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Retail Payments: Preparing for The Future (Strategy Focus)

Product Type: Market Research Report
Published by: Datamonitor
Published: October 2006
Product Code: R313-17285
Description
Introduction

Going forward, the payments industry in Europe is going to undergo dramatic changes. As a result, players in the industry are under pressure to address their payments strategies in order to position themselves for the future.

Scope
  • Primarily covers the European payments market
  • Areas covered include product innovation, infrastructure investments for future business growth and payments security issues
Highlights

Banks and card issuers need to increase the volume of payments that go through their networks in order to benefit from scale economies and efficiencies. However, they are also looking at ways to attract new customer segments, for example by developing new products and tapping unbanked niches in order to gain new markets and grow margins.

SEPA is likely to change the European banking model insofar as customers with accounts in multiple countries are likely to consolidate to just one. Once this becomes a reality, there is likely to be considerable competition between banks and card issuers to become the new owner of such relationships.

Electronic payments volumes will continue to increase, driven by the move away from traditional cash and check markets, as well as the rise in new electronic payment instruments. As other methods of payment drop off, electronic fraud will become increasingly attractive to criminals so steps must be taken to minimize the risk and tackle fraud.

Reasons to Purchase
  • Gain visibility into the dynamics of the European retail payments market
  • Gain market insight to assist in your strategic planning and go-to-market strategy
Table of Contents
DATAMONITOR VIEW
CATALYST
SUMMARY
METHODOLOGY


ANALYSIS
Product innovation in the payments market is critical for developing margins and markets
Prepaid cards facilitate the conversion of previously unviable market segments to electronic payments
Contactless functionality has significant potential to take share from cash dominated markets
Banks are developing multi-functional products in order to improve both customer acquisition and retention
Customer segmentation - a card for every niche
The threat that online and mobile network payment providers pose to the incumbent industry is very real
SEPA is driving banks to examine how to leverage spend beyond simply SEPA compliance
Institutions' infrastructure investments in SEPA must be aligned with their wider business goals
Banks should consider how SEPA investments will impact future product innovation potential
Institutions must develop sourcing strategies that will support their future payments vision
Sourcing strategies need to be aligned with both their business and cost focus
Legacy payment instruments such as checks will start to be phased out
The issue of payments fraud will become even more critical as the industry opens up
Payments fraud is a moving target that institutions must continuously address
As fraudsters become more sophisticated, the case for transaction monitoring grows

APPENDIX
Further reading
Ask the analyst


List of Figures
Figure 1: European retail banks' payment project priorities
Figure 2: European retail banks' payment project priorities
Figure 3: Retail banks' fraud priority areas
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