As we enter the next decade, local and African merchants should support payment methods that suit their customers, rather than following global trends just for the sake of it. Peter Harvey, MD of payment service provider, DPO SA, looks at five trends we can expect over the next few years.
- Cash is here to stay – for now
Despite common perceptions, South Africa still has more than 11 million unbanked individuals and cash remains the preferred payment method for these and many other customers.
Harvey says: “As we enter 2020, we can expect a host of new digital payment technologies that sound like excellent options – and they may well be for some – but merchants need to carefully monitor their customer behaviour before they rush to try the latest gadget or fad.”
According to Harvey the banks and card companies like Visa and Mastercard will be placing a large focus on enticing consumers to move from cash to card-based payments in the coming years.
“Overcoming the reliance on cash will take a fair amount of time and effort,” says Harvey. “For merchants trading in a cash-based community, depositing money into a bank that tracks your spending, charges you to store your money, and then charges you again to withdraw it can seem unattractive. At the end of the day consumers will make their decision based on convenience, cost and risk.”
Card payments are expected to morph over the coming years. In South Africa the tap and pay method is becoming more commonplace. Harvey believes this and other near field communication (NFC) methods of card payments will continue to grow in use as shoppers become more trusting of the technology and retailers see the efficiency benefits of moving customers through their purchase cycle more quickly and easily.
- Mobile is still king
There is no doubt that the means to facilitate most digital payments in Africa will depend on mobile technology.
According to South African communications regulator, ICASA, South Africa has a smartphone penetration of 80%. In Sub-Saharan Africa meanwhile, the mobile phone penetration is 50% and the GSMA expects smartphone penetration to grow from around 40% to 66% in 2025.
Harvey says smartphone technology and wearable technology will allow for the growth in some of the newer payment tech, like Apple Pay and Samsung Pay, but these payment methods will remain in the hands of the top LSMs and have little effect on the bottom of the pyramid customer base.
“For the moment USSD technology will still underpin the majority of mobile payment methods. Until smartphones increase in penetration, payments like m-Pesa will continue to dominate. Customers know and trust the solution and its these types of offerings that will need to be beaten by any new entrant over the next two to three years at least.”
- New decade, new banks
Harvey is upbeat about the new digital-only bank offerings like Tyme Bank, Bank Zero and Discovery Bank.
“It appears that 20Twenty was two decades too soon,” says Harvey. “The local markets are now finally ready for a new digital offering without the fuss and cost of the traditional offering. These banks stand a good chance of making an impact and making headway towards financial inclusion in the country.”
Harvey believes, that in order to boost the number of people using digital payments, the banking institutions, merchants and payment service providers need to start incentivising consumers to make the switch. Loyalty and Rewards will start playing an even bigger role in the near future.
- New services for the payment ecosystem
Based on demand, Harvey believes forward thinking payment service providers will work closely with their banking partners to focus on providing their mutual merchants with a ‘fully managed service’. This service includes: instant sign-up; a full suite of payment products; risk screening; account reconciliation; anti money laundering checks; access to shopping cart plugins; and a variety of other value-added services in the online digital payment space.
These services will enable digital retailers to quickly and easily start selling their services online, while protecting them from the associated risks.
The service benefits the banks as well as the broader digital ecosystem, as the payment service provider actively monitors and manages merchants and transactions, removing risk from the process and facilitating ‘good’ transactions.
- Identity technology takes centre stage
Looking at newer technologies, Harvey believes biometrics will continue to be the key focus.
Harvey says voice and facial recognition are set to take off in South Africa in 2020 and 2021 and he believes the key driver in this regard is the increasing use by the government.
“Banks and Home Affairs teaming up for the renewal of ID documents and passports is a major win for the average citizen,” Harvey says. “This falls neatly into the ‘convenience’ motivator and as people use and trust the biometrics used by the banks for this service, they will become less afraid to try it for payments.”
As technology rapidly improves, the payments ecosystem can expect some exciting advancements over the coming decade. Chat commerce and even augmented and virtual reality developments will almost all come with payment features. However, Harvey cautions against over exuberance.
Harvey says “Make sure you cater for what your customer actually wants, not what you think they should want. If working closely with African merchants, banks and customers has shown us anything, it’s that the fastest way to drive away business, is to dictate how customers pay. Provide the options and let them choose.”
IoT sensors are anything from doctor to canary in mines
Industrial IoT is changing the shape of the mining industry and the intelligence of the devices that drive it
The Internet of Things (IoT) has become many things in the mining industry. A canary that uses sensors to monitor underground air quality, a medic that monitors healthcare, a security guard that’s constantly on guard, and underground mobile vehicle control. It has evolved from the simple connectivity of essential sensors to devices into an ecosystem of indispensable tools and solutions that redefine how mining manages people, productivity and compliance. According to Karien Bornheim, CEO of Footprint Africa Business Solutions (FABS), IoT offers an integrated business solution that can deliver long-term, strategic benefits to the mining industry.
“To fully harness the business potential of IoT, the mining sector has to understand precisely how it can add value,” she adds. “IoT needs to be implemented across the entire value chain in order to deliver fully optimised, relevant and turnkey operational solutions. It doesn’t matter how large the project is, or how complex, what matters is that it is done in line with business strategy and with a clear focus.”
Over the past few years, mining organisations have deployed emerging technologies to help bolster flagging profits, manage increasingly weighty compliance requirements, and reduce overheads. These technologies are finding a foothold in an industry that faces far more complexities around employee wellbeing and safety than many others, and that juggles numerous moving parts to achieve output and performance on a par with competitive standards. Already, these technologies have allowed mines to fundamentally change worker safety protocols and improve working conditions. They have also provided mining companies with the ability to embed solutions into legacy platforms, allowing for sensors and IoT to pull them into a connected net that delivers results.
“The key to achieving results with any IoT or technology project is to partner with service providers, not just shove solutions into identified gaps,” says Bornheim. “You need to start in the conceptual stage and move through the pre-feasibility and bankable feasibility stages before you start the implementation. Work with trained and qualified chemical, metallurgical, mechanical, electrical, instrumentation and structural engineers that form a team led by a qualified engineering lead with experience in project management. This is the only way to ensure that every aspect of the project is aligned with the industry and its highly demanding specifications.”
Mining not only has complexities in compliance and health and safety, but the market has become saturated, difficult and mercurial. For organisations to thrive, they must find new revenue streams and innovate the ways in which they do business. This is where the data delivered by IoT sensors and devices can really transform the bottom line. If translated, analysed and used correctly, the data can provide insights that allow for the executive to make informed decisions about sites, investment and potential.
“The cross-pollination of different data sets from across different sites can help shift dynamics in plant operation and maintenance, in the execution of specific tasks, and so much more,” says Bornheim. “In addition, with sensors and connected devices and systems, mining operations can be managed intelligently to ensure the best results from equipment and people.”
The connection of the physical world to the digital is not new. Many of the applications currently being used or presented to the mining industry are not new either. What’s new is how these solutions are being implemented and the ways in which they are defined. It’s more than sticking on sensors. It’s using these sensors to streamline business across buildings, roads, vehicles, equipment, and sites. These sensors and the ways in which they are used or where they are installed can be customised to suit specific business requirements.
“With qualified electronic engineers and software experts, you can design a vast array of solutions to meet the real needs of your business,” says Bornheim. “Our engineers can programme, create, migrate and integrate embedded IoT solutions for microcontrollers, sensors, and processors. They can also develop intuitive dashboards and human-machine interfaces for IoT and machine-to-machine (M2M) devices to manage the input and output of a wide range of functionalities.”
The benefits of IoT lie in its ubiquity. It can be used in tandem with artificial intelligence or machine learning systems to enhance analytics, improve the automation of basic processes and monitor systems and equipment for faults. It can be used alongside M2M applications to enhance the results and the outcomes of the systems and their roles. And it can be used to improve collaboration and communication between man, machine and mine.
“You can use IoT platforms to visualise mission-critical data for device monitoring, remote control, alerts, security management, health and safety and healthcare,” concludes Bornheim. “The sky is genuinely the limit, especially now that the cost of sensors has come down and the intelligence of solutions and applications has gone up. From real-time insights to hands-on security and safety alerts to data that changes business direction and focus, IoT brings a myriad of benefits to the table.”
Oracle leads in clash of
Three e-commerce platforms have been awarded “gold medals” for leading the way in customer experience. SoftwareReviews, a division of Info-Tech Research Group, named Oracle Commerce Cloud the leader in its 2020 eCommerce Data Quadrant Awards, followed by Shopify Plus and IBM Digital Commerce. The awards are based on user reviews.
The three vendors received the following citations:
- Oracle Commerce Cloud ranked highest among software users, earning the number-one spot in many of the product feature section areas, shining brightest in reporting and analytics, predictive recommendations, order management, and integrated search.
- Shopify Plus performed consistently well according to users, taking the number-one spot for catalogue management, shopping cart management and ease of customisation.
- IBM Digital Commerce did exceptionally well in business value created, quality of features, and vendor support.
The SoftwareReviews Data Quadrant differentiates itself with insightful survey questions, backed by 22 years of research in IT. The study involves gathering intelligence on user satisfaction with both product features and experience with the vendor. When distilled, the customer’s experience is shaped by both the software interface and relationship with the vendor. Evaluating enterprise software along these two dimensions provides a comprehensive understanding of the product in its entirety and helps identify vendors that can deliver on both for the complete software experience.
“Our recent Data Quadrant in e-commerce solutions provides a compelling snapshot of the most popular enterprise-ready players, and can help you make an informed, data-driven selection of an e-commerce platform that will exceed your expectations,” says Ben Dickie, research director at Info-Tech Research Group.
“Having a dedicated e-commerce platform is where the rubber hits the road in transacting with your customers through digital channels. These platforms provide an indispensable array of features, from product catalog and cart management to payment processing to detailed transaction analytics.”