A report by ABI Research shows that countries like Singapore, Dubai and London are racing to implement connected infrastructure, testing the latest in smart transportation and energy systems to become one of the first actual "smart cities."
But before these countries introduce features like self-driving transportation or self-sufficient solar power sources, they must be sure citizens are ready to use simple IoT in their day-to-day lives.
Mobile payments are the perfect way to ease users into smart city technology and will be essential to lasting innovation.
By transforming a traditional treasury into a cashless economy, cities will open the doors to wider and faster adoption of more complex smart city innovations. Governments that go cashless can even bring down the cost of managing physical cash or checks, leading to transaction cost reduction.
This, of course, takes a collective shift of mindsets and habits. Here are three ways that mobile pay platforms will kickstart the future of smart cities:
Prioritizing secure transactions and a digital ID: Driving a full-fledged smart city starts with generating consumer trust in automated connections and transactions. Many consumers are hesitant to adopt mobile payment platforms due to a fear of getting hacked or a general preference for physical (rather than digital) money management.
Banks and mobile platform developers alike can encourage the adoption of interconnected transactions by promoting security with a robust digital identification system. If users feel safe transferring funds, depositing checks and withdrawing cash from their mobile device, they’re likely to be more comfortable with future smart city initiatives like mobile document signatures or automated bank clerks.
Optimizing the future of retail and government services: Both brick-and-mortar and online retailers are curtailing their platforms to cater to an Amazon-like experience, and mobile payment platforms will make it easier than ever for consumers to get onboard. Mobile scan-and-go solutions and app-driven promotions encourage shoppers to opt for mobile pay over cash to get the best deal, and this promotes that critical digital mindset for shopping as a whole. Since cashless transactions depend on a digital identity, it is fantastic way for retailers to implement loyalty programs and gain customer insights. Mobile payment adoption in the retail space will pave the way for advanced smart shopping experiences to become the new norm, such as automated check-out systems or optimized grocery delivery services.
Changing the way we commute: Mobile payments are already changing the way we commute by speeding up the tedious process of purchasing bus and subway tickets. In fact, London transportation companies have been dissuading customers from using paper for some time by introducing contactless payments into their tube stations. A mobile pay capability for public transportation will not only speed up the commuter payment process, but will give developers more insight into commuter patterns, making it easier for smart cities to implement next-gen features such as traffic management tools, alert systems, and tailored commuter travel paths.
Smart cities are destined to change the way we live, but the payment processes behind each smart innovation must first evolve to keep up with these technological developments. To establish a strong foundation and therefore drive adoption of new smart initiatives, smart city planners should prioritize implementing a mobile payments platform that ensure seamless experience for citizens.