Chapter 16 : Using Beacons

The future of payments is current shifting to another path with how technology is changing and is currently modifying how we process our payments and how we store data. It is going away from low-tech and paper based tools, expensive and bulky registers, and physical card swipes. And it is introducing and renovating online commerce and online payment. This is happening due to the decrease of money supply and checks in the current market because people are starting to pay more and more there bills online. As the economy improces and corporations and business gets larger they have started a large-scale implementation of processors in electronic payment technology in their business ands services. Also, credit and debit are growing amongst consumers and it has been the highest that it has even been in history.

Although major retailers have had credit card breaches, which devastated consumer trust in credit, Mobile payment systems stay efficient, but risk personal and financial data fraud similar to plastic credit card usage theft. Patrons fear merchants can track your shopping habits, location and financial records using a mobile GPS signal. Nevertheless, worries that someone can steal their information when sent wirelessly therefore consumer confidence remains low. Thorough safety measures will help give customers composure and regain assurance. (Busby, 2014) (Sapienza, 2013)

According to the most recent Federal Reserve study; most of us haven’t set foot in a banking hall in ages. It is a lost battle to banks that opt to use traditional methods to conduct their banking transactions (Gup 2003). By December of last year, close to half of all smartphone users in the United States had transacted some or all of their banking on their phones and iPhones. In the United Kingdom alone, rates of mobile banking transactions doubled over the course of a single year (Scn Education 2001). A banking business that invests in this type of technology gets assured of increasing their customer base.

In 2016, e-Marketer estimates that 37.5 million people in the U.S. (19% are smartphone users) will transact using their phones, by the end of 2016, mobile payments are expected to exceed $27 billion. Predictions are that by 2017, U.S. mobile commerce will have increased so much in popularity that it will account for 50% of U.S. total digital commerce revenue (Mobile ecommerce, 2016).

In fact, we can trace the true origins of the most recent surge of technological developments as far back as thirty five years ago when the Atari 2600 was released and the impact that it had on game programming. In the early 1990’s we saw pagers take off and the birth of computer games as well with the success of computers. However, it wasn’t until the mid to late 1990’s when the Internet took off that the changes in technology were happening more in succession. For example, the flip phone was only about a decade ago and in the past eight years, the iPhone changed everything as technology started merging to include Internet, GPS, camera and video capabilities on the smartphones. Network of computers and the Internet that connects them to each other from the basic technological structure that underlies virtually all-electronic commerce (Schneider, 2015, p. 61). Technology has changed the way the world does business and the way we now communicate and interact with each other. Technology’s growth has translated into a shift from traditional business and the way it is conducted. The role of technology has allowed a leading bank such as JPMorgan Chase to implement innovative use of new technology to increase revenue. For example, JPMorgan Chase reported that 41 percent of its customers that used mobile banking in 2013 alone to make their deposits. JPMorgan Chase views technology as an opportunity to improve their relationship

Therefore, it is essential to address issues like security of the banking transactions that are executed from a distant place and transmitted over the air. Besides this, it is also important to ensure the security of financial transactions, if the device is stolen by hackers. If these concerns are properly addressed, then it would help increase the popularity of mobile banking by instilling a sense of trust among the customers.

In today’s economy, cash or a credit card is needed to meet the basic human needs. It is an apparent fact that we need cash or credit cards to purchase items such as food, clothing, and to buy gas. Also, when you are out shopping and discover that you have used all the cash in your possession, it is then that you realize that the advantage of having a credit card. Furthermore, with cash, you are restricted to the amount in your wallet or purse; however, a credit card allows you to pay for your purchase at a later date. Both cash and credit cards can be useful when you manage them wisely. While cash and credit cards are similar in that they both are readily accessible, used for goods and services at the time of purchase, they are dissimilar because of theft, high- interest rates, identity theft.

In many developing countries it's common for a person to have a mobile phone but not a bank account. In fact, more than 1 billion people fit this description, and the number is only likely to increase. To that end, many companies are considering how to give residents access to banking services via their handsets. The GSM Association predicts that by 2012, nearly 300 million of the previously "unbanked" will be using some form of mobile banking.

The move to use electronic cash in an ironically termed society dubbed “cashless”; there are many issues that include

Half of the people in the world don't have access to a bank account and have had to develop parallel payment systems to conduct transactions.a dark side to

To answer my main question “Will mobile payments replace credit cards?”, I have conducted an online survey as part of the primary research. I received 92 responses from the survey. A 2009 study by Deloitte predicts that by the end of 2015, seventy percent of mobile payment users will be under the age of 40 and that the annual spend of these Millennials (also referred to as Generation Y) will reach $2.45 trillion dollars in the US alone.(Dennehy D, Sammon D, 2015). So, I have focused mainly on the age groups 18-29 which were 69% and 30-44 which were 21% of the total responses (Exhibit 1). 88% of the people were aware of the mobile payments (Exhibit 2) and 33% were extremely comfortable with the concept of mobile payments (Exhibit 3). The research clearly tells that people are aware of the technology and are comfortable using it. Respondents of the survey were concerned by the security threats that mobile payments impose, but then companies while putting this idea into implementation have to primarily take care of the security aspect of the mobile payments concept (Exhibit 4). As per the usage of mobile payments, respondents have primarily (52%) used mobile payments for online bill payments (Exhibit 5) while the retail usage is 30% which clearly suggests mobile payments still have a long way to go in future.

America is shifting to a completely digital economy. The modern and innovative market relies on improvements to be made to stay fresh and new. This shift makes sense as so much of our lives have become digital. Our homes’ appliances can be turned on and off on our phones, our credit cards can be scanned from our phones, typing is a corner stone application in public schools. However, the push to digitize your wallet is a step that may be too risky to undertake in American society. Issues that come from the loss of physical cash must be placed on the scale prior to the transition over. The psychological, social-economic, and the logistical nature of the market and its participants seem to be overlooked for the quest to modernize and presumable efficiently. While some may argue that gradual phasing out of physical currency can promote ease of use and solve economic situations found in the American economy, it is wrong to believe that the logical step is to change the nature of our currency.

Almost everyone has a smartphone, so engineers invented a way to let merchant charge customers through a device that can be attached to any mobile phone. This device, or credit card terminal, is the future of credit card terminal technology, where merchants can charge customers anywhere and anytime [3]. This report will present the market analysis, theory of operation, and the device performance of Square.INC credit card reader [3].

The creation of money is possibly one of the greatest accomplishments of human civilization. Since the beginning of humanity, individuals have used money as a way to pay for goods and services. Over the years, money has been used in various forms and continuously changes to best fit modern society. Our society no longer has to depend on gold coins, cocoa beans, or anything else of intrinsic value that has been used in the past. In today’s society, we use paper currency, which is fairly convenient and easy to carry around with us. Over the past decade, our economy has experienced tremendous changes due to the introduction of new cutting edge technologies. Millennials are accustomed to a digital world and most likely will experience the transition from paper money to digital money. The advancements in technology over the past several years has allowed consumers the opportunity to buy and sell goods over a computer network known as the Internet. The internet is a much more convenient way of shopping compared to fighting crowds of people at your local mall during the holidays. We must start to prepare ourselves for the digital age of currency, an age in which a small amount of our money will actually be tangible. Many individuals are concerned about the privacy and security issues that may arise from the transition to digital currency. However, the more research you do on digital payments, the more you will realize that it is very safe and efficient when compared to paper money.

As per Ministry of Finance Report (December 2016) on Digital payment, financial inclusion is one of the foremost challenge facing India . 53 percent of India population had access to formal financial services . In this context , digital payment can act as accelerator to financial inclusion (KPMG 2017) . Increasing availability of mobile phone , availability of data network infrastructure , rollout of 3G & 4G network and large merchant eco system are the critical enablers of digital payment in India . It is further supported by the coordinated efforts of industry , regulator and government. As per RBI’s report ‘Vision 2018’ four pronged strategy focusing on regulation, robust infrastructure , effective supervisory mechanism and