Report prepared for ACSC100: Academic Communication in Science Lecturer: Louise Katkins

Scientists should work to develop an innovative technological payment method that would be effectively utilised by the Australian community.
PUABD1301
Student ID: PUABD1301
Group 4
Monday, 22 April, 2013 Word Count=
Future Payment Methods

Table of Contents

Introduction 1

Literature Review 2

Discussion 3

Conclusion 4

Reference List 5

Introduction

Due to insufficient coordination amongst the key stakeholders in the finance industry in Australia, there has been a lack of systemic innovation in the country’s payment systems. The architecture of Australia’s existing national innovation system is now a generation old. The policies it comprises require renewal.

However, significant forms of innovations have been currently ongoing. These innovations are expected to have a profound effect on the payments market over the next several years.

The Board of Australian Payments Clearing Association (APCA) established the Card Payments Forum as a way of pushing forward industry based initiatives.

An inaugural meeting of the Forum was held on 27 October 2008 where participants commissioned further work into the issue of payment innovation.

This research report will attempt to give insight to the review in retail payment systems in Australia. It will also offer a basis of discussion on how to reach the optimal level of innovation in the Australian market.

Literature Review
There have been changes in the payment landscapes in Australia in the last decade. Cheques have been replaced to a certain degree, although not quite completely, by electronic alternatives.
Edgar and Dunn & Company (2009) state that cheque activity is still being used by businesses and the elderly but have been decreasing in volume and value. Australia has been introduced different electronic alternatives like PayPal, BPAY, BillExpress and PostBillPay. Many of the industrialists interviewed for the study believe that the current payment system offers Australian consumers a variety of choices when it comes to payment decisions.
However, (“Strategic Review of Innovation in the Payments System: Conclusions”, 2012) states that although Australia has a reasonable record in terms of payments system innovation, some of the systems are clearly no longer of cutting edge technology. It notes that there is still room for providers of payment services to offer consumers with more flexibility and more choice and at the same time at a lower cost.
Recent studies by outlined by Fagg (2013) suggest that quite recently, Australian innovations are actually being developed internationally in other countries rather than locally within Australia and therefore might have affected the pace of innovation in Australia.
Australia can adopt innovative ideas into the local industry or rather stop outsourcing innovations to other countries, and therefore work on improving payment products and the retail payment system.

Discussion
Edgar and Dunn & Company (2009) point out that consumers in other countries have been familiarised and have been utilising direct debit payment and other advanced innovative forms of electronic payments whereas Australian consumers are relatively unenthusiastic about the innovation drivers in the market. Industrialists state that the lack of drive in innovation in Australia is partly due to the fact that there is a very small amount of consumer pressure for innovation.
Innovation is not as strong in the Australia markets as in the international markets, partly due to the face that existing systems are effective. * From a consumer’s perspective, Australia has a highly banked population (with transaction accounts), high uptake of internet banking, minimal fraud cases, effective cheque clearance and low cost * Due to the perceived riskiness, most financial organisations prefer to be