Michael Concannon
Head of Strategy and Development, Fintech and Payments Association of Ireland (FPAI)
New regulation and technology will drive opportunities for improved cashflow and help stimulate innovative payment solutions.
Recent years have seen a rise in digital payments as customers adopt new technology and payment methods. According to the Central Bank of Ireland, contactless payments at Irish points of sale such as shops and restaurants accounted for €2.4 billion, with €1.3 billion from mobile wallet payments such as Apple Pay or Google Pay. Instant payments and the digital euro are now on the horizon, which will streamline trade within Ireland and across Europe.
Instant payments to improve cashflow
Within the next 18 months, all banks and payment service providers will offer instant payments, on foot of new legislation from Europe. This will allow the instant transfer of money 24 hours a day, 365 days a year. The infrastructure will be introduced by banks and payment service providers and will speed up the settlement cycle and improve cashflow for SMEs. For customers, it will increase the speed and convenience of payments, and we will likely see the introduction of innovative payment methods at the point of sale.
Within the next 18 months, all banks and payment
service providers will offer instant payments.
Digital euro expected to stimulate further innovation
The digital euro will be a universally accessible electronic equivalent of banknotes and coins, which will complement cash. European legislation is being developed and the EU has entered what it calls the ‘Preparation Phase.’ Although implementation will be some years away, it is anticipated that all retailers in the EU will be required to accept the digital euro when it becomes available (probably in the form of a digital wallet). This will stimulate further innovation and help reduce the cost of making and receiving payments for goods and services.
Benefits include efficiencies and competitiveness
Businesses will ultimately benefit from changes in the digital payments landscape as they will bring efficiencies and help sustain competitiveness. The FPAI will be working alongside banks and payment service providers to advise and support SMEs in the implementation of the changes as they come on stream.