Digital Commerce Enablement: The Case for a New Payment Network
Report Summary
Digital Commerce Enablement: The Case for a New Payment Network
Existing payment networks, in the best position to lead the payments industry toward digital commerce enablement, are hesitant to embrace change.
Boston, May 22, 2012 – A new report from Aite Group examines the payment acceptance transaction processing space, discusses what is necessary for digital commerce enablement, and details opportunities for existing payment networks and new digital commerce transaction processing networks. Based on more than 45 qualitative Aite Group interviews with industry stakeholders, this report argues that the fundamental incompatibility between mobile payments, digital commerce, and existing payment processing infrastructure has created an opportunity for a new payment network to enter the market.
A slew of providers are deploying new digital marketing, payments, and POS solutions, but the resulting closed-loop systems will lack interoperability and scalability. Significant opportunity exists for market participants to develop and deploy a new, open-loop, digital commerce network. Though existing open-loop payment networks are in the best position to lead this transformation, they are hesitant to embrace change, creating an opportunity for new players to enter the market as digital commerce transaction processing networks.
“A worldwide flurry of mobile payments and marketing investments has taken payments to a tipping point that will soon result in digitally enabled shopping and payments,” says Rick Oglesby, senior analyst with Aite Group and author of this report. “That existing payment network infrastructure and services are not up to the task has meant slow adoption, inadequate distribution channels, and a series of closed-loop environments. Existing open-loop payment networks seem best equipped to deliver a centralized solution, but are reticent to do so for sound financial and business reasons.”
The report references the following industry players: AisleBuyer, Amazon.com, American Express, Apple, Discover, Dwolla, Facebook, Google, GoPago, Groupon, Intuit, Isis, the LevelUp, LivingSocial, Milo.com, PayPal, RedLaser, shopkick, Square, Verifone, and Where.com. It profiles ACI, Adility, eBay, First Data, FIS, IP Commerce, MasterCard, The Merchant Consortium, Spindle Inc., and Visa.
This 37-page Impact Report contains 19 figures. Clients of Aite Group’s Retail Banking service can download the report.