The Future of the Payments Industry
The money transfer and payments industry is changing, and it is doing so at a rapid rate. Although remittances have naturally spanned the globe since inception, the market is now entering the digital. In fact, it already has. This new market is about to explode, and companies can either choose to ride the imminent wave, or be left behind to drown. The time to enter is now.
Companies are rapidly beginning to understand that they have to be online. A digital presence is no longer a convenient perk, but a requisite characteristic of a successful business. Personal word of mouth is no longer sufficient. The Internet is where potential customers go to research companies. It is where they go to find companies. And if a Google search yields no results, you can consider yourself a ghost. Additionally, the online presence must operate with aesthetics and high functionality. 46% of online users will not return to a site that is not working properly. If your website is down or if your website is subpar, customers will instinctively move along. And this isn’t their loss. It’s yours.
Companies that still resist the move to the digital, please take heed. Are money-transfer customers really online? Yes. Is your specific audience really there? Most certainly. 81% of U.S. adults use the Internet and 61% of U.S. consumers believe mobile payments will overtake cash. The percentage of U.S. smartphone owners already using mobile banking features is 57%, and you can expect that to rise. Across the world, demographics are changing. Online adults spend 15 hours per week online. Affluent millenials spend 40. This 167% increase is extremely significant. By 2014, mobile Internet usage will overtake desktop usage, and accompanying this change will be an ever-increasing demand for relevant mobile services.
By the year 2017, mobile banking will hit 1 billion users and global mobile payments will reach $1.3 trillion. The massive switch to digital is not a forecast. It is a reality. And the longer companies hold out, the more difficult (and, potentially, less possible) it will be to enter this realm of the market at a later date. If you build it, people will come. And if you don’t build it, someone else will.
A great example of this is Xoom Corporation, an online money transfer company based in San Francisco. With Xoom’s bank deposit services, customers can send money directly into bank accounts in over 30 countries. Its consumer remittances, among other related services, are established on every continent, with Antarctica the only exception. Xoom is excelling tremendously and duly drawing attention and praise. In June of 2010, Xoom was declared to have the highest consumer satisfaction ratings in transparency of the fee, transparency of the exchange, and value. In March of 2011, the Wall Street Journal named Xoom one of 50 companies in the publications “Next Big Thing List”. Xoom has entered an exploding market, and with its ease of utility, excellent customer service, and top-tier service, it is setting a standard that will prove harder and harder to beat. Apart from the caliber of its services, Xoom has attained high notoriety by utilizing online advertising and marketing tools, suggesting that the industry’s future is not only digital, but also social.
The digital realm holds the future of the money-transfer industry. Stick your foot in the door now before it shuts you out. To both companies and consumers, I would love to hear any and all of your thoughts, concerns, and ideas regarding the money-transfer industry’s shift towards the digital. Share your comments below!
Click image to view full size pdf >>
Infographic Design: Meghan Dougherty