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September 17, 2014


Renee weisman

Can you comment on the "safety from hackers" of the digital payments?

irving Wladawsky-Berger

Renee, safety from hackers, as well as identity management, privacy and security in general are major areas where the mobile payments infrastructure must significantly improve to achieve wide acceptance. There is a lot of work in this space, including Secure Cloud and Network Tokenization that were part of Apple's announcement.

Bitcoin, Ripple, and other cryptocurrencies are introducing a number of innovative technologies which will hopefully influence the future directions of the overall payments infrastructure.

In addition, there is significant research going on in universities that will help in the future.

So, while I'm hopeful that the security of the payments infrastructure will keep improving in, the problems are very complex, so it will all take time.

Bud Byrd

I am having difficulty rationalizing a $400 watch, a $600 i-phone, the poor earning $2 a day and their use of digital payments to pull themselves out of poverty. What am I missing?

Jeff Rhoda

Irving, stopping by your blog is always thought provoking. I agree that mobile payments may be a solution looking for a problem in the USA market, but I often think the problem is brushed over a bit. In many countries, using a credit card without a password is unheard of. The security is amazingly poor but no player wants to take on the cost of change (ie banks, credit card service providers, retail outlets, etc).

Something as simple as a text/SMS to your phone when your card is used would at least limit the value of theft. Very common practice in places like Singapore and China.

The other area is that mobile payments opens up competition for the banks. Though Apple Pay plans to include the traditional players, there is no reason why regulators can't open simple consumer banking to the likes of Telcos and others especially in the developing world. If those mobile apps are so easy to use and consumer friendly, they could easily be rolled out elsewhere. Literally, for simple savings and checking, do you need a bank? Tao Bao is paying in the neighborhood of 5% interest on money deposited in their paypal-like service. They also offer money market funds.....and, yes, owned by Alibaba.

Interesting times.

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