Fintechs push to get out of the shadow of Uber, Amazon

Uber and Amazon aren’t payment processors, banks or card companies. But both companies loom as threats and trendsetters for companies that squarely are in financial technology.

As Uber makes a direct assault on digital payments and Amazon’s no-cashier Go stores proliferate, the two companies have inspired what amounts to a sub industry within the payments technology business.

Executives from four companies—Worldnet co-founder John Clarke, Payrailz CEO Fran Duggan, CardFree CEO Jon Squire, and Sionic Mobile CEO Ron Herman— view Uber and Amazon as drivers of the shift to an "unattended" retail experience that removes human interaction from the process of making a payment.

During a phone roundtable last week, the executives discussed artificial intelligence, blockchain, mobile tech, and the two big elephants in the room. Uber sets the pace for everyone to follow.

Worldnet recently partnered with IDTech to speed authorization to streamline EMV chip card payments, cutting time for the consumer to just over a second. The goal of these “faster EMV” payment features is to make the transaction less of a hassle, and thus less of an effort.

“It’s the ‘Uberization’ of the business that’s the big trend,” said Worldnet’s Clarke.

To be fair, it's not the same as the nearly seamless Uber experience, where people leave the car without making any effort to pay. But Uber sets the expectation that transactions should be brief to the point of being almost ignored. That's a huge difference from the drawn-out process of waiting for a chip card that's been jammed into a reader.

“People don’t want to think about their cell phone or their payment, and they want their transaction to be safe,” Clarke said.

Uber and other ride sharing apps such as Lyft and Grab are taking steps to become more direct competitors to fintechs and payment companies. Grab, which operates mostly in Asia, has made tangible moves to tie its ride hailing app to food ordering and bank partnerships. Uber’s collaborations in the payments business include a Barclays-issued credit card that can be managed via the Uber app; and a tie in with Venmo.

Payrailz is trying to take advantage of this trend by selling technology to banks on a software-as-a-service basis to power bill payment, P2P and other use cases, using artificial intelligence to improve user experience over time.

“It’s all about moving the payment to the background. It has to be sale and secure, but it also has to frictionless,” said Payrailz’s Duggan.