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Digital payments are revolutionizing the way people use and spend money. China has leapfrogged other markets when it comes to cashless payments, primarily through mobile phone payment systems like Alipay and WeChat Pay. The success of the cashless nation has received attention from other countries, including Singapore who is replicating digital payments best practices from China as part of its Smart Nation initiative, a drive for the digital transformation of government.
The e-payment race
A month ago, Singapore announced the launch of a single standardized SGQR code that will replace the plethora of QR (quick response) e-payment codes currently in the market, demonstrating its move towards a cashless society. Combining multiple e-payment solutions into one, the SGQR code will put consumers and businesses on a unified payment system. Benefits include faster moving queues, quicker processing of payments and new opportunities for non-banking players and fintech organizations, according to Channel News Asia.
The race is on for India too. The demonetization of 500 and 1000-rupee currency notes is forcing citizens to access a formal banking system, accelerating India’s digital economy. A new transaction system through Unified Payments Interface (UPI) facilitates instant fund transfer between two bank accounts on a mobile platform. The beneficiary’s bank account details are not required, making this a giant leap into e-payment. Digital transactions could reach USD 1 trillion annually in the country, with four out of every five transactions being made digitally by 2025.
However, while digital payment brings convenience, organizations must continue to address challenges around data privacy and security (cybercrimes).
Big Data is changing e-payment
Big data refers to a process that is used when conventional data extracting, and handling techniques cannot uncover the insights and meaning of the underlying data.
While a unified e-payment system aims to make payment easy, convenient and accessible for consumers and businesses, a consolidated payment landscape would mean that more data is needed for aggregation and analysis, in the case of Singapore and India. Data mining and data analytics help business to transform large volume of data into insight for smarter decisions. The financial sector is turning to predictive and deep learning to combat fraud and risk.
As organizations turn to digital payments to offer a better customer experience, they must ensure they have a reliable and fast network coupled with the right data infrastructure. Financial institutions and their partners must take a holistic view of their network infrastructure and ensure the potential of data is unlocked for better decision-making in this digital age.