In the blink of an eye, technology has infiltrated the lives of consumers and businesses everywhere. And the evolution of computing technologies continues to impact economic growth and development, moving the world forward. The significant decrease in the cost of computing over the past decade has also made connectivity ubiquitous, allowing everyone to be connected all the time.
Today’s digital-transformation trend continues to create organizational changes for operational effectiveness worldwide. Simultaneously, innovations are uncovering fundamental ways to converge vertical industries and software technology in new ways that ultimately streamline consumer experiences and business efficiencies.
In 2015, digital transformation surfaced as the overriding tech focus to change the future of business operations around the globe. Industry analyst reports from IDC, Gartner, and more, all accurately predicted that the majority of companies would transform their businesses by 2020. It is easy to look around and see their forecasts coming to fruition.
The speed of this revolution—known as digital disruption— is taking things to new levels as emerging technologies transform the way verticals conduct business. In turn, the lines between different industries are quickly blurring.
Case in point: Software technology and payment- processing companies are colliding to create new, frictionless products and services for consumers and businesses of all sizes.
Remember how, only 30 years ago, a retail or restaurant charge took time to run through a machine? Yet today it is relatively common to swipe a card or mobile device for a transaction at lightning speed.
As retail frontrunners, Uber, Amazon, Starbucks, and Apple have all created opportunities for payments without much effort from the consumer. With Uber or Lyft, one can instantly hail and pay for a ride with the click of a button. Amazon Go—Amazon’s pilot grocery store without checkout lines—lets shoppers purchase items in a store and pay via their smartphones.
Removing checkout friction from any process—shopping, enrollment, or service—is creating a better consumer experience and more selling potential.
Realizing that most companies use software to run their business, here are two key questions and opportunities to consider:
- Should software companies become payment processors?
- How can these separate industries best work together to streamline consumer and business interactions?
Since the hub of all interactions is software, it is incumbent on payment processors to make it easy for software to plug in payments without adding extra steps. The ability to have an invisible feature inside software can create a more efficient business encounter.
Consider your last Uber ride or Amazon purchase. Once you set up your account, you never had to think about payment again. The ease of use ensures you use the service over and over again. This same approach can be used within every type of software.
Open APIs (application programming interfaces) can integrate payments inside inventory software, or streamline enrollment so software data can make payments with no effort on the part of the end user.
Efficient business practices occur when payments and all the related activities—such as security, tokenization, encryption of cards, invoicing, posting back into ledgers—are integrated. In turn, business owners can focus on other priorities instead of carving out time to manage bills and payments.
Payment-processing companies that work hard to create amazing experiences within software will do well. It’s critical that both sides of this equation advance by working together. Payment providers offer a critical back-end technology platform in this effort, while, ultimately, software companies are in charge of streamlining business processes and consumer experiences.
As with any industry change, there are sectors that fall behind the curve. While great strides are being made to merge software technology with payment processing across the obvious channels such as retail and restaurant, other evolving verticals, such as healthcare and even wholesale business-to-business transactions, continue to be fraught with friction due to antiquated practices and stringent regulations.
It is clear that those verticals that push forward to scale and grow will successfully integrate processes by developing new platforms to meet customer needs.
View the Digital Transactions article here.