Shaken up by the pandemic, consumer habits have probably changed faster in two years than in the whole of the past decade. However, this accelerated conversion to digital payments, such as the increased use of contactless bank cards and mobile equivalents, is only the tip of the iceberg. Ultimately, the constant changes in commerce are now the main driver of innovation in payments making cash payments less prevalent in our daily lives.
Evolution not revolution
These sociological changes, accentuated by the creativity of brands and consumer expectations, are part of the latest advances in AI but while they are certainly a far-reaching innovation, I would hesitate to speak of a revolution, at least for the electronic payment sector.
Our industry has long used AI, albeit in more traditional forms, in many of our products and business processes. But a technological advance does not always need to be a revolution to be both intellectually stimulating and promising for the value that can be drawn from it if we slightly adapt the uses for which it may be suitable.
And the payment industry is, I believe, a very good candidate for generative AI. Innovation in our businesses is very demanding, as it must combine various objectives which may seem contradictory at first glance: extreme ease of use but also a very high level of security; highly optimised cost but optimal integration into individualised purchasing paths; and the capacity to manage extreme load peaks but zero tolerance for fraud. Next-generation AI will certainly enable significant advances in our ability to overcome these apparent paradoxes, and a few examples from ongoing projects or pilots tested within Worldline illustrate its potential.
Rise of AI to improve the customer experience, increase sales for merchants, enhance security
For banks and their clients for instance, AI makes it possible to constantly enhance the security of existing payment solutions, improving fraud detection by identifying sometimes minimal anomalies within millions of seemingly innocuous transactions, while still simplifying, from the user’s point of view, the friction linked to authentication or control procedures. This is one of the areas of AI that we have been exploiting for a long time, with offers that have been widely tested and appreciated by our customers, where the latest advances will find perfect ground for deployment.
AI is also an important lever for improving the customer experience in a purchasing situation, and therefore increasing sales for merchants, if the security of the transaction can be guaranteed without imposing unnecessary friction or checks on the consumer. AI is at the heart of our “behavioural payment” prototypes, the concept of which is to enable the authentication, without any possibility of doubt, of a given customer via simple recognition, transparent for a person, to see their behavioural pattern on a website or in a mobile app or in the context of a particular activity. Worldline offers solutions of this kind for the video game industry to simplify micro-payments, by detecting the unique way in which each of us uses, for example, a gamepad.
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Optimising transactional costs for merchants
Another case is optimising transactional costs for merchants. Indeed, the costs of payment methods and brands that a merchant may want to offer their customers to enable them to pay can be very different and represent significant financial challenges. To reduce these costs, Worldline uses AI to offer dynamic transaction routing solutions and chooses, upon each payment, the best option for the merchant according to the customer’s country, the amount of the purchase, the currency etc.
Lastly, as the payment industry is a mass service industry – we process hundreds of billions of transactions worldwide every year – AI offers significant potential for improving all services associated with the payment product. By making it possible to create experiences and interactions on an industrial scale while remaining personalised, fluid, and multi-channel, AI has immense scope of application in our customer relations, incident management and complaint handling services.
The new advances in AI therefore have real potential – not for a radical transformation of the payment sector which, being highly regulated, interoperable, and standardised, must comply with rigorous standards – but by offering us new levers for improvement that will make purchasing and payment even simpler and more secure, while optimising costs, efficiency, and quality of service for users.
Gilles Grapinet is CEO of Worldline