When we think of the term ‘vikings’ today, we often conjure images of great warriors – conquerors as opposed to the conquered.
History paints a picture of Scandinavian expansion throughout much of the world via advanced sailing and navigational skills.
It is no secret that Scandinavia often still leads when it comes to innovation, efficiency and equality. So then it shouldn’t come as a surprise that while the rest of the world is in its relative infancy when it comes to payment, Scandinavia has already well and truly adopted a new system of mobile payments.
As much of the world outside of Scandinavia starts to realise the distinct benefits of mobile payments, it’s not the banks who are rushing to make the world of payments easier for its customers. Rather, it’s third-party companies. In China, AliPay is making cash obsolete, whilst in the US the likes of PayPal (Venmo), Apple (Apple Pay) and Walmart are battling it out to gain mass customer share – leaving banks (like JP Morgan) in the wake.
Seemingly last on the hitlist, Facebook and Apple have been seen recently making designs on Scandinavia. What does this mean for the banks of Scandinavia, who, to date, are the only banks in the world to have achieved true mobile payments success? They summon the attitude of their viking ancestors.
Elisabeth Haug, Vice President of the leading mobile wallet in Norway, Vipps, said that despite knowing competition from overseas was undoubtedly on the horizon, “we will not lie in the app-graveyard. We will give Apple and Facebook a real fight once they enter the market”.
We have often said that banks lack foresight when it comes to mobile payments. Often, because no immediate monetary benefit is obvious, banks have lacked the drive to properly create and execute better payment channels – in this case, mobile payments channels – for their customers. Haug makes the point that we’ve been trying to also convey, that data = power. She says that data enables banks to predict what’s going to happen next. That translates to insight on what channels customers will need next or what products they’re likely to need help with (for example: a line of credit, a lucrative mortgage, etc.) The power of this data cannot be underestimated.
Right now, current payment services regulations have protected European banks to some extent. It’s harder for third-parties to get access to what they need to truly run banks off their tracks. A couple of months ago though, we had a sneak preview of what banks in the EU will face post the second payment services directive, PSD2. This came courtesy of Google’s TEZ launching in India, post their Unified Payments Interface allowing the access Google needed to directly tap into customer bank accounts.
The large third-parties are all ramping up their mobile payments efforts and are no doubt chomping at the bit to unleash all the bells and whistles needed to make bank customers give up on their bank’s payments channels. Banks like those in Scandinavia are best-positioned to maintain (and expand) their territory with robust mobile payments strategies and customer adoption in place.
Other banks, particularly those in Europe, still certainly have an opportunity to create their own mobile payments strategy. We have spoken at length about the formula for mobile payments success and the steps required for banks to replicate the success of those in Scandinavia.
In our experience as the first mobile payments company to launch in Norway, there are five key things banks can do in order to “think like a viking” and secure their territory.
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