Citadele Bank (Latvia)
The introduction of technology and the digitalization of services continues to increase, but two key factors form the basis of any well-considered update: faster and easier. Technological innovations in the financial world are also created according to this principle, however they are faced with a larger barrier—people’s caution with entrusting their data and money to new technology. Nevertheless, a survey by Citadele and SKDS shows that people are willing to try new opportunities offered by innovative financial product technologies if it helps them to save time. Head of E-business division at Citadele Bank Mārtiņš Bērziņš offers his views on what innovations in financial technology are in store for us.
Pay in store with a fingerprint, face, voice
Services like Mobilly for fast and simple parking payment or Uber and Bolt for ride sharing are often taken for granted. It’s logical that we should expect similar possibilities in other aspects of our everyday life: purchasing goods in the supermarket, visiting the cinema, etc. We can already pay using a phone fitted with NFC technology, but the next step is confirming payments using our biometric data—our face, voice and fingerprint. Convenience store chain 7-Eleven has already introduced facial recognition technology for payment in its stores in China. To pay using the new technology, users must register their photographs in a separate app, as we do currently in banking apps. This opportunity will probably not be available soon in Latvia, however, Citadele is actively working on the use of voice commands for digital assistants which could create new financial services within the next two to three years, such as confirming purchases in online stores.
We are already used to being able to complete almost all transactions on the bank app, and we only rarely have to visit a branch. This is demonstrated by the fact that the Citadele app is used daily by more than 130,000 clients. To avoid seeming as though ATMs have been left out of the spotlight during the boom in mobile banking services, we can be assured that the cash withdrawal process will see improvements. We will soon see contactless technology at ATMs, meaning you will be able to withdraw cash without your card. All you will need is your phone with the bank app installed.
Pay to a phone number at the store or market
Methods of paying without using a payment card are increasing. Within two years, NFC technology has made contactless payment an everyday occurrence, and if, a short time ago, cashiers were asking “is it contactless?”, it is now rare to find a card that is not. As contactless technology made paying in-store easier, we also expect the same ease when making a transfer. Payments to phone numbers have been available to those registered in the Bank of Latvia instant link registry since last year. The registry saves a client’s account number and the data associated with it, such as a phone number. More than 25,000 people have already registered with the Bank of Latvia instant link registry. We can expect the instant link registry to become available to legal persons, and people will then be able to pay to a phone number at a store, market, or anywhere else where business owners have linked a phone number to the business’ bank account.
Innovations go hand-in-hand with security
However, despite the various innovative payment opportunities which undoubtedly make daily life easier, it can be concluded that population of the Baltics currently use them hesitantly. There are several reasons for this. First of all, people are slow to change their habits. Second, we concluded from the aforementioned Citadele survey that an unwillingness to use innovative banking services is linked with worries over fraud. To dispel these doubts and promote wider use of this technology, we must increase the financial literacy of the public. Users must understand how to use innovative financial services securely and correctly—how to apply for a service, how to deactivate it, how to control payments, and how to inform the bank if they believe a fraudulent transaction has taken place.
However, despite banks’ active work in educating clients to avoid cyber attacks (phishing), there are still a fairly large amount of people who are willing to pass their online banking details to third parties by opening links in emails or SMS messages leading them to fraudulent websites. People should always remember that the bank will never send this kind of link which requests personal information.
These are just a few of the countless innovations and opportunities in the world of financial technology which await us in the next few years. Some will come faster, some will take a while longer, but we encourage people not to be afraid of innovations, as well as to always protect their personal information.
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