Inside Money: Welcome to the post-cheque world

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The post-person delivered me two items of historical interest: a cheque and a credit card.

Of the two, I preferred the cheque but, like the postal service itself, both pieces of antiquated financial technology could be close to extinction.

The end of the cheque has been nigh for years while just-released NZ-pioneered online eftpos technology could drastically reduce the demand for credit cards, for example.

Elsewhere, the rapid pace of technological development is seeing financial institutions develop ever-more sophisticated ways to seamlessly siphon money off their customers.
As this Financial Times article details, banks globally are designing a range of such technologies.

"[Institutions] expect big developments in areas such as contactless payments, as wearable payment devices such as wristbands and watches are improved, and security, as banks adopt biometric identification to screen customers instantly," the FT story says.

Futuristic technologies such as eyeball and fingertip vein scanners are already in use, the article says, with more outlandish schemes in development including, perhaps, the wrist implant the petrol station guy warned me about last night.

"What I don't get," he said, "is how they would expect electrical devices to work inside us. We're all conductors right?"

I quickly paid cash, leaving him to resolve the problem of combining physics, biology and finance alone.

However, it's not just banks leading the financial technology revolution, according to the FT.

"... as the banking market evolves, lenders are facing an increasing threat from rivals outside the industry, such as Google and Facebook - which have been making inroads into areas such as payments and mobile money - and peer-to-peer lenders," the FT story says.

Technology is also leeching into other areas such as financial advice. According to this release from Australian exchange-traded fund (ETF) specialist firm, ETF Consulting, the rise of auto-advice is inexorable.

"One of the identifiable trends in financial advice in the US and Europe is 'online investment advice'," the release says. "It sometimes goes by the impersonal name of 'robo advice' but a more appropriate title is 'online automated investment service'."
Whatever it's called, ETF Consulting head, Tim Bradbury, is bullish on the technology's potential.

"This type of business will polarise and confront some traditional advice, trading and wealth businesses - that is only natural," Bradbury says. "Change is inevitable and this technology has the potential to attract many more investors to seek some advice assistance."

After consulting the internet, I decided to bank the cheque, cancel the credit card and buy my petrol elsewhere in the future.