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What Apple's announcement means for the payments industry

Paul Henaghan, Managing Director, APAC at ACI Worldwide | Sept. 10, 2014
Apple Pay is expected to affect banks and retailers. Find out how.

What does this mean for banks?
Similarly to retailers, banks should really use this event as a catalyst to review their strategy. Most obviously, they need to decide how closely they want to align with Apple. Clearly many of the larger banks have made that decision already. As with retailers, such a decision should be encompassed within a broader strategy around the omni-channel consumer touch points in general, and mobile payments in particular. Allowing their cards and accounts to be added as payment sources, and the extent to which they would be seen as 'deeply integrated' or 'preferred' participants, may play a role in how they are perceived, at least by a certain segment of the population. And certainly they need to ensure they have the appropriate relationship with the American Express, MasterCard and Visa to support their tokenization schemes. Looking forward, banks should also plan to extend their mobile banking platforms to support new payments options.

If one stands back and assesses the situation objectively, one must recognize that the recent news is but one more disruption in a significantly disrupted industry. And it won't be the last. We can be sure that the other players have their own strategies under development. Banks and retailers can react defensively, looking to see how to protect their current market share, or they can see the rapid pace of disruption as an opportunity to differentiate themselves, capture new market share, and extend their brand in new ways.

In a highly and continuously disrupted payments environment, success demands an optimized payments platform that has the breadth, depth and flexibility to support the business priorities and timing. Building on the right platform, banks and retailers can integrate new capabilities (such as Apple's mobile payments, amongst others) while remaining true to their architecture, their brand and their corporate strategy.

In conclusion: It's clear that Apple is taking mobile payments seriously. And as one of the most significant influencers in the industry, we had all better sit up and take note. They've played a masterful stroke. But remember — keep it true to your own strategy.


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