Size and strength are often considered as parameters of success. Despite modifications that have taken place till date, this perception is still the same. The “little guy” is still considered as “underdog”. Time and again, this perception has been challenged many times in the past. It’s now 10+ years for me to be in payment sector, and I have seen many situations challenging this opinion. During my period, I have seen many small startups growing at a high rate, more than any other established enterprises. But, how? The answer is simple – by owning the capability to deliver and invent, by getting the needs of increasingly connected customers and by investing in increasing rates of e-Commerce and m-Commerce in North America.
Last year, David and Goliath: Undergoes, Misfits, and the Art of Battling Giants by Malcolm Gladwell, tried to challenge our conception of the power dynamic between the giant and the “little guy”. The Goliath was the huge one, and what made him own his power, strength and size also made him most vulnerable. Goliath was an incredibly strong man outfitted from head to toe in Bronze armor which made him difficult to attack. Despite his great strength, his vision was poor which further limited his ability to close range one on one attacks only. The author supported the fact that now David’s victory is not that much impossible as it was considered before.
The fact supported above is valid in all fields, including the payment sector. The initial researches that I carried in this field in early 2000s disclosed an environment ruled by large banks with no or very little innovation over last few decades. In fact, the payment technology has not developed or improved much over this period. Built on difficult to follow and improve the legacy system, these banks still hold all the power of this sector. I immediately realized payment sector as a field full of opportunities and launched first of my two payment startups.
Being giant in your industry does not imply anything. If it makes you powerful, it is also the reason behind your slow motion and short-sightedness. When your existing system is running favorably, you become reluctant to think of improving it. On the other hand, startups are known to be responsive and quick thinking. The already established giants keep following their traditional ways when startups focus on “how to make it better?” and “What’s missing from existing system?”
The present era is the era of technology and last few years have seen great developments in mobile technology. This rapidly changing mobile technology has greatly influenced our way of doing businesses and further endowing Davids of the world with loads of opportunities. The swapping of currency with goods & services is still the same and imparts relative stability to the payment industry even at the time of variations in the global economy. But, the new inventions like mobile point-of-sale and near field communication are altering the ways of these swaps. These are just a little portion of the whole scenario of developments responsible for shifting the power from traditional banks to sprightly payment startups owning a sweet spot in between the consumers and merchants, banks and credit card companies.
An entire new section of payments playing field is being created by these startups allowing new and more transactions in this field. These startups are posing great threats to the industry supremacy of banks along with merchant service providers. This is possible because these startups not only touch transactions from both sides but also establish direct relationships with consumers.
Now, the payment startups exactly know that they have to generate such products that allow customers to pay when, how and where they want. Every startup, even those who already started with one specific channel, is coming with new and convenient products to satisfy the needs of its multi-channel consumers. We, me, and my company staff, also believe the same and have developed and launched a full multi-channel product matrix including mobile, online and in-store payments, all under a single account. We believe that contentment and dormancy lead to the end of innovation, and so we are still striving hard to produce new payments options for consumers.
Also Read: E-Commerce – A Complete Guide
At present, it has become easy to enter into the payment sector, thanks to the new technologies including mobile, open source databases, and cloud computing. And because of this, the industry is blessed to have new players with a fresh approach and intelligent brains. These new players are often small and are rewriting the David and Goliath tale by exploiting their freedom to innovate quickly. They are taking out the Goliaths from the industry and are establishing themselves by understanding the needs of the consumers and delivering accordingly.