Author: David Webber
Digital devices and mobile payment security
The Financial Conduct Authority (FCA) this week announced it is undertaking a review into mobile payment security. This comes as Britain’s booming mobile banking sector is developing at such a speed that it wants to ensure Britain’s biggest high street banks are innovating security measures in-line with developments. And with daily news stories about a plethora of wearable technology devices hitting the market, it may not be long until the FCA has to extend this review even further, to cover digital banking on wearable technology.
The mobile nature and convenience of smartphones and tablets has seen a sharp rise in their use for digital banking. Research published earlier this year by market researcher TNS showed that one in five adults in the UK has already made a payment using their mobile phone.
As use of smartphones and tablets for digital banking becomes commonplace, the technology sector leaps ahead with new developments. Constant rumours circulate about the newest wearable technology that may come to fruition. New articles are written every day about Google Glass, Apple made headlines by trademarking the iWatch earlier this year, and fierce rival Samsung set tongues wagging this week by confirming the date of its Galaxy Gear Smartwatch launch.
With smartwear becoming ever popular with consumers thanks to fitness trackers like Fitbit Flex and Nike Fuelband, the integration of web access into mainstream products (such as a pair of glasses or a watch) is likely to see an increasing interest from the masses, rather than just fitness fanatics, for wearable technology.
Whether consumers will instantly use wearable technology for money management is yet to be seen. However, it’s telling that our recent research found that one quarter of 18-24 year olds (25%) have already said that they would manage their finances using wearable technology. With the Pebble Watch already available to buy, it therefore may not be long until we see consumers managing their bank accounts or making payments from their smartwatches.
Each rumour, irrelevant of brand, signals a move closer to independently functioning wearable technology. This means financial service providers will need to be ahead of the curve in creating digital banking technology that works securely on the platform.
The FCA is due to publish a full report into mobile banking in early 2014. By this time, there may already be a range of wearable technology available on the market, posing a host of further queries for the regulator. The question for financial service technology providers is to which of the whispered wearable tech rumours should we listen to help us plan for what’s in store?