Australians ready for IoT and AI in e-payments

Over a quarter of Aussies are now ready to use an internet-connected device, like a virtual assistant or connected fridge to make payments on their behalf, according to a new YouGov study commissioned by payment technology company Visa.

In September 2016, just 12% said they would do so, underscoring the growing adoption of digital payments in the largely tech-savvy nation.

Stephen Karpin, Visa’s group country manager in Australia, New Zealand and South Pacific, believes that internet of things (IoT) devices and biometric technology, combined with the use of artificial intelligence (AI), will also deliver more personalised experiences for consumers.

But this experience must be seamless for consumers. As futurist Anders Sorman-Nilsson notes, consumers will only use connected, AI-enabled devices to pay if the experience is easy, seamless and secure.

Many of the new payment methods are enabled by the use of biometrics as authentication – the most common example of this being the fingerprint scanner on a smartphone.

More than half of respondents surveyed by YouGov said they are comfortable using their thumbprint, voice or retina for payment.

According to the research, the appeal of biometrics is that it is more secure (45%), and that not having to remember a PIN/password (40%) is driving consumer adoption and readiness.

But while consumers are keen to embrace biometric authentication, less than half (39%) of respondents are willing to share their personal information in exchange for convenience in payments.

Karpin says this hesitance to share personal information in exchange for convenience is an important insight. “At Visa, we believe in responsible innovation – that is, ensuring that security is built in from the start and that no new technology or capability comprises the integrity of the payments ecosystem,” he says.

But it’s not just about making the entire payments ecosystem more secure. Concerns over the privacy of personal information can only be addressed if consumers know what their personal information is used for and how they are being protected.

Australia already has privacy laws that govern the collection and use of personal information and the regulations have been beefed up over the years to provide stronger enforcement powers.

Merchants will need to play their part, too, not only by playing by the rules, but to also understand that privacy protection can be a competitive advantage and a business opportunity – and not a cost centre as some might believe.