By Qishin Tariq
Digital acceptance is the next major move for retail banking, according to digital company MyFT.com.au.
Digital acceptance refers to the effort to process debit or credit card payments via the internet or a mobile phone as well as through other types of innovative technologies.
Most major banks in Australia already offer their customers digital services that allow consumers to make payments using apps or via online banking, which means they are already using the digital technologies.
But MyFT.com.au says there is a significant opportunity for the banks to add more features to their websites and apps. It estimates that there are 100 million consumers in Australia with bank accounts and that there are 20 million active users of various digital services on a monthly basis.
These figures reveal there is a significant opportunity for traditional banks to gain new customers and use the existing bank branch network to drive new business and digital acceptance is one of the ways they can do that.
“The major problem is that we don’t have banks or bank customers that have identified online and mobile payments as a necessity.
“They still think cash is a safe medium for transacting, but I believe these long-term trends will change this perception,” said Wilshon Olsson, the co-founder and CEO of MyFT.com.au, a technology company focused on consumer banking.
“Instead of using credit cards or debit cards in bank transactions, customers should be using non-cash methods such as smartphone and internet banking, instant one-click transactions, peer-to-peer payments, online and mobile payments,” he said.
Despite these obvious benefits, and despite many Australian banks taking steps to extend the use of mobile and internet banking to pay on their websites, Mr Olsson believes it would be significant if all the major banks in Australia were to implement digital acceptance.
It would enable users to pay for goods and services via the internet, rather than taking them into a bank branch or using their debit or credit cards.
“This will happen by enabling banks to offer more digital banking, such as on mobile and internet banking, with a larger range of functions, while also opening up mobile banking to the customer themselves through one-click card payments,” he said.
“That would give customers the flexibility of making card payments online, without them having to take a 30-minute drive to a bank branch or wait to make a 25 per cent interest card deposit at their local ATM.”
The technology is already in the banking system to enable this to happen with simple security and authorisation practices.
The new digital banking capabilities would mean the customer could make automated card payments on the internet or in person and it would simplify existing services by connecting them, he said.
Mr Olsson said this change would give customers the opportunity to do more online and complete more customer transactions without going into a branch or taking an ATM card out.
“This will give an opportunity for banks to expand their branch network by opening more ATMs and switching over customers to digital,” he said.
The company has recently launched MyBankConnect, which allows banks to launch a digital account.
“This is the most exciting initiative because it allows customers to sign up and download the digital account via any digital device and enjoy the same sort of banking features as their bank of choice,” he said.
In 2012 MyFT.com.au was one of the first Australian banks to publicly announce its intention to implement digital acceptance with its banking MyFT Account.
In 2014, it rolled out a phase of its digital services and recently has joined many other Australian banks in providing one-click card payments to customers.
MyFT.com.au recently extended the scope of its digital activities and has launched a pilot of its digital payment service dubbed MyFTPay at 10 financial institutions in Australia and in New Zealand.