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Mortgage industry must adapt as contactless and invisible payments mould consumer behaviour – Calder

by: Craig Calder, director of mortgages at Barclays
  • 20/01/2020
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Mortgage industry must adapt as contactless and invisible payments mould consumer behaviour – Calder
As we enter a new decade, it’s clear that what consumers demanded in 2010 – and how a variety of businesses operated at that time – is a world away from what’s required in 2020.


For all of us operating in and around the mortgage market, we understand how fast-paced and dynamic this space really is.

However, it is sometimes so frenetic and all-encompassing that we don’t lift our head and take a peek outside our own bubble to monitor developments and innovations in other fields. Or how such influences might affect clients and our own business needs in the future.  

Working in such a diverse organisation as Barclays offers a wealth of insight across a host of business areas.  

One such piece was from Nick Kerigan, managing director, future payments in Barclays cards and payments division, who shared his thoughts on how technology is shaping customer expectations, what is driving the next generation of payments – and how payments are “at the epicentre of disruption driven by fintech”. 

This is a subject which may not directly impact intermediaries – at the moment at least – but there are some highly relevant points which I’d like to share as they offer real insight into what remains the most important aspect of your business – the consumer – and how they are embracing technology. 



Innovation in action

With the rise of electronic payments and decline of cash, the consumer payments landscape has probably undergone more change in the last decade than we’ve seen in the previous thousand years. 

If you think of contactless, which seems to have taken off so fast recently, it has actually been a 12-year journey, and in the first eight or so years of that there was not great growth in contactless – it was just a logo on a card. 

The tipping point was getting contactless onto the transport system in London, which started to grow adoption and usage. Once that happened it started to scale, and now contactless accounts for £6bn of payments a month. 

That has led to a big reduction in cash payments, from 34 per cent of all payments in 2017 to 28 per cent in 2018. That is a very significant change – a revolution – in the way consumers make payments in the UK. We are well past the tipping point now.

Part of customer expectations in the payment space is shaped by technology.

As consumers, we carry those expectations across different parts of our lives – if my electricity company allows me to see and manage my electricity consumption in its app, then why is my bank still sending me paper statements?

As we look at future developments in cards and payments, we look at all sorts of changes in consumer behaviour, because they all come across into our sector. 


Invisible growth 

This makes me think that – while mobile payments will continue to grow – “invisible payments” will also gain traction.

Invisible payments are when you have downloaded an app and stored your payment details, so when you take a service, like a cab, the payment is taken invisibly in the background, without you needing either cash or cards or wallet or any action whatsoever.  

However, we also have to give reassurance of control over payments and spend through notifications and electronic receipts. So, we will see lots of people innovating in different sectors, including financial services, around giving the consumer greater convenience when using a service – and greater control before and after.

As a bank, and as a lender, we are working closely with consumers, intermediaries and strategic affiliations to constantly identify their priorities, and then exploring, researching and designing potential solutions to address those priorities.  

The year 2020 is all about the customer and how technology can be utilised to offer the right types of advice and solutions for them.

This is the balance which the mortgage market must continue working hard to get right, by evaluating both what is happening within our own industry as well as those around it. 


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