In May 2016, the European Central Bank decided to stop issuing the 500 euro banknote. Experts, such as Deutsche Bank’s CEO John Cryan, believe this is just the beginning of a new development which could culminate in completely doing away with cash. This development raises the question as to whether physical currency will even be needed in the future. With perspective, the change to digital payment methods seems to already be a done deal.
For this reason GFT, in its role as an innovative technology partner of the financial sector, updated the analysis already executed in 2012 and determined once again the developments and perspectives for the global banking sector. The results of this international analysis provide direction for financial institutions and fintechs in making strategic decisions about forthcoming business models and digital payment methods of the future.
The digitisation of the financial sector strides ahead relentlessly. Supported by the now almost finished development of the mobile phone network and the parallel rising use of smartphones, the market growth for mobile transactions increases yearly. Nowadays, about half of the world’s population has access to fast mobile internet. For the circa seven billion humans living today there are close to two billion smartphones.
Accordingly, established financial institutions on one side and fintech start-ups on the other invest in digital business models and try to convince customers of their technical efficiency and security. Even in countries like Germany, where people have traditionally been attached to cash, mobile payment methods are gaining ground in the market. The ecosystem of the future is complex, global – but above all – digital. The spectrum of players and technologies is as versatile as the international and national guidelines and laws, for example for the protection of customer data. The whitepaper by GFT also gives an overview of the most relevant guidelines and provides a 360° analysis of the mobile payment market.
"Thanks to their infrastructure and the long-standing expertise with payment services, established credit institutions have the best prerequisites to occupy a central position in the future mobile ecosystem. At the same time, fintech start-ups with innovative business models for digital payment systems are pushing the market forward."
Bernd-Josef Kohl, Head of Consulting