UK's Digital Economy: The Future of Payments

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K. Is a country that is adopted many payments innovations faster than most and it has risen to the challenge set by the European Union's Second Payment Services Directive which requires banks to open up their payments infrastructure. The resulting open banking promises to unleash even greater innovation by reducing the barriers of entry to the payment services market the UK's experience therefore is likely to foreshadow the evolution of payment systems around the world. My guests this month are Adrian. Buckle head of research portrayed dissociation. Uk Finance Steve Everett Managing Director of payments for global transaction banking Lloyds Banking Group and Fiona Roach Canning Co founder of UK based Fintech pollinate. I started our conversation by asking Adrian. What explains the apparent outbursts of innovation around payments in recent history? That hasn't been a lot of innovation. I'm payments in recent years. Although I think the changes in consumer behavior the patterns of payments that we've been seeing over the last five years probably driven more by innovations. That happened in the five years before that because people are very much creatures of habit when it comes to the way that they pay for things. It takes a lot for people to decide to change the way they pay and slow for example. The things that we've been seeing really growing over the last five years one of the key examples would be contactless payments and that has really exploded since about two thousand fifteen but actually the first contact and contactless cards were introduced in two thousand seven. So it's taken a long time for consumers to come round to the idea of contactless cards and then really take them and use them in a huge way such that by twenty eighteen. I think one in five payments made by consumers were made using contactless cards so we have seen some real innovations and real changes some of that due to changes in technology so for example contactless technology coming in but also mobile devices. And the fact that we're now all essentially carrying a mini computer around the time which gives us access to a huge amount of data and huge mountain information but also regulatory changes which have opened up the information that banks provide access to in the ways in which we can interact with all banks and those are going to provide changes that perhaps haven't had an impact on consumer behavior in recent years but are likely to be really key defining factors in the way that we pay for things over the next five or ten years

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