Treasury Today Country Profiles in association with Citi

Visible benefits to offering invisible payments

Person using mobile to pay for shopping online

Making the payment process invisible can bring value to customers and businesses.

The evolution in point of sale payment technology has seen customers move from cash to card to mobile; each step bringing with it increased speed and convenience. Spanish lender, BBVA, thinks it is time to reach payment nirvana by making the point of sale payment process invisible.

To make this happen, the bank publicly launched its ‘invisible payments’ strategy last month. The main purpose is to remove all friction from the payment process, making it as easy as possible for businesses to sell, and customers to buy.

Working example

The bank’s strategy is not just an exploration into the concept of ‘invisible payments’; it is also about making this happen as soon as possible. Indeed, the bank is already trailing the technology that it believes can make payments invisible in the cafés at its Ciudad BBVA headquarters.

Ignacio Banon, Global Head of Payment Solutions at BBVA explains that staff at the bank’s headquarters are now able to reserve a table, eat and leave without even asking for the bill or making a physical payment.

To do this, diners simply download an app, designed by the bank alongside Sodexo Iberia, register an account, provide payment details and biometric information – namely a headshot photo – and then book a table at the restaurant.

Upon arriving at the restaurant, diners ‘check-in’ using the facial recognition cameras, which designates them a table. Diners then order food, with every item tracked in the app creating a real-time bill. Once finished, diners simply open the app, approve and close the bill, triggering an automatic payment to the restaurant.

Customer customisation

Banon explains that the most obvious benefit of this solution is the speed and efficiency it brings to the payments process. “Paying in this way means that customers don’t ever have to queue, something that can often prevent the sale taking place,” he says.

However, invisible payments can enable businesses to begin learning more about their customers, providing the opportunity to offer bespoke experiences.

“Data streams, properly and securely managed, and expertly analysed, are the key to businesses everywhere becoming better partners to their customers,” says Banon. “The more a business knows about its customers, their behaviour and their drivers for retail purchases, provided it never abuses this trust, the more it can do for them.”

Banon provides a simple example, explaining that if the system logs the spending habits of a café’s customers and finds that many are buying a coffee and muffin every morning, then it can prompt the café to offer them a special buy-one, get-one-free deal every so often. Doing so can increase customer satisfaction and is something that previously only firms that operated a loyalty scheme were able to offer.

Broad applications

Whilst BBVA is in the early stages of experimenting with invisible payments, the bank is in talks with several big retailers to pilot the solution. “Anything that allows greater interaction with the customer, but in a way makes their experience easier and more tailored to them, is a great opportunity for any business,” says Banon.

He is keen to note that the solution is not only applicable to large retailers and that one of the challenges he has set his team is “adapting the solution to match different merchant verticals and sizes”.

The end of cash?

It is an odd time for payments. At one end of the spectrum, cash remains widely used. Then at the other end, we have the emergence of solutions like ‘invisible payments’ that completely digitise the process.

For treasurers, this creates an interesting challenge. It is currently necessary to manage legacy collection processes such as cash-on-collection, whilst harnessing the full power of digital payment mechanisms like invisible payments.