Fraud and fintech partnerships; big data and blockchain—all are among the hottest topics in payments—and will continue to be major forces shaping the industry in 2017, according to a new report from Vantiv Inc. The first installment of the payment processor and technology solutions provider’s Trends to Watch in 2017—focused on financial institutions—tabbed those four areas as especially important points of emphasis for banks in the New Year.
“In 2017, we expect to see more payments go mobile, digital and cross-border, increasing the importance of real-time data analytics, as well as the need for robust yet nimble security and fraud prevention strategies,” said Bill Hampton, senior vice president and general manager of financial institution services, Vantiv.
Among the key points in the Vantiv report:
- Fraud is evolving in response to EMV. Up to $10 billion in fraud will be committed between now and 2020, with an increasing percentage comprised of card-not-present Cooperation among stakeholders will be key to increasing security.
- More legacy financial institutions will partner with fintech startups in 2017 to leverage their services and appeal to a younger audience. Banks need to provide value to consumers and instill trust to help increase brand loyalty. Forty-two percent of millennials are likely to switch financial institutions for convenience, according to Vantiv.
- Financial institutions need to leverage big data to better serve their customers. Consumers expect their financial institution to be able to provide real-time recommendations based on changes in their financial profile.
- Blockchain will change everything. With distributed ledgers enabling transactions to occur on a network instantaneously without the middle man, financial institutions are able to speed up transactions and reduce costs while lowering the risk of fraud.
This marks the second year Vantiv has projected trends for the upcoming year for its business units, including financial institutions, e-commerce, integrated payments and merchant services. Vantiv will release more trend reports for 2017 throughout December and January, the company said.
- Viewpoint: The Year in Review and a Look Ahead to 2017
- EMV: The Ripple Effects of Fraud
- Money20/20: Cordray Says CFPB No Foe of Fintech
Image Credits: iStock/fatido