Digital competency is increasingly becoming a core competency for financial institutions. Users’ consumption behavior are migrating to online, scenes are increasingly concentrated in online, and financial institutions will lose touch with these consumer trends and online scenes if they do not have digital capabilities. And digitalization is the basis for realizing data-based operations, and without adequate digital capabilities, the application of big data and artificial intelligence lacks a foundation. From products to processes, financial institutions need strong digital capabilities.
The bank card is a basic product of the bank, carrying a bank account, based on which it can provide services such as payment reprinting, consumer finance and wealth management. Only when the bank card is digitized, the various financial services can have a digital foundation. The digital bank card is the key infrastructure for financial institutions to enter the digital journey.
The smell of digital transformation of bank cards
Recently, UnionPay held a conference to announce the launch of the Borderless Digital Bank Card. The digital bank card is not simply a card that doesn’t need a physical card anymore, but also comes with many innovative features. Shao Fujun, chairman of China UnionPay, said that the digital bank card has three main features.
The first is to form an effective linkage with the cloud flash payment APP, bank APP, mobile phone manufacturer clients, etc., to establish a fully online operation mode, to achieve online multi-channel fast card application, tie the card, use and management of bank card mobile operation closed loop.
Second, relying on innovative payment technologies such as card-code unification and token 2.0, it has created diverse new functions. Card-code unification helps cardholders directly recall their digital bank cards and payment QR codes with a single key and independently choose to complete payment through non-contact payment or QR code payment, which is safe and convenient; UnionPay Token 2.0 technology promotes the convenient application of digital bank cards for tying cards on third-party platforms and merchant terminals, supports cardholders’ convenient card use in multiple scenarios and across platforms, and effectively ensures the security of cardholders’ account information.
Third, it provides cardholders with richer and more distinctive card rights and interests, and focuses on digital scene services to build a digital payment ecosystem.
UnionPay’s innovation is based on its insight into the consumer market. Although mobile payment seems to be more popular than ever, there are still many scenario-based pain points that need to be solved by digital innovation technology.
Recently, the central government has repeatedly stressed the need to “gradually form a new development pattern that takes domestic large circulation as the main body and promotes domestic and international double circulation”.
Digital finance will play an important role in the formation of the economic internal cycle pattern. Convenient payment covering various scenarios, access to card rights and value-added services, and the assistance of consumer financial products will accelerate the economic internal cycle and provide new momentum for China’s economic growth.
UnionPay is duty-bound to support the national development strategy. As the leader of the Payment Department of the central bank said, “the nation will prosper if science and technology flourish, and the country will prosper if innovation is strong. It has a great responsibility and glorious mission to promote the scientific and technological, digital and modern transformation of the national economic industry and financial service system. The Boundless Digital Bank Card launched by UnionPay is in line with the trend of the banking industry moving towards digitalization and provides a set of digital infrastructure for the digitalization process and the construction of core competitiveness of China’s banking industry. As Chairman Shao Fujun of UnionPay said, the UnionPay digital bank card is not just an ordinary bank card, but also an important carrier to promote the deep integration of the payment industry and innovative technology, and an important measure for the digital transformation of the traditional business of banking financial institutions.
Why does UnionPay want to make digital bank cards, what pain points can it solve for users and what help can it bring to the banking industry?
New consumer groups: we’re different
Nowadays, everyone is focusing on young people and the Z-age consumer group, who are the main force of future financial consumption, and only by gaining the favor of this group of users can we say that we have gained a ticket to the future of payment and consumer finance business. What are the characteristics of this group? Unlike the 70’s and 80’s, the biggest characteristic of the young people nowadays is that they have been living in an era of relative material abundance since they were young, and have not experienced the shortage economy, and have not worried about the provision of basic life products and services. This determines their consumption attitude and consumption psychology is different from the 70s and 80s, he can’t accept your high service, can’t accept your cold service, you can’t wait for him to come and consume your products, you should have the technology and channels to find him at the right time and push the service to him.
In addition, such young groups since childhood to live in the era of Internet popularity, as the Internet aborigines, most of the consumption has been through online mobile channels to solve. Even in scenarios where they have to go offline for consumption, such as dining, hairdressing, fitness, etc., they use online apps to make their choices and pay with online payment tools.
Also, young groups are fashion-conscious and advocate social sharing, your products should have a sense of design, meet the user’s needs for value, and express values and emotions in the product concept.
Is it difficult to serve such a group? Today’s users, younger users, are more demanding, if not more demanding, in terms of the friendliness and perfection of the service. To serve such groups, it is not enough that you have a set of products, you have to have digital and online capabilities, the ability to actively push products and services to potential users, and the products also have enough aesthetics.
This is UnionPay’s observation of the new consumer base. The unbounded digital bank card of UnionPay also wants to help the friends in the banking industry to make better products that are more suitable for the new consumer group.
Pain points of digital financial products remain
Digital payments are a key aspect of consumption, and there is no getting around it, and it is the preferred way of consumption by new consumer groups. There is no doubt that our mobile payment penetration and frequency of use are leading in the world. But is it true that we are now perfect for mobile payments? Definitely not. Let’s look at a few real-life examples that are very real.
For example, if a customer eats at a small restaurant and sweeps the merchant’s payment code to pay, there may be a problem with the system and the payment page won’t open no matter how much you sweep. Finally, the payment is completed by sweeping the shop owner’s personal micro signal to transfer money. At this time, if there is a product that supports NFC payment, you can use a touch to achieve the payment, much more convenient.
For example, in a popular restaurant, there are a lot of people at the end of the meal, so you need to complete the payment and then go to find a seat. This time open the app, scan the payment code, lose the password to complete the payment, the whole process is actually quite tedious, the payment is complete, the seat was also occupied by new people, you can only wait for a seat. Buy breakfast, too, in the morning rush to work punch card, now the code scanning process is bi-complicated, wasting more time. When checking out at the supermarket, it often takes several steps to open the app and bring up the QR code, and the process can be even longer if the user is running low on phone memory and the app is slow to respond. For users, they actually expect more convenient payment methods and payment processes to appear.
This is not to say that QR code payments are bad, but rather that companies should provide users with a variety of options to leisurely scan the code to pay when time is plentiful. When time doesn’t allow, users can be allowed to pay via NFC touch and go. In this way, the utility that the new technology comes to give to users will be greatly enhanced.
Reinventing the digital infrastructure of banks
Problems in the digitalization process will be solved by digital means. As the banking industry continues its digitalization process, the Boundless Digital Card can serve as a digital infrastructure, using innovative means to solve users’ pain points and help card issuers improve their service quality. When you solve the pain points that others have not solved, users will naturally come to you.
In response to the above obvious trend and the obvious pain points of users in payment, UnionPay solves the problem through the innovative function of “card code integration” in its Boundless Digital Banking Card products. There would be some problems if there was only a simple option to scan the code to pay. If the network signal is good, users can pay by QR code; if the network environment is bad, NFC can be used to solve the problem of poor network signal and make users pay faster when they are in a hurry to complete the payment process. Users can activate the card code page with one key, which can be swept to pay, and the process is shortened without having to call out the payment code step by step, making the payment process shorter and more convenient.
In addition, Boundless Digital Bank Card will also solve the problem of users wasting time tying up their cards repeatedly at multiple merchants. Nowadays, there are often relatively mainstream apps for each scenario, and it’s really troublesome to tie the card back and forth for each app. Users have to tie the card on this app, and then to that app to tie the card.
To address this pain point, UnionPay, based on the token2.0 technology framework, can realize convenient tying of digital bank cards on third-party platforms and merchant terminals to facilitate centralized management of tied card information, which can be tied at one time and can be used in a variety of scenarios. Users can use the bank app or cloud flash payment to quickly tie up cards at multiple merchants without having to submit card information repeatedly at multiple merchants, and users can centrally manage their card tying information at all merchants in the bank app or cloud flash payment, and untie or modify the transaction control parameters of the merchants as needed.
Image source from the Internet
In addition, token 2.0 technology ensures the security of user information. The payment token, or token, is used instead of bank card numbers to stay on the websites of merchants and payment institutions, ensuring the security of payment transactions and preventing critical information from being leaked.
In addition to the ease of use, there’s also the ease of the application process. You can hardly expect a young man today to go to your bank branch and apply for a bank card, he wants to do it online. Boundaryless digital bank card application is even easier, UnionPay and bank app can be applied for online, 7 by 24 hours online service, for users do not have to wait until working days to go to the branch to apply.
As mentioned earlier, products given to young users should have a sense of design in order to gain his goodwill. The interface of Boundless Digital Bank Card overturns the traditional interface mode, the main page is beautiful and atmospheric, and the UnionPay logo and bank LOGO are placed at the back, which is more in line with young people’s aesthetics.
Nowadays, young people also have a characteristic, advocating cost-effective consumption, you need to let him feel the use of your product, access to a lot of benefits, benefits. Since it is a bank card, a product that covers consumer scenes, it has to have relevant benefits. The Boundless Digital Bank Card enables full-scene payment and overlays five major rights and interests such as superstore gift vouchers, top-up repayment, membership, user protection and cross-border cashback.
Many of the rights and benefits are already familiar to you, and now you can focus on the cross-border cashback rights and benefits. For a long time before the epidemic, outbound travel was a major hotspot, and new consumer groups were very much in favor of outbound travel and shopping. Banks have been overseas for quite a long time. In terms of cross-border consumption, UnionPay’s full accumulation of resources in overseas merchants will give the digital bank card rich usage scenarios. 30 million overseas merchants developed by UnionPay can pay by digital bank card, and 1% cashback for overseas consumption, giving users real convenience and benefits.
The future of digital bank card
Under the market background of the sweeping wave of online consumption, the trend is for banks to digitize. It is easy to see that UnionPay’s heavily weighted launch of the Boundless Digital Bank Card deeply fits the direction of the digitalization of the banking industry, forming its own unique advantages in the competition with Internet companies and financial platforms.
Based on the Boundaryless Digital Bank Card, UnionPay’s close partnership with major banks paves the way for financial digitization on the one hand, and will create greater value for the banking industry on the other. The banking industry is now pushing forward with an open strategy to embed accounts, payments, lending and other capabilities into specific scenarios through an open API platform. Boundless digital bank cards will become an infrastructure for open banking, better serving more online scenarios, expanding the coverage of banking products and increasing the scale of transactions. UnionPay has already launched the “Baidu Flash Payment Card” jointly with Baidu and Baisin Bank, enabling deeper integration between banks and the Internet scene ecology.
With the convenient payment of UnionPay’s unbounded digital card and the rich scenes accumulated, the digitalization of the banking industry is bound to unfold in a more efficient way. It is believed that the digital bank card will be promoted among more banking partners, helping banks to overcome the thorns and waves in the online consumption scene.
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