COVID-19 Impact on Payment and the Case for Mobile and Digital Walletin the Information and Communication Technology Industry
The pandemic started with its epicenter in China in 2019 and has been continuously spreading by then to all over the world, so far 216 countries and territories have been affected with COVID-19, the U.S. being on the top with cases reaching to about 2.1 million, followed by Brazil and then by many European countries such as Russia, Spain, Italy and others. The COVID-19 cases reaching to the big named countries with strong dominance in the global market which has adversely affected the economy globally. The spread of corona virus has led to the global recession, many companies are being bound to take stringent actions of laying of their employees, small business are being shut, manufacturing facilities are being put on hold. There has been a disruption in supply chain of many industries due to restriction in logistics and closing of manufacturing facilities. In addition, the slowdown in economy has lowered the spending capability of individuals and people are saving money for emergencies.
As the pandemic hit globally, employees are advised to work from home, and operate remotely as much as possible. Population is becoming more inclined and reliable towards the use of digital platforms and internet services for relevant information and for handling the office work from home through digital platform. This has eventually created a series of opportunity for digital platforms, services and solution providers to increase their customer base with relevant products for making payments. The financial institutions need to capture this opportunity by building the digital solutions integrated on smartphones which are quick and effective to support various businesses, merchant and customers in this slow run of economies globally. With the spread of the virus globally, individuals are avoiding any sort of physical contact to protect themselves, in this case digital payment is aiding them by providing contactless payment solution through digital wallets, mobile apps, or tap to pay cards.
The evolution of payments has accelerated due to the high adoption and penetration of smartphones and growth in digital wallet. Even companies are taking digital transformation for sustaining the development. The companies that would be able to recover from this pandemic crisis would need to be digitally stable, understand the customer needs and would need to respond to the rapidly changing market.
The need of the customers would evolve after the pandemic and they would depend more on digital platform for the need of transactions, loans and other financial services. This shows how the growth of payment market will increase which are supported by digital wallets or smartphones, individuals are preferring e-commerce more than the physical shopping on stores which will change the behavior of shopping experience among the customers, this will help the digital wallets to gain larger share. The government had already been taking various steps to boost the digitalization and payment and the case for mobile & digital wallet market by initiating various rules and regulations. For instance, in 2018, the U.K. government announced the implementation of PSD2 (Revised Payment Services Directive) which made the financial institutions to share the customers banking data to third party on a secured platform.
IMPACT ON DEMAND AND SUPPLY CHAIN AND LONG TERM STRATEGY ADOPTED BY MANUFACTURERS WITH THE STEPS TAKEN
Payment market is highly affected by the growth in smartphones and digital wallets. Taking the payments to online platform has provided the users with much ease and flexibility to make payments. Smartphones have simply revolutionized the financial services market by bringing in technology such as digital wallets, near-field Read more...