COVID-19 has massively accelerated the growth of e-commerce. What do innovation opportunities in Payments look like in post-COVID world? Highline Beta has put together Crisis Manifesto: Innovation Opportunities in Payments post-COVID report. Today, we talk with Eric Kryski, Co-Founder of Bidali about the future of cryptocurrencies and gift cards. Bidali helps businesses increase sales and eliminate fraud with next generation payments and more flexible gift cards.
We sat down to speak with Eric Kryski, Co-Founder of Bidali about the future of payments post-Covid-19.
- Can you explain a little bit about what Bidali does?
Bidali helps businesses increase sales and eliminate fraud with next generation payments and more flexible gift cards. We do this by allowing businesses to accept cryptocurrencies and for people to spend cryptocurrencies at businesses via these gift cards.
At Bidali, we think cryptocurrency is the future of money. But for that future to become a reality, people need to perceive it just like money. Nobody needs to know about blockchain mechanics, the currency needs to be stable and you need to be able to spend it on real things. That’s why we’re seeing progress with branded cryptocurrency in the gift card space.
Currently, we have over 1000 businesses live on our platform in 150+ countries. We have many more global brands in the pipeline. And soon, we’ll be launching a mobile app that enables people to earn crypto cash back on purchases and send money around – sort of like Venmo meets Drop.
- How has COVID-19 impacted your business? Have you seen interesting data on payments and behaviour (spending, preferences, etc.) that you could perhaps share?
We’re continuing to see user growth and revenue growth. We had our best month in February, a drop in March and we’re now ahead of that and up 25% across all metrics. We’ve had a few brands drop off due to their chapter 11 bankruptcy, but people are buying gift cards at Walmart, Amazon, Home Depot and CVS. The transaction volume, revenue and customer growth is still going well.
In terms of payments and behaviour, a recent report found that there was a 30-40% decrease in credit card spending in the US. People were spending more online but discretionary spending has been cut overall across all verticals.
What do innovation opportunities in Payments look like in post-COVID world?
Highline Beta took a deep dive into payments innovation opportunities and trends, and released Crisis Manifesto: How Payments Will Evolve post-COVID report that examines massive consumer behavior shifts and features industry research and lessons from over 70 startup and corporate stakeholders.
- What are your thoughts on the changes and trends you are seeing in payments? What specific gaps, blind spots and opportunities has COVID-19 exposed? What existing trends have been accelerating and why?
Right now, we’re seeing a rapid digitization of everything including money. There’s already a discussion happening around this transformation and especially from the central banks. We’re working with some of them on their new digital currencies and have been talking to a couple governments about powering their digital currency solutions as well.
Countries have been wanting to digitize their money as a response to Libra for a while. But now it’s become even more pressing. They don’t want people using physical cash in order to encourage physical distancing. In some countries with no digital payment methods, governments are concerned about how the commerce is going to be done. Fraud is increasing during the pandemic – so how do we prevent that? In crypto, you just can’t fake transactions – that’s sort of the point.
- What role will creative collaborations play in shaping the future of payments and finance on the other side of the pandemic?
Collaboration between companies and startups is critically important. The challenge around payments is that it has been slower to adapt to vertical. Banks and financial institutions are slow. It’s really important now that we start seeing payments innovation, but this requires collaboration. Nobody can do it alone. We’re lagging on real-time payments compared to Europe and Asia and I can think of lots of big companies that would benefit from touchless payments. We have work to do.
This is partly why we focused our business efforts on the gift card angle and why we’re extending our platform to engage businesses that have gift card programs. We don’t aim to replace people’s full payment stack – and we’re seeing better reception with this approach.
- What do you think it will take for cryptocurrency to be embraced more widely in 2020 and beyond?
The best approach I think is to roll out in certain geographic areas and within specific industry verticals where you solve an immediate problem. When I was in Davos speaking to central bankers and governments about cryptocurrency, they didn’t know how to transition from physical money to digital without people being left out. If you have an existing system you’re dependent on, especially larger countries, the transition can be hard. It’s much easier in small countries where the cost of failure is low and you can get coverage quickly like some of the island nations or industry specific verticals. We’re seeing success in traceability and royalty settlements or specifically working in beef/grain, focused on one specific niche.
- What do you think is the future of cryptocurrency payments for 2020 and beyond?
In terms of the future, we’re seeing gift cards leading the way in crypto. We’re looking to onboard new businesses into issuing gift cards to our platform, and we think this is a synthesis around how crypto will go mainstream. Brands will issue their own branded digital currencies as a replacement for in-store credit. However, we still need to lobby the government for progressive regulations. Industry collaboration is incredibly important related to crypto assets. Right now, the broad brush is “any crypto asset is likely a security issue or a derivative” so you have to be licensed or registered. We need to ask for more clarity and provide more solutions around this.
The future of successful companies will rely on a willingness to embrace strategic alliances, listen to new consumer needs and act decisively in uncertain times. Please read the full Crisis Manifesto: Innovation Opportunities in Payments post-COVID report here.