Banks are not leading in the shift towards alternative payments and more cashless societies, according to experts in the FinTech sector.

Speaking at FinTech Connect, senior players in the field discussed how alternative payments are becoming increasingly popular across the world, with each region championing a different technology or method.

“Brazil for example, it was owned by the banks, but then the government intervened and created this body and now there’s 350 FinTechs in the country,” said Yasser Abou Nasr, vice president of payments strategy and operations at Vesta, a platform that monitors global payments for fraud patterns. “There isn’t going to be one player, and banks are not leading this journey, they are trying to keep up.

“I don’t see the banks having much say or control; they’re becoming the Nokia to Samsung and Apple.”

Christophe Bourbier, chairman and co-founder of Limonetik, a payment service platform, said: “The point is that the bank used to be the major player. [But now] it’s easier to launch payment methods and financial services; banks are not the only ones that can play.”

The danger of cashless societies

David Mayes, product manager of payments and responsible gambling at Flutter Entertainment, warmed that the third of the world that are still underbanked might get left behind and lose out if societies became totally cashless.

“To get to cashless you need a generational and a societal shift,” he said. “There needs to be a combined approach; research from behavioural scientists find that having physical money helps customers understand the value – so education needs to be done by parents, governments etc.

“Banks need to be responsible, it needs to be all encompassing to give younger populations financial literacy, because it’s becoming so easy to spend money, you need some friction.”

Vesta’s Nasr says that there’s a big push towards one click payments and impulse buying, where payments have as much friction removed as possible.

“It’s the trade off of those two aspects, I don’t think were going to get away from cash,” he said. “It’s the most inclusive instrument out there; cash is still part of the digital journey.”

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