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December 1 , 2016

21st century Payments-Why evolution is just not good enough!

The history of payment system products since the 1980s is one of gradual evolution. There have been few radical changes. Instead, products saw incremental enhancement over time, with many products all built on core code that was written in the 1980s and 1990s. Products like BASE24, Postilion, BASE24-eps and OPEN/2 all exhibit much the same behaviors at application level, with the di?erentiation between them based on operating system support and delivery model. They are all predicated on the 1980s/90s model of transaction authorisation processing – that is 1 pair of symmetric messages containing an entire request & response with the complete processing rules de?ned in advance, mostly as source code with a few con?gurable parameters. The history of evolution has shown that only the fittest survives.  For most, evolution ends in extinction. There are two theoretical causes for extinction.

  1. Evolution in an ecosystem inevitably leads to extinction- Because incremental gains and evolution only work so fast and can only respond at limited pace. This means that highly evolved but slowly evolving entities can only respond slowly to new threats, and to new competitors. When the ecosystem (biological or business) evolves slowly, the evolutionary giants keep up. When the pace of change increases, it becomes harder. It is clearly true that in the payments ecosystem, the rate of change is signi?cantly faster in 2016 than it was in 1990.
  2. Extinction from a cataclysmic event- It is widely believed that a meteor strike precipitated the end of the dinosaurs. This theory has been common wisdom for many years, but the latest thinking is that the dinosaurs were already dying out due to a shrinking gene pool – they had evolved to a point of extinction before the cataclysmic event pushed them over the edge.

We now need to consider if we are in such a position when it comes to the payment industry. Have the dinosaurs of the payments industry have reached a point where they are at the edge and incremental change is no longer not sufficient? The industry is facing a cataclysmic event driven by new technologies, new channels and new consumer behaviors. Is a revolution in solutions approach and a complete overhaul of the slumbering legacy systems the only way to stay competitive in this ever-changing market?

Renovite believes that it is time for a revolution, do reach out to us on to learn more about our product and services. To get access to the detailed whitepaper on this topics follow this link and look for the “Resources section”