Retail Payment Systems
In the OIC Member Countries
22
Table 4. Features and characteristics of retail payment innovations
Features Characteristics
Funding type prepaid, debit, credit
Access channel
POS, internet, other telecommunication networks, branch/automated
teller machine (ATM), other
Access device computer, mobile phone, telephone, card, other
Main usage P2P, P2B, B2B, government payments
Market impact high, medium, low, pilot phase
Product group
internet payment, mobile payment, innovations in the use of card
payments, EBPP, improvements in infrastructure and security
Access
technique
remote, proximity (contact, contactless)
Scheme owner bank(s), non-bank(s), both bank(s) and non-bank(s), central bank(s)
Cooperation banks only, bank(s) and non-bank(s), non-banks only, no cooperation
Purpose
improved security, improved efficiency (reduced use of cash or cheques,
lower processing costs, speeding-up of processing, overcoming
infrastructural lags, inclusion of unbanked or under-banked, government
payments, fostering competition, improved convenience, other)
Focus
payment initiation, overall payment process and clearing and settlement,
payment receipt, new scheme
Ondrus and Pigneur (2005) propose the use of a matrix to segment the retail payment market
according to type of technology and service providers involved. These two axes of
decomposition provide a better overview of the market with its different initiatives (see Figure
1). The cells on the top correspond to the product launched by financial institutions and MNOs
together or separately. On the bottom, the cells represent the retail payment systems
introduced by newcomers and intermediaries. On the left, retail payment schemes are based
on card technology while on the right, the cells symbolise payment solutions using mobile
technology.
Figure 1. Classification Matrix
Source: Adopted from Ondrus and Pigneur (2005)
II I
III IV
OPERATOR-DRIVEN
(FINANCIAL INSTITUTIONS, MNOS)
SELF-ORGANISED
(NEWCOMERS, INTERMEDIARIES)
CARD-BASED PHONE-BASED