Investment prospects 2022-2027 in the field of e-commerce and cloud technologies

The e-commerce and banking market has been developing by leaps and bounds over the past decade and has won its supremacy in almost all industries. At this point in time, no successful business can manage with classic bank and cash payments with retro paperwork without using plastic cards and physical terminals for transactions.

However, these technologies are already obsolete, burdensome and unprofitable. What technologies will replace plastic cards and physical terminals in the next 3-5 years? What percentage of global business will switch to innovative technologies and whether it is worth investing in them today — financial expert Nikolai Vladimirovich Neplyuev will answer by providing analytics.

Electronic banking: advantages and disadvantages

It is well known that innovations do not take root in society so easily, because neither individual representatives nor entire businesses like to leave the comfort zone of a familiar and predictable environment. In addition, optimization often in one way or another entails additional time and financial costs, staff expansion, and much more.

But if there are significant shortcomings of the previous system against the background of significant advantages of innovative technologies, the adaptation process is smoothed out and implementation is accelerated. Therefore, in order to understand the internal mechanics of changing systems and correctly predict the timing and volume of the introduction of innovative technologies, Nikolai Vladimirovich Neplyuev recommends focusing on comparing the advantages and disadvantages of systems in their opposition.

How convenient is the use of plastic cards and physical terminals for transactions and does their operation contribute to the development of commerce? Of course, in comparison with cash payments, electronic banking through cards and terminals is much more convenient and contributes to the development of e-commerce, increasing the global trade turnover by at least 30-40% in the arithmetic average.

But there are plenty of disadvantages of this type of banking. The presence of a plastic card in most cases involves issuing and receiving it offline in a specific physical place, which causes certain inconveniences. The card has a limited validity period and requires a subsequent replacement. When using a plastic bank card, you need to remember its PIN code, which is not always convenient, especially if one person has a large number of different cards. And it is not safe to write down a PIN code and carry it with you, just like posting it by text message on the network. In addition, you can forget to take a physical card with you, lose or become a victim of its theft, which creates additional inconvenience.

Physical terminals also have a number of disadvantages. First of all, the terminal is relatively expensive equipment, which puts an additional percentage in the electronic banking service system. Often, individual components of terminals are produced in different places, which requires an additional system of logistics, transportation, customs clearance, subsequent assembly and commissioning of equipment, installation of software, and the availability of qualified service personnel. Therefore, physical terminals are installed exclusively in the most crowded places, and it is extremely rare to find a physical terminal in residential areas and small towns.

Based on the above, we can conclude that this e-banking system has more disadvantages than advantages. Therefore, the use of this system, although already familiar to most, is not, in fact, a psychological comfort zone, and giving up in favor of a better new system will be simple and massive.

Neplyuev Nikolai Vladimirovich: innovations in the field of cloud technologies

Existing innovative electronic banking technologies are represented by cloud technologies and tokenized Embedded Finance services. Baas and Saas cloud technologies have already been adapted and tested by time to provide customers with the most convenient service at minimal cost. Now spending money will become easy, convenient, fast, cheap and safe. Regardless of the place of physical residence, in order to pay for a product or service, it is enough to have a personal mobile device connected to the Internet.

The payment process is carried out instantly in 1-3 clicks. Authentication does not require a PIN code, which is replaced in cloud technologies by a one-time SMS, fingerprint or face scan of the client, which is not only convenient, but also safe. Due to the lack of physical cards and terminals, the cost of transactions thanks to cloud technologies is significantly reduced, which is an additional bonus and a lead magnet for attracting new customers to the system.

Business using Baas and Saas cloud technologies reaches a new level and receives additional regulators for growth and development. Baas automated electronic banking systems allow businesses to outsource all tasks related to internal and external transactions, which significantly saves time and money, allowing them to focus on their own product.

At the same time, Embedded Finance services provide multi-channel transactions with individual settings for automatic and semi-automatic payments, seasonal discounts, cashbacks, a savings system for each individual client, collection and analytics of the database, contribute to the provision of omni-channel commerce and much more. And all this at the lowest cost of transaction fees.

Neplyuev Nikolai Vladimirovich notes that the advantages of innovative cloud technologies are undeniable. By 2027, up to 80% of business is projected to switch exclusively to Baas and Saas technologies. The growth of assets in the field of cloud technologies of electronic banking for three years is predicted to be 6-11 times compared to their current value. Risk diversification is commensurate with the experience, the number of clients and the availability of individual companies’ own developments. Startups are high-risk projects, like any other IT areas. Whereas companies that have been on the market for more than 5 years and demonstrate a positive growth trend are considered reliable and most attractive to investors.