60 years of payment evolution

Last month, as a British nation we gathered along the banks of the Thames, at Buckingham Palace or even in our own streets to celebrate the 60 year reign of Her Majesty The Queen. Revelling in Union Jack bunting, the Pageant and Gary Barlow, the furthest thought from our minds was probably how we were spending our money at our respective events. Chip and PINs. ‘Wave-and-Pay’ debit cards. Contactless, smart phone payments. As we paid tribute to the Queen, we also subconsciously saluted the latest developments in payment technology.  However it is the image of Queen Elizabeth herself on traditional bank notes that reminds us of how much payment mechanisms have evolved since her accession to the throne.

Since the Queen became the first monarch to feature on British banknotes in 1960, payments worldwide have changed beyond recognition. Banknotes featuring the wording “I promise to pay the bearer the sum of the note on demand” are still in circulation of course. However, whereas one once sent cash or a cheque in the post for someone’s birthday, a parent will now send money to a child at university using online banking or even a smart phone app, such as Barclays Pingit.

Visa, in collaboration with Samsung, both official London 2012 partners, have pioneered PoS contactless mobile payments, with the launch of payWave. To buy a round of beers at an Olympic venue, users simply hold their phone in front of a contactless reader at the point of purchase. As an added layer of security, transactions over £15 require a passcode.

Merely checking your balance or recent transactions used to involve a trip to the bank to print off a receipt. Now it’s attainable at the touch of a button.

1966 is synonymous with a unique sporting success in this country. However it also marked a first of a different kind – the credit card. By 2008, 30.8 million people in the UK were credit card holders and used them to make 1.9 billion purchases that year. It is amazing to think that the first debit card was introduced as recently as 1987, the year in which construction of the Channel Tunnel began.

In today’s Britain, that payments are contactless, instant and effortless is a given. That’s nothing new or innovative any more. So where are the new trends and evolutions coming from?

In the same way that banks have made payment mechanisms touch-free, the next evolution involves transforming methods from the physical to the virtual domain. Virtual card technology enables closed-loop payments, which in turn offer greater security and control for corporates.

At Conferma, we implement single use virtual cards into procurement processes. Single use payment systems are, by their very nature, scalable and customisable, allowing multiple cards to be used and multiple transactions to be processed. Conferma’s unique accounts ensure that, no matter how great the volume of transactions, the process of reconciling transactions with the procurement order is accurate and efficient.

With the advent of smart phones, tablets and now virtual card technology, as payment technology and innovation accelerates we will only have to wait 60 months for cardless payments, rather than another 60 years.