As More Pay by Smartphone, Banks Scramble to Keep Up

from NYTs

Ryan Craine hates carrying cash and finds writing checks to be a headache. He doesn’t do much of either anymore — he mostly uses his smartphone to pay for things.

Mr. Craine, a 28-year-old tech support worker in Washington, D.C., uses Apple Pay at the stores and restaurants that accept it. About 20 times a month, he turns to Venmo, a digital wallet for transferring money from one person to another, to pay his share of rent, meals, groceries and utility bills. To refinance his student loans last year, he went to an online lending start-up, Earnest.

Mr. Craine’s money choices point to the millennial-led shift toward new digital financial services, a change in behavior that threatens to upend the consumer banking industry. The popularity of the services has left the major banks rushing to adapt, even as they have regained their footing after the financial crisis.

If the banks fail to meet the challenge, Brian Moynihan, the chief executive of Bank of America, warned in November, “it may allow part of our industry to be forever taken away from us.”

More here.

Posted in Business, Innovation, Technology and tagged , , .

One Comment

  1. In the year 2018, all of technology is starting to be more mobile and less and less seems to be done in person, the capability of our phones in this generation is very scary, from our phones we can order taxis, pay bills and do many other important things.
    Apps like PayPal allow you not only to make purchases but it also allows you to transfer money to friends and family. Many online websites use PayPal because it is a faster way to checkout. PayPal also offers protection against fraud so if you bought something or were scammed they offer you the chance to get your money back.
    As someone who is heavily against carrying money, I haven’t been to the bank since I first opened my account, I frequently find myself either using ATM’s or many apps to transfer money. I also found that apple pay has personally been a very important creation as it is accepted in many places and all I simply have to do is bring out my phone and simply scan it on the chip reader. Even at my barbershop, I can easily pull out my phone and use it to pay my barber. Also as mentioned in the article it is also easier for us to transfer money to friends and family. Through apps like venom and cash you can easily send money to friends and family without having actually cash on you. This also helps in the globalization of the world, these apps also allow you to transfer money to people all around the world. It is important that the banks find a way to keep up with this, because these apps also provide a lot of ease because I remember in the past when you went into the bank you had to pay a fee just to see someone, but through these apps you can just transfer and make purchases as needed.
    This poses an interesting question with the banks which is what is going to happen with the future of cash, if we are moving at the rate we are moving in today, in the next 5-10 years, we might see little to no cash around any more. The reason the bank might still have a couple more years of succeeding is because of the adults who still believe in going to the banks in order to get money or make any transactions. Many companies are being forced to become more technology savvy because it allows them to maximize their sales since so many people are now paying with different apps.

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