Gadgets and Goodies
Tomorrow’s top 10 technologies

No-one has a reliable crystal ball, agrees GAVIN JONES, but as technology gets smarter and more convenient, it’s transforming personal and business banking.

Technology has had a huge impact on the financial sector, dramatically changing the way people manage both their personal and business finances. Two things drive the change – the opportunity to reduce costs and the chance to increase market share through innovation. And innovation never stops.

Of course, no one has a crystal ball to completely predict the future, but the fact remains that, as technology gets smarter and more convenient, numerous gadgets are coming together. The downside is that large financial institution systems could be compromised by technology driven terrorist activity. So, in any shift from physical to virtual terrorism where the damage is economic, tighter security is key.

Younger generations have a different view of privacy and information sharing; e-commerce is well established and is a prime area for future development. Here are ten innovative developments we can expect over the coming decade:

1. End of the PIN?
This smart technology is typified by the Barclaycard waterslide and monorail advertisements where customers simply wave their card at the payment machine. The on-card chip links to the reading machine and passes on all information, similar to an Oyster card for anyone used to London travel. Operating in this way, we could conceivably see the end of the PIN for low value items like packets of sweets. Customers would balance the theft risk against the value they store on their card with convenience and their attitude to risk, in the same way as you decide how much cash to carry around.

2. The e-Wallet
The mobile phone is the accessory that’s changing our world most. Mobiles are now more like pocket PCs. In several UK cities, people can pay for parking with their mobile phones. EWallets are the next logical step. The mobile becomes a top-up debit card, storing a pre-paid total (say, £100) which can be used to pay for goods and services. This limits any potential losses should the phone be lost or stolen.

3. Smart phone invoicing
Smart phones like the iPhone and its ubiquitous ‘apps’ will make it possible to raise and pay an invoice on the spot. For example, a plumber completes his work and instantly raises an invoice using his phone and a pre-drafted template complete with VAT number etc. This is then sent to the customer’s phone so they can accept the invoice and immediately settle the bill using their own phone, just as if the plumber had a mobile credit card reader.

4. Pocket bank branches
With supermarkets now offering banking as well as mobile phone services, we could soon see mobiles effectively acting as a “branch in the pocket”. Many people live and work away from the High Street. Customer convenience saw the rise first of telephone, then internet banking. If you can go online via your mobile, too, then travelling into town really becomes relegated to history. After all, who needs to be confined to branch location or opening hours? Convenience is king.

5. Biometric security
Fingerprint and iris scanners are becoming more widely used to identify people for security. As a result, they’re becoming less intrusive and cheaper. Use of an iris scanner in bank branches to identify customers would allow much faster service as well as offering better, more personal service with banking staff having your details available before you arrived at the counter. Usually, consumers relate faster service to a less personal approach but here, the cashier would have available personal details without asking the customer questions, making the customer feel recognised and valuable.

6. Café banking!
The potential of café (or tabletop) banking technology is huge. An internet-connected touch screen is built into the table surface allowing customers to meet with a financial adviser in the local coffee shop and have full access to all their accounts. The fact that you could meet in comfortable surroundings at a convenient location, without trying to peer at a screen held at just the wrong angle is a great mix of personal service and innovative technology. Check out Microsoft’s version on http://www.microsoft.com/surface/en/us/Pages/Product/WhatIs.aspx.

7. Micro-banking
Social network peer-to-peer banking is the next step in microcredit. Popular in developing countries and (strangely) the US, Britain has yet to embrace microcredit. However, rather than pay high interest rates to a large corporate, microcredit works by borrowing a couple of quid from a large group of people at an agreed rate. The concept is bound to get more and more appealing as short term credit becomes increasingly expensive. The interest payments are kept within the social network.

8. Customised marketing
Very much in keeping with the Tom Cruise film Minority Report, there’s potential to offer you targeted products as you walk past your local branch because you haven’t been in for a few months simply by tracking your phone as you move from area to area. The technology uses GPS just like satellite navigation does but a phone is able to identify who you are as well as where you are. The Facebook generation, less concerned about privacy, are most likely to embrace this as a good thing.

9. Cashing out
Like cheques, cash will be confined to history as card and phone technologies become a safer and more convenient store of wealth and payment mechanism. Cash isn’t robust, you need to print new notes regularly, plus, large amounts of cash attract thieves. Using an e-wallet actually has benefits to all sides.

10. Risk-based authentication
This is a technology which is just taking off but could be a big benefit for transaction processing. When a transaction is made, a number of judgements are made as to the value of the transaction and how it is being made. A customer using a PC in an internet café will be asked additional security questions than if they were using their home PC, for example.

GAVIN JONES is Delivery Director Scotland, Financial Services, Logica

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