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PULSE® Perspectives - July 2023

Each quarter, PULSE reviews the most important developments in payments to provide perspective and expertise for issuers. This quarter, the potential impact of ChatGPT on payments caught our attention. Combined with the challenge inherent in mobile real-time payments and consumers’ growing comfort with digital payments, technology advances clearly remain an important focal point for issuers.

ChatGPT and Generative AI in Payments.

The intense buzz around ChatGPT has caught the attention of the payments industry. Business Insider reports providers are excited to unlock the potential of the technology’s underlying generative AI. ChatGPT is a conversational AI model built by OpenAI and has become the most talked-about technology of 2023. The most significant likely use cases for payments include authentic chat, personalization, credit scoring, payment optimization and fraud detection. But security and compliance remain concerns.

PULSE Perspective: Generative AI offers transformational potential by empowering companies through human–machine collaboration to address key business challenges. Institutions should study and test generative AI tools and explore potential use cases.

Real-Time Payments on Mobile Devices.

The U.S. Payments Forum has published Real-Time Payments with Mobile. The white paper is aimed at educating the industry on Real-Time Payments use cases on mobile devices. The free resource explores the opportunities and challenges associated with leveraging mobile devices and their impact on RTP demand and adoption.

PULSE Perspective: RTP transactions are not subject to Regulation E, which could leave consumers unprotected when they authorize transactions that turn out to be fraudulent. Building in pre-authorization safeguards for RTP on mobile could help minimize consumer losses.

Consumers Believe Digital Payments Secure.

A survey of U.S. consumers by disbursements fintech Onbe found that 73% prefer to shop and pay with digital methods while 70% prefer to receive payments digitally. The 2023 Future of Payments Survey also found that 63% of consumers believe digital payments are the most secure as opposed to other forms of payment such as money order, cash or check.

PULSE Perspective: In a recent interview with PYMNTS CEO Karen Webster, PULSE President Dave Schneider offered his thoughts on how financial institutions can bring even more consumers into the digital fold. One key is to educate them on all of the available cardholder payment options.