for payments to become truly ‘contactless’ we need to lose the final hurdle; we must end our reliance on a physical card or device to make payments. Apple Pay hasn’t been designed to solve this particular challenge, but a growing number of technology companies are taking on this challenge.

Earlier this year, a Swedish company launched a large-scale trial of implanted microchips. Around 700 people in Stockholm were ‘chipped’ with a small RFID chip of the kind usually found in a contactless credit or travel card, allowing them to make payments by waiving their hands over a sensor. While this is surely the most elegant solution it remain far too ‘sci-fi’ for most people.

Biometric payments is another interesting area of development – and with no implants involved. In the UK a number of banks are already experimenting with facial, fingerprint, and finger vein recognition, meaning consumers could soon make payments by taking a selfie. This much less invasive approach is more likely to gain mass acceptance in the short term

The future of payments is an exciting and imaginative territory and it will be interesting to see how fast retailers and consumers embrace new ways to pay.