Tag: smartphone payments

Riskskill draws attention to risks in mobile payments field

Mobile payments have become quite popular with consumers, which also mean that they have become a bigger focus for businesses looking to engage with tech-savvy people. Many consumers praise mobile payments because of their simplistic and convenient nature. The mobile commerce field is, however, rife with risks that often go completely unnoticed by consumers. Riskskill, a leading corporate risk consultancy firm, has been working to raise awareness of the risks that exist in the mobile commerce space for some time and suggests that companies face a wide range of dangers when adopting mobile payments.

Study highlights problems with rapid pace of technological progress

Riskskill has released a new study concerning the risks that exist in the mobile payments sector. The study highlights several areas wherein these risks are most pronounced. One of these sectors concerns the rate at which technology progresses and the rate at which mobile commerce itself is growing. The firm suggests that mobile payments will reach $1 trillion in global transactions by 2015 and this growth could outpace the availability of reliable infrastructure. Exhausting existing infrastructure could inhibit future growth and make mobile payments significantly less efficient than they currently are.

Mobile payments may outpace standards and regulations

Another field of concern has to do with the current standards that are in place to regulate mobile payments. These standards tend to vary from country to country and are meant to ensure that consumers are protected while participating in mobile commerce. The problem, however, is that these standards may soon become outdated due to the rapid growth of mobile commerce itself. The rapid evolution of technology is putting further strain on these standards, but many countries have yet to adapt to the changing needs of the mobile commerce space. Inadequate standards could leave consumers open to exploitation.

Hackers target mobile commerce

Consumers are also faced with the risks associated with hacking. Mobile payments have become a very attractive subject to malicious groups that wish to exploit financial information. These risks do not disappear simply because they attract relatively little attention and Riskskill believes that hacking could be a significant problem that has yet to be fully addressed.

The financial institutions are hoping to work together so that smartphone transactions can take on credit card systems.

Six of the biggest banks in Poland have announced that they will be working together in order to create a common standard for mobile payments which would result in a system that could place the dominance of traditional credit card giants at risk.

They are hoping that this will knock the wind out of Visa and MasterCard that currently lead the way in the country.

The banks that are involved in this partnership include Bank Zachodni WBK, Bank Millennium, ING Bank Śląski, Alior Bank, PKO Bank Polsk, and BRE Bank. As a group, the banks working toward this mobile payments system make up 70 percent of the electronic banking market in Poland. They will be working to come up with the standard under the Polish regulator in this sector.

The mobile payments offering will be based on the IKO app from PKO Bank, which was just launched in March.

The mobile payments system will allow consumers in Poland to be able to complete purchase transactions while in stores, and will be able to make withdrawals from ATMs by entering a unique code that the app has generated. Consumers will also be able to use the app to send money to recipients simply by entering in their smartphone number in a way that has been compared to the UK’s Barklays Pingit service.

The use of this mobile payments system allows consumers to be able to make electronic transactions without the requirement of a credit card. This was a fact that Visa was “not happy about,” according to Wojciech Bolanowsky, from PKO.

At the same time, Boguslaw Kott, the CEO of Bank Millennium, has admitted quite openly that one of the purposes of the bank group in creating this mobile payments system is to challenge the rein of Visa and MasterCard. Kott was quoted to say that “This will be a more competitive system compared to the credit card system. The credit card system will probably be put under a question mark in the future.”