RETAIL PAYMENTS INNOVATION

Prior to the modern age, private banks, rather than the central bank, provided funding for innovations in the retail payments industry. With the entry of the latter in the retail payments market, retail payments made through mobile phones and the internet today have more possibilities than ever before. Whether it be via the use of alternative value transfer techniques or the addition of more access points to current retail payment systems, all businesses have strived to increase the convenience and diversity of retail payment services. Few have, however, really taken off, and none have taken the place of conventional retail payment systems. However, the possibility that these new retail payments services may be extensively utilized raises important policy questions. For instance, central banks have qualms about potential effects on financial stability and whether this innovation would affect monetary policy. For these reasons, even if there are unlikely to be any immediate consequences, central banks continue to monitor the innovations happening in the retail payments market to make sure that even if the number of retail payments goes up, the systemic risks can still be managed.

In terms of instrumentation and design, retail payment systems are continually changing and being adopted because they offer involved parties an incentive to increase the benefits of retail payment systems since they are networks with growing returns to scale and externalities. To foster new talent and innovative ideas while averting monopoly rents, the retail payment ecosystem remains open and competitive. Solutions have been developed via coopetition between the public and private sectors. A variety of objectives and methods have also been put forward by global financial technology firms to address the problems that surface. Hence, the development of retail payment infrastructure and tools has exploded. These ideas often take a while to catch on, but financial institutions have made it easier for people to trust and accept retail payment systems.

In this paper, I have discussed coopetition, which blends competition and collaboration, and has been the subject of recent literary discussions. This study finds that coopetition and technology are among the major drivers of innovation in retail payment systems. It put forwards that banks and fintechs should work together to improve innovation and service quality. Moreover, the retail payments sector seems to be driven by disruptive technological advancements. On account of the way retail payments have been regulated, banks and other well-known financial institutions have maintained an unmatched position within the payment ecosystem. Despite this, revolutionary technologies like cloud computing have had a significant influence. This has changed how banks are seen throughout time in the context of retail payments. In this conceptual paper, I outline how the emergence of disruptive technologies has changed the retail payment environment giving an exhaustive examination of the relevant literature and a qualitative meta-analysis of the retail payment literature based on platforms, ecosystems, and behavioral principles. This theoretical literature study articulates that disruptive innovations are changing the role of retail service providers in retail payment ecosystems. This is putting established financial organizations in a tough spot.

Businesses and organizations invest a lot of time and money in different information systems. Usually, the anticipated improvement in economic performance serves as justification for these expenditures. For academic and professional organizations, a fundamental issue is the effectiveness of their information systems as modern-day managers grasp the need to invest in information systems particularly quickly. Although there are several methods for assessing an information system's success, it is challenging to quantify the benefits of an information system due to the variety of factors that affect innovations in the retail payments sector. Also, it can be hard to figure out how efficient and effective information systems are in light of new developments in the industry. A variety of academics have grabbed the chance to look at theories and models that might forecast and explain behavior in several different application sectors. The majority of this research focuses on strategies to increase the use and examines what promotes or inhibits the adoption and use of technology. It is crucial to evaluate each and consider how it may help in the creation of a model that is suitable for mobile commerce since each well-known technological acceptance theory has different premises and benefits.