With the entry of human beings into the information society and the application of new technologies, the innovation of payment media is accelerating the transformation and giving birth to new industries. In the information society, commercial organizations are continuously improving payment efficiency, reducing transaction costs, and forming new industries and business models through step-by-step media innovation.
1. Payment media innovation promotes qualitative changes in the industry
1) The first generation of innovative media: magnetic card payment.
Innovation in payment media in the information society began with commercial banks. The advent of magnetic cards (credit or debit cards) eliminates the need for users to carry heavy cash or checks, greatly reducing the risk of theft. The innovation of this payment medium has not only given birth to the "card association", an institution responsible for inter-bank clearing, but also completely changed people's consumption habits, consumption amounts and the business model of the industry, and a large number of new players have emerged.
2) The second generation of innovative media: intelligent hardware +**
The popularization of smart hardware has promoted the innovation of the second generation of payment media, and the emergence of mobile phone scan code payment products is driving industry changes and making third-party payment companies stand on the stage. In terms of users, there is no need to carry even a plastic card, and they only need to use a mobile phone that they will inevitably carry with them, so that they can pay more conveniently and safely. On the merchant side, the cost of QR code payment (access, maintenance and handling fee costs) is lower, and there is a tendency to replace magnetic card payment.
In this wave of media innovation, third-party payment institutions have successfully entered the market with the help of this trend, and then innovated business models, setting off a storm of "Internet finance". In 2013, the traditional currency** was sold in secondary packaging with the help of mutual third-party payment platforms, and the product was released for one month, and the scale of funds has exceeded 10 billion; In 2014, as the payment industry was widely involved in ** sales, wealth management product sales, small loans, consumer credit and credit services, Internet finance became an emerging hot spot of social and capital concern, and the valuation of the companies involved reached new highs. In 2015, the People's Bank of China and other relevant institutions took the initiative to supervise, which further promoted the industry's major moves in terms of licensing, capital cooperation and cross-industry alliances. Internet finance has become a sunrise industry on the tuyere.
Internet financial companies seized the opportunity of media innovation brought by smart hardware to solve the long-tail needs of users in specific scenarios, set off the first round of climax, and achieved explosive growth.
The trend of smart hardware is far from stopping, and the innovation based on smart watches, smart glasses (there are 800 million myopia groups in China), smart homes, smart cars, and VR devices are all called the focus of the industry. However, when the industry is talking about the various possibilities of future intelligent hardware, biometric technology is quietly forming a new direction of media innovation.
3) The third generation of innovative media: biometrics and its three strategies.
The dividends of the mobile Internet are drying up, and Internet financial companies are exploring the next innovative technologies to solve the rapid customer acquisition and efficient commercial use in various scenarios to promote sustainable growth. Innovations in areas such as big data and artificial intelligence have become options. As a branch of artificial intelligence, biometric technology is becoming one of the most likely directions due to its technical reserves and rapid large-scale commercial use in the Internet finance industry. Various institutions have deployed and developed biometric technology, hoping that it can accelerate rapid customer acquisition, fast transactions, and simple and practical, so as to compete differently, and compete for customers and scenes. Limited by regulatory requirements, technical reserves, the characteristics of their own ecosystems and information security considerations, major companies have gradually formed three different models for the development of biometric media innovation:
Mode 1, terminal strategy, focuses on hardware-based fingerprint and iris recognition and authentication. Typical representatives are mobile phone manufacturers such as Apple, Samsung, Huawei, Xiaomi, etc. The main business of this type of company is the production of smart terminals, and its recognition technology focuses on loading hardware on mobile phones, storing user fingerprints, iris and other biological information in the security chip of the terminal, and its strategy is to acquire customers through the hardware ecosystem, load recognition capabilities at the operating system level, and open identification capabilities to its own or cooperative Internet financial services, so as to achieve ease of use and fast transactions, and then improve its own ecosystem.
The second mode, cloud strategy, focuses on software-based face and voice recognition and authentication. Typical representatives are emerging Internet companies such as WeChat Wallet and JD Finance. These companies are mainly engaged in smart services and applications, and their recognition technology focuses on collecting biometric information such as a user's face and voice, which is stored in the cloud. Its strategy is to develop secure and efficient comparison capabilities, which can be applied to scenarios such as remote account opening, rapid identity authentication, identity fraud prevention, and rapid application for credit products, and can also achieve fast login and fast payment in some secure and controllable scenarios.
Mode 3, comprehensive layout strategy, while developing its own identification and certification capabilities, and hardware manufacturers to establish a "certification industry alliance".Typical representatives are companies such as Ant Financial (IFAA) and Lenovo (FIDO). The strategy of such companies is to fully grasp the user's biometric information at both the cloud and the terminal end, and can provide efficient and customized comparison services for all customer acquisition and transaction scenarios. This model has a huge investment in resources, long-term layout, flexible scenario applications, and a better user experience for customized solutions.
The above three different modes of biometric development represent different choices for companies based on resource backgrounds and business needs, and their commercial scenarios are about to explode.
4) Innovative medium: financial services based on blockchain and cloud technology.
In the future, just as there are power outlets in every corner, cloud services will become the infrastructure of society and will be ubiquitous, and portable smart hardware will become a thing of the past, and people will be able to access cloud services anytime, anywhere by authenticating unique biometrics. The medium of payment is digital currency based on cloud blockchain, and the new financial service format formed based on public or private blockchain may be a complete revolution in the industry.
In the future, innovation in the media will be at the heart of every change. Users are more convenient, merchant costs are lower, the rules of the industry are reformulated, new players stand on the stage, and enterprises that cannot adapt to change will become more and more bleak.
Second, the three stages of future industry development
Based on the widespread popularity of intelligent hardware, the rapid customer acquisition and user efficiency improvement brought by biometric technology, combined with the accelerated development of big data and artificial intelligence technology, the author believes that the Internet finance industry is entering the second round of climax, which will form three stages:
1) Phase 1: In 2017, the number of users of hardware-based fingerprint payment will show explosive growth.
In the past two years, various hardware manufacturers have successively unified fingerprint payment standards, and fingerprint models have become standard. The industry is well aware that entering passwords is outdated, and fingerprint payment operations take much less time than card and cash transactions, and are more secure. The process of users easily getting started and using a large number of fingerprint payments is the process of market reshuffle and Internet financial companies to develop users and seize the market.
Internet finance companies represented by Alipay and WeChat Pay have preemptively completed the market penetration of QR code payment. Clearing institutions represented by UnionPay, Visa and Mastercard have also completed cooperation with hardware manufacturers such as Apple and Samsung, hoping to continue to maintain market share with the popularity of fingerprint devices. At present, the market has formed two distinct camps: the bank camp of swiping mobile phone + fingerprint and the Internet camp of scanning code + fingerprint.
Based on the explosive growth of fingerprint payment, there will be two far-reaching impacts, one is that mobile phones will replace bank cards to become the mainstream medium of payment, and the other is that Internet financial companies will take advantage of the "home advantage" of mobile phones to continue to expand the market share of scanning code payment, and provide additional long-tail financial services such as wealth management, consumer finance, and credit, and traditional offline business halls and face-to-face services will further decline.
2) Phase 2: From 2018 to 2019, the application scenarios and customer acquisition of face recognition will soar.
The core value of Internet financial services lies in "anytime, anywhere" and "online low cost".Face recognition technology is the most direct means to realize these two values, such as the first time users can make impulsive purchases, they can open an account, open a new mobile phone number, apply for installment loans, apply for consumer credit, and if users can complete identity verification without waiting and continue to follow up operations. The value of face recognition lies in breaking business hours, breaking offline business outlets, and acquiring customers anytime, anywhere.
Although due to technical capabilities, security restrictions and regulatory restrictions, face recognition is not able to complete this series of work independently for the time being, this technology is currently more used in auxiliary verification scenarios (such as face verification after remote customer service) and low security requirements (such as ordinary business opening and face recognition login, etc.), but in view of such strong demand, more and more scenarios are using face comparison, and major domestic Internet financial companies are testing the water in a large number of ways to use face technology to accelerate customer acquisition. It is believed that starting in 2018, the application scenarios and the number of customers acquired by faces will soar.
3) Phase 3: After 2020, cloud-based big data and blockchain technology will generate commercial scenarios.
Although cloud-based big data technology has not yet created value in the financial field, its clear development trend has become an industry consensus, leaving a huge space for the imagination of the industry. The same cloud-based blockchain technology has also gained a lot of eyeballs and has been tested in the inter-bank clearing scenario of some financial enterprises.
Blockchain technology and digital currencies based on blockchain technology may change the entire industry in the future. A digital currency can be an internally circulating "currency" issued by a company or a consortium of businessesFor example, a clearing institution uses digital currency as the clearing unit in its system, and each currency unit of the user is not only unique, but also inherently anti-counterfeiting. Payments and clearing based on digital currencies could create entirely new industries, with radically different accounting and risk management systems, and entirely new trading and financing scenarios.
Digital currency may also be the central bank of a country directly issue official currency, using blockchain technology to lay out the financial network from the central bank to financial institutions to clearing institutions to individuals, which may have a more revolutionary impact on the entire economy and society.
The popularization of smart hardware has brought about a reshuffle in the industry, and the successful promotion of QR code payment products has enabled Internet financial companies to take the initiative in the competition. Both banks and Internet finance have chosen fingerprint payment to consolidate their market share, and fingerprint payment users will usher in explosive growth in the short term. The second half of the competition in the market competition is about to kick off, and the fast, efficient and low-cost customer acquisition value brought by the application of biometric technology will become more and more significant. Cloud-based big data and blockchain technology may revolutionize the future, but when, and how will it change, the dust is far from settled, and I am afraid that it will continue to be a hot topic in recent years.
However, whether it is intelligent hardware, biometric technology, or the scenario application of big data and blockchain technology, it is impossible to "plug and play", and its prospect research, technical reserves, platform integration, and scenario commercialization all require a long cycle. Of course, "local tyrant" companies with unlimited resources and financial resources can attack from all sides, make active preparations in various possible directions, and make full preparations in advance for possible industry changes. For Internet finance companies with limited resources and distinctive characteristics, it is a feasible way to choose a strategy that suits them, invest appropriate resources at the right time, focus on key scenarios, and produce predictable customer acquisition results.
3. Mobile phones are still the mainstream smart devices
The above looks forward to the industry development trend driven by the transformation of payment media from a macro perspective, corresponding to the current specific media innovation, one is intelligent hardware, and the other is intelligent recognition. How quickly this trend will come and how far it can go depends to a large extent on the development of technologies such as mobile computing, wireless transmission, and batteries, and the infrastructure construction of information equipment.
In recent years, the innovation of smart hardware has been changing with each passing day, and the ultimate goal of all smart devices is to replace mobile phones and become the next must-have terminal for users. Along this business logic, all smart devices that are more "necessary to carry" than mobile phones have the potential to become the next outlet, such as smart glasses, smart shoes, smart jewelry, smart clothes, and so on. However, before chips and batteries are further miniaturized, the mainstream portable smart devices in recent years are still mobile phones, and mobile phone clients are still mainstream products. In the future, according to the development law of reducing the burden on users, glasses, watches, and bracelets may become the next generation of mainstream portable smart hardware after solving fatal defects. As an Internet company focusing on software, it can stay on the sidelines in the near future and only do basic R&D and reserves.
Regarding intelligent recognition, due to its strong dependence on hardware, it can be divided into monopoly recognition technology and non-monopoly recognition technology according to the monopoly of hardware. Fingerprints, iris, 3D face modeling and other recognition methods are forcibly monopolized by hardware vendors, and data is stored in hardware. In contrast, the hardware permissions such as cameras and microphones, which are relied on by technologies such as 2D faces, voices, and voiceprints, have long been unconditionally open as standard on mobile phones. Based on these non-monopoly hardware, Internet companies can independently develop, encapsulate and integrate their own identification technologies to provide customized services for their own business scenarios. In recent years, the multi-party wrestling between the two types of forces has just begun, innovative applications are in the ascendant, Internet companies rely on a large number of users to occupy the sky, hardware manufacturers rely on the hardware monopoly of the small ecosystem to occupy the geographical advantage, and the competition of intelligent identification technology standards and application scenarios has just begun.
Seize the change brought about by scanning code payment, so that the third-party payment company can pay the user base of the business accumulation, and enter the financial business, and the "Internet finance" it launched is more similar to the brand concept, but the change itself has not subverted the financial industry. After several years of development and precipitation, the "dividends" of new media are running out, the first mover has completed the layout, and the traditional financial institutions that "make a big U-turn and turn slowly" have gradually begun to follow up. Up to now, new technologies such as payment media and big data have not changed the way of financial integration, and the operation and management model, supervision model and business model of financial products have not changed. Before the real change in the financial industry comes, there may be a period of 3 to 5 years of industry adjustment and consolidation. In this stage, the main theme of payment institutions will be to be licensed and more deeply involved in traditional financial business, with the help of technological innovation, and accelerate the integration with the traditional financial industry in the deep water area.