Are Card Payments becoming Simpler or Complex?

We are almost half-way through the year 2018 and today, card payments are the norm. Most of us prefer carrying a credit card and making all payments with it instead of carrying a lot of cash. However, the debate here is whether card payments have actually become simpler or are we using a complicated mode of transaction without realizing it?

Here’s a look at how card payments have evolved through the years?

A few decades ago, we barely heard about card payments. Cash was still the primary mode of payment and many consumers were actually scared to switch to cards. Slowly, we saw businesses and consumers open their doors to the world of card payments and today, we see a major shift. Cards are the way to go, both for businesses and consumers. The number of card holders and the number of card payments in retail stores have grown exponentially, proving this exact point.

Are credit cards the only mode of card payment? No. We now live in a world of PIN and Chip that have replaced card swipe payment. One might argue that the new technological advancement has complicated processes but if you think about it closely, you will understand that PIN and Chip are much safer in that you cannot have counterfeit cards and makes it very difficult for some unscrupulous element hacking into someone’s account.

Was the shift from cash to cards easy?

Cash payments were a habit and to get out of any habit is difficult. That was the conundrum that many people faced. People liked holding money in their hands instead of plastic cards. They felt it was safer to have all the money and see how much they were spending. Plus, technology was a scary thing back then and many users had trust issues.

If cash was stolen, they at least knew that what was in their bank was safe. What if their card was stolen? Their bank accounts would be compromised, and they would face bankruptcy. Also, with card payments it is easier to sub-consciously spend more.

However, people were made aware of the benefits of making the shift. For example, keeping track of expenses and budgeting are simpler. Your statement at the end of the month tells you about every expense. Another point is that if you, unfortunately, misplace your card, you can call your bank and freeze it immediately. You will not lose even a penny of your hard-earned money.With consumers having finally realized that the pros outweigh the cons, we saw the mega-shift of usage in the recent years. It definitely wasn’t easy but now, the tables have turned and many prefer cards over cash.

What are the security concerns revolving around card payments?

As aforementioned, security was a prime reason for people to resist card usage. What were these threats? Account getting hacked was definitely number one. Besides that, fraud and data security are major concerns. How often have we heard that people were cheated into revealing their card information? Too many times. We have also heard cases of security breach, hacking, etc. during online payments using card information.

Talking about online payments, we must not forget the complexity that passwords come with. Passwords must be unique, difficult to hack, and so on. With increasing complexity comes better security feature; one might argue is it worth the hassle? Yes definitely, it is for your hard-earned money.

What does the future look like for card payments?

Today, we have chip cards with fingerprint security, virtual single use cards, and contactless cards. These cards are the future of card payments. They put to rest all the risks surrounding security and ensure that payments are smooth.

In conclusion, we think it would be safe to say that even though card payments have become complex from the technology standpoint, they are simplifying transactions, which is a big step towards user satisfaction and security.

Prasanna Chitale

Prasanna is Head of Innovation at Verinite and member of Leadership Team. He has worked across various locations including Europe, Middle east and India on projects providing services in retail and corporate banking domain. Outside his work, he is a photographer, a traveler, and a mathematics enthusiast.