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Capitalize on electronic payments, avoid risks

Jan 07, 2014 Dave King

Capitalize on electronic payments, avoid risks

The electronic payments market continues to expand and evolve rapidly amid the constant proliferation and diversification of platforms, techniques, equipment and consumer preferences. Financial services providers, as well as businesses in retail and service providing industries, must become more proactive when it comes to new electronic payments deployments to remain competitive in the increasingly digital market landscape.

Any business that is beginning to deploy electronic payment systems will need to focus on the two most critical aspects of management: Security and usability. A balance of data and system control with the most optimal ease-of-use for clients and employees will generally yield the most preferable results.

However, failing to meet the management demands of electronic payments can come with devastating consequences for the average organization.

First, hop aboard

Mobile Payments Today recently asserted that banks and other financial services companies need to launch mobile point of sale (mPOS) strategies to survive in the coming years. According to the news provider, studies indicate that many firms in this sector are taking a timid approach to the new technology and strategies, which is likely putting them at a distinct competitive disadvantage going into the new year.

Research from a variety of entities, including IT and financial services advocacy groups, have revealed that the modern consumer - and employee - demands access to Internet-based banking services. Companies that do not have a clear and refined electronic payments strategy in place will not be able to sustain loyalty among existing customers, or attract the optimal number of new prospects in the near future.

Mobile Payments Today explained that there have been several developments in the mPOS market, but that initial leaders have sustained their stranglehold on the industry. However, there is still plenty of room for growth, so long as competitors are putting their best feet forward. In fact, some experts believe that more novel electronic payment providers need to emerge to strengthen the overall market.

"It's difficult for banks to keep up with everything happening in mPOS payments," Mobey Executive Director Sirpa Nordlund explained to the source. "But they do need to educate themselves about what is going on, as they can't afford to leave mPOS to the likes of PayPal and Square ... Our advice to banks is that they shouldn't make uninformed decisions about mPOS payments."

Then, secure
Infosecurity Magazine reported last month that several suspects have been arrested in connection with one of the bigger cybersecurity breaches to hit the financial services sector this year. The news provider explained that the attack struck largest investment banks in the nation, and that the suspects allegedly set up fraudulent ACH cards and accounts to steal money from the victim.

ACH, wire and mobile electronic payments have become favorite targets of hackers and cybercriminals, and as such must be secured using the most advanced solutions available. Financial service providers, as well as any organization that has ACH and other electronic payment capabilities in place, can protect themselves from theft through data and network security software.