With 2015 well underway, everyone is looking forward to what the year will hold for finance and technology. As the economy continues to recover and technology evolves at a rapid pace, can we expect to see growth among new payments systems in the banking industry in the months to come? What technological innovations will rise to the forefront to enhance the customer experience? ‘Challenger’ was certainly the buzzword for 2014, but what can we expect to see tech-wise from both traditional as well as new entrants to the market in 2015?

Payments

Contactless payment has undoubtedly seen a surge in popularity in the 2014, both in the UK and worldwide. The successful performance of this new technology has led to an openness amongst consumers for new payment options where perhaps they may have been wary in straying from cash or chip and pin in the past. Expect contactless payments to make further inroads in 2015 and mobile payments to follow suit.

As this engaged attitude from the market boosts both contactless and mobile payments, we could begin to see an interesting dynamic develop between telecoms companies and banks. Potential alliances between the big players could form much in the same way that retailers and banks have aligned in the past in order to leverage their loyalty bases. With some big buyouts already completed in the telecoms industry, their new strategies may be to team up and gain a piece of the pie in the payments market.

Technological Innovation

If your buzzword wasn’t challenger in 2014, then it may have been big data instead. Whilst innovation in 2015 is expected, the year ahead will still hold some of the same challenges that organisations have previously faced.

Mastering the collation of various information services into a coherent form that can be analysed and linked back to a customer remains a hurdle for many. Having the data available in a manageable form so that analysis can take place will remain of paramount importance. Getting this data collation right will then allow companies to extract meaningful, valuable data and put it to good use. Expect smart analytics and the integration of new data sources to become increasingly hot topics in 2015.

Another recent innovation is biometrics. Biometrics have now gone mainstream following the introduction of a fingerprint scanner on new Apple products. 2015 could be the year in which we see the potential of biometrics and smartphone technology collide. Thumbprint security features for online banking apps seems to be the next step as a solution to two factor authentication, but it needn’t stop there. Using the camera for facial recognition, behavioural choices based on pictograms and even passcodes linked to distinctive typing styles and timings, could also be introduced.

Banking – new entrants

In the past year, the surge of new entrants into the banking sector has been matched by the surge of monumental investment from the big banks in their digital offering. Unburdened by legacy systems, challenger brands have put progress in the banking sector on an accelerated course. Eased regulation and capital requirements will mean a steady flow of new brands looking to make their mark on the market. This increased competition will in turn have a positive impact on the whole banking sector as customer driven innovation and increased use of digital channels become a priority on both sides.

Regulation

The financial world waits with anticipation on a so far unmoving interest rate. Should the rate finally go up, what will the impact be on consumers ability to service debt? Near prime lenders have thrived in the past 5-6 years, but an interest rate rise could mean their business may feel the impact. While recent comments from Mark Carney have caused many to speculate that the rise may come in 2016, the coming year will see a time of preparation for various lenders as speculation mounts.

Affordability

Perhaps a bold prediction for the next year, but certainly something we may see in the years to come, is the emergence of a single credit facility offering a range of features for the highly digitised modern FS customer. The development of a true customer view could lead to the demise of day to day standard and separate credit products (e.g overdraft, credit card, loan, etc) and the equivalent of a single secured line of credit could emerge that the customer can draw down on by card. This will take considerable product innovation in the next few years with one brand perhaps acting as the catalyst for major change.

While these are some of many speculations for the year ahead, it is clear that 2015 will act as a springboard to a new age of technological innovation in finance. With public opinion moving ever favourably towards efficient digital services, it will be interesting to see which brands will take the lead and bring about the digital revolution.