The co-creation of payments technology will be an increasing feature of the financial services sector in coming years, the Commonwealth Bank of Australia and American Express have predicted.
Speaking at the CeBit Future of Payments conference in Sydney last week, Nick Aronson, general manager Transaction Banking, Institutional Banking and Markets at the Commonwealth Bank of Australia, said merchants have had a hand in co-designing almost all of the bank's recent payments devices, such as Albert, Pi, and Leo.
"We have shifted very quickly to a customer-focused design mindset," he said. "We recognised very early on in our [Albert design] journey that dictating terms to our merchant customers about how they should take payments was not going to be a long-term proposition for success in the marketplace.
"There has been quite a massive shift from the point-of-sale purchase being a place where the payment provider dictates to a merchant how to take a payment, to a place where we work very heavily with the merchant community to say, 'what is it that you want the customer experience to be?'
"It is all about the customer experience. Are we talking about queue busting, providing value-added services, speed of transaction ... [the merchants] know a hell of a lot more than we do."
Aronson said that in the development of its Albert next-generation EFTPOS terminal, the bank included a camera within the device so as to respond to merchants' desire to integrate social media with the payments process. By way of example, Aronson said one global luxury goods merchant has developed an app for Albert that allows customers to have a photo taken of their purchase and then uploaded to Facebook.
"At the same time, [the merchants] are collecting customer information," he said. "They want to get closer to the customer, so are actually collecting customer emails, Facebook profiles, and are looking at using that in subsequent marketing.
"Payment is no longer a discrete, stand-alone piece transaction which is dictated by the payment provider ... co-design is fundamental to the success of anybody in this space."
Corinne Ng, VP and GM, international payment options Australia at American Express International, said co-design and development is at the heart of growing the company's relationships with merchants.
By way of example, she said Amex has worked with Walmart to co-design and develop a new payments solution, the Bluebird card, a re-loadable prepaid debit card alternative. In less than one year, the initiative has seen 1 million accounts opened and AU$1 billion in transactions.
"Co-design and development is core; is fundamental," she said. "With Walmart and the Bluebird project ... we use technology to breathe life into the idea of financial inclusion."
Ng said that Amex has also sought work with sites such as Amazon and TripAdvisor to combine social media, online communities, big data analytics, geo-location and payments technology to create special offers that are redeemable within both merchants' bricks-and-mortar and online stores.
Earlier this year, the company further integrated payments into Twitter through a "tweet to pay" facility.
Kristie Atkins, director of sales at Amalgamated Holdings Limited — the owner of Event Cinemas and a number of hotel and resort brands — said that collaboration as well as co-design are increasingly common.
"One thing which has been really good, and which seems to be changing ... is we now have these organisations, including the CBA, providing the right people to work with our people, side by side, and with the integration process — they are not just going, 'here is the spec, off you go'. [Financial institutions] are actually resourcing alongside our team and getting the work done.
"Internally, for us, it also makes things a lot smoother, because you have sales and marketing working hand in hand with e-comm and IT, which doesn't happen that often."