17 October 2017
Alexander Peschkoff


Alexander Peschkoff - TEDIPAY

119Posts 540,301Views 617Comments
Innovation in Financial Services

Innovation in Financial Services

A discussion of trends in innovation management within financial institutions, and the key processes, technology and cultural shifts driving innovation.

Show me yours

13 March 2013  |  2971 views  |  1

Recently, Dave Birch confirmed what I learnt the hard way at the beginning of the TEDIPAY journey: consumers are wrong. That was why three years ago we decided to follow Steve Job's advice who famously said that "it isn’t the consumers’ job to know what they want." 

It seems that more and more companies have started to realize that "not only do customers not care about security, they will actively switch to service with less security if it is more convenient or cheaper despite telling researchers that they value security and think that security is important." 

It's not about cutting corners, it's about delivering unparalleled user experience. Barclays did it with Pingit, Bankinter did it with NFC payments - I was critical of both, btw, from the security point of view, but I am now seeing the other (very attractive) side of the medal much clearer.

Coming back to the main subject, current merchant-oriented mobile payment solutions are "lemminged" around dongles. That's where they get it all wrong, in my opinion. Yes, those companies did raise dozens of millions in funding; yet, half of them are not likely to be around in a few years' time, when the "dongle bubble" bursts.

Think about "casual merchant". If card payments can be done via m-commerce solution on a mobile phone, why bother paying for the dongle (and, in some cases, paying a monthly fee too) and then carry it around and fiddle with it?

The cost difference - on the transaction level - between a dongle and the "show me your card" payment method is way below 1% - a "rounding error" even for taxi drivers (whom customers regularly tip 10-15%). One could argue about fraud and chargebacks - yet, there are effective means to deal with that.

Unlike pure MOTO, the "show me your card" scenario is not, strictly speaking, "card/cardholder not present" as merchant does get to see both the cardholder and the card. That's a crucial difference, if one plays it right...

The mobile payments market is (gradually, for now) moving away from "secure element" and "EMV" to "convenient ubiquity". There will be many dust-covered dongles. And tons of "something/someone present" transactions. Watch this space...


Comments: (1)

Ketharaman Swaminathan
Ketharaman Swaminathan - GTM360 Marketing Solutions - Pune | 15 March, 2013, 18:43

Welcome to the "customers want convenience and don't want lack of security" club, just as I'd commented here

Be the first to give this comment the thumbs up 0 thumb ups! (Log in to thumb up)
Comment on this story (membership required)

Latest posts from Alexander

Second bite of Apple

24 September 2017  |  3573 views  |  0 comments | recomends Recommends 0 TagsPaymentsInnovationGroupFintech innovation and startups

Loyalty is a four-letter word

06 May 2017  |  5788 views  |  1 comments | recomends Recommends 1 TagsRetail bankingStart upsGroupFintech innovation and startups

Before they move us, we move them

14 April 2017  |  5981 views  |  2 comments | recomends Recommends 0 TagsMobile & onlineInnovationGroupFuturistic Banking

Tap-n-PIN mystery

23 February 2017  |  4306 views  |  3 comments | recomends Recommends 0 TagsCardsPaymentsGroupFintech innovation and startups

Alexander's profile

job title CEO
location London
member since 2012
Summary profile See full profile »
I am the co-founder and CEO of TEDIPAY, the company that is bringing to the market a game-changing platform for secure mobile transactions.

Alexander's expertise

Member since 2012
115 posts617 comments
What Alexander reads

Who's commenting on Alexander's posts

Paul Love
Ketharaman Swaminathan
Anthony Pickup
Alex Lithgow Smith