Michael Weatherseed, director of the Security Business Unit at COMEXPOSIUM Group.
Mobile payments are gradually overtaking the traditional methods of payment such as cash and cards. Crypto-currencies, especially Bitcoins, also made the headlines last year as a plausible mode of payment in future. Michael Weatherseed, director of the Security Business Unit at COMEXPOSIUM Group, shares his thoughts on these emerging payment methods including their advantages over traditional methods and the drivers driving their adoption.
What are some of the popular mobile payment methods in Asia today? Are these methods being widely used in other parts of the world too?
There are various types of mobile payment available today. We are seeing the emergence of multi-service wallets, mobile payment terminals, dematerialization, smart labels and self check-out and biometrics applied to payment methods. Culture and history play a role in determining methods that dominate. For example, the NFC (near field communication) Octopus card is widely used in Hong Kong. Asia is leading the way in this sector, and I think all the technologies are likely to co-exist in future.
What advantages do mobile payment and crypto-currencies have over traditional methods of payment and real currency?
Crypto-currencies are easy to use as they work just like cash but over the Internet. They also offer anonymity as they do not require the user to reveal his or her name or to even have any bank accounts to use them. They are currently tax free too.
As for mobile payments, they enable the user to quickly and easily pay for their purchases. Besides that, they offer value added services like loyalty schemes to the user.
In your opinion, what are the drivers for the uptake of mobile payments?
Consumers are driven to use mobile payments as they provide convenience without compromising security. Additionally, consumers want to be able to interact with different shopping channels such as brick-and-mortar and e-commerce.
On the side of merchants, mobile payments will enable them to be more competitive, as well as help them to improve their business efficiency and cost control.
Mobile devices are known to be vulnerable to malware and other security threats. How should mobile payments be secured then?
Security solutions will be (and need to be) continually updated — as with other information and transaction systems. Mobile payments could also be secured with authentication solutions, and trust execution environments.
Many countries are still grappling with the issues of crypto-currencies. China, for instance, has banned its banks from trading in the virtual currency as it was concerned about Bitcoin not being controlled and issued by a central monetary authority. So what does the future hold for crypto-currencies?
The future of crypto-currencies is unclear as they are volatile, anonymous, and bypass state controls and taxation. Different governments have different attitudes towards them. While China and Thailand have banned it, the USA and Germany are "recognising" it. The Central European Bank, however, refuses to give it a legal status.
However, all of this could change rapidly. I foresee three different possibilities to the future of crypto-currencies: self-regulation by the exchanges and the users; a legal framework (but it is unclear as to how many governments will actually agree to this); or a decision to ban it entirely.