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Will payment methods enable seamless personalisation?

Will payment methods enable
seamless personalisation?

David Daly

Deal Assurance Manager

Question: what do most of us carry with us almost everywhere we go?

Answer: a way to pay for things. Not so long ago it would always have been cash. These days, it is commonly bank cards and our phones. In the future, maybe it will be our biometric information (fingerprint, iris, or even facial recognition) or even technology “implants”.

The move away from cash as the default method of payment corresponds with a move away from payments being anonymous. The methods of payment we now use are also forms of identification. The transactions we make are inherently linked to our identity and vice versa. This creates a digital dilemma, raising concerns about privacy and how this data is used, but also bringing great benefits. For example, one of the key drivers for governments to push demonetization is the potential upside benefit of reducing fraud. But there are also benefits for individuals too: being able to “tap” onto and off of transport using a payment method and being billed the correct amount for the journeys you have taken is enabled precisely because your payment method can also be used to track which journeys you have made.   

An apparently unrelated parallel trend is the personalisation of goods and services. Once upon a time, a car dashboard consisted of hardware buttons and dials, permanently engineered on the factory floor. Any modifications afterwards were time-consuming and expensive. Now my car has user profiles so that different drivers can customise the dashboard to their tastes and recall these settings via a tap on a touchscreen. It used to be, when I was travelling abroad, that I would have to guess how to use an ATM menu presented to me in any language other than English or Dutch. Now, I can almost always select which language I would prefer to use. Personalisation is everywhere: from home lighting, to the font size on my phone, to how brown I like my toast, to my preferred room temperature, to what radio stations and podcasts I listen to, to what accounts I use to access Spotify and BBC iPlayer (and the recommendations they provide).

But eventually, the sheer potential to personalise everything around us creates a new challenge: complexity. Sure, my car knows what radio stations I listen to, my TV knows which iPlayer account I sign into, my Hue Bridge knows which colour temperature I prefer my lights to be, my digital thermostat knows what temperature I like my bedroom to be at night, and my digital shower knows what temperature of water I prefer. Yet, when I visit a hotel, I have to setup all these things again.

What if something that I already always carry around with me could also be used to let the objects around me know what my preferences are so that they can adapt to me automatically?

What if, rather than having to obtain a key-card at the hotel reception desk, my payment method acts as the key to my room? And when I enter the room, it is already configured in the way I would like? The heating is set. The TV logged in to iPlayer. The radio tuned to BBC Radio 2. The shower set to 39 degrees centigrade. The lights set to warm-white. Not only does this create a better user experience, but also it makes the potential to personalise all of these things into a reality, by eliminating the complexity. It can also make my experience more secure. As soon as I leave the room, I can automatically be logged out of the services I have accessed. And if I should lose my payment method, then cancelling it will automatically also prevent anyone from using it to access my hotel room and online services.

The switch from anonymous to identifiable payment methods, coupled with the rising trend of personalisation, will create an opportunity to create seamlessly personalised, safer, and higher-value experiences for consumers.