In the latest in our series of blogs on the BPC annual client conference we explore some of the key issues covered in a panel discussion on the use of technology to optimise the urban environment.
The phrase ‘smart city’ is an established element of the technology lexicon, but what makes a city ‘smart’? Our view is that the answer lies in advanced solutions that address the issues its citizens encounter every day.
On this basis, a panel discussion participated in by Leyla Mamedova (cash management and corporate banking specialist at Pasha Bank Azerbaijan), Vasil Dimitrov - CEO and management board member of DSK Mobile EAD Bulgaria - and Terry Jones, managing director of Barbados-based Leading Edge Technology Solutions looked at what this means for mobility, micropayments and inclusion.
Dimitrov kicked off the discussion by outlining some of the ways in which cities are implementing smart technologies, such as digital administration services as well as smart city solutions relating to payments for public transport and parking. According to Dimitrov, one of the challenges these cities are facing is finding the funding for new projects.
Mamedova elaborated on this point by stating that not only is urbanisation a challenge globally, but that the readiness of cities regarding implementation of new technologies needs to be considered. She does, however, make it clear that in cities where the infrastructure is immature, implementing these technologies is simpler. Jones observed that smart cities are in the news and a point of discussion due to their status as part of government policy. Governments are making major investments in smart city infrastructure, rolling out citywide Wi-Fi and smart parking, for example, and the fact that the state is behind the roll out is what makes people confident that it will go ahead. He reiterated the point made by Mamedova that when you build from scratch, you are able to build how you want to and negate many of the challenges that arise from dealing with legacy technology.
Next, the speakers were asked about technology and possible trends - with a focus on open versus closed loop - and whether they thought the modern alternative of open loop payments would eventually replace cash and closed loop-based payments.
Dimitrov was the first to comment, saying he thought open loop schemes were already replacing cash payments, especially in terms of single travel documents as they offer longer paid subscriptions and bigger discounts for certain usage.
The pandemic has meant there has been a call for prepaid subscription services as this makes the transition from office to home more frictionless. Dimitrov reckons the technology is already there to build on and that the switch to open loop systems is easier.
Mamedova commented next, saying people in Azerbaijan are ready to move on from cash. The example she used was Sumgait, a smart city which will be using a totally open loop system due to the demand to move away from cash usage and improve aspects of everyday life.
In order to overcome the issue of not every inhabitant having a contactless card, Mamedova suggested giving out prepaid cards. However, she says the biggest issue is getting people who are used to the closed loop system to trust the open loop system.
Jones was asked to discuss the use of payment innovation to create smart cities. He suggests giving the customer choice is essential by allowing them to use the most convenient option. Customers have been found to enjoy segmenting their prepaid cards into areas of finance, which Jones says allows them to feel like they haven’t paid as much. Options and education are the two features Jones says will allow these technologies and systems to thrive.
Finally, all the speakers were asked for their thoughts on the next big thing in urban mobility. Mamedova began by saying she saw the move from cash to completely cashless transactions being possible one day, noting that projects run to date have been a success regarding implementing open loop systems, providing customers with solutions that help them achieve sustainable growth.
Jones believes that once customers get comfortable using the technology within transport they will use it everywhere. He agrees that smart city infrastructure is there, but adds that it is the technologies that sit on top of it that will determine how effective it is. If cities are successful in rolling out transport-related services, expansion becomes easier, so Jones thinks the next big thing will come out of adopting a smart transport strategy.
Dimitrov concluded by suggesting the most significant development will be combining technology systems, using different media as customer payment instruments.
