The numbers say it all. A recent survey reports that tap-to-pay transactions have increased 30%, while almost 50% of customers say that they don’t shop at stores that don’t offer digital modes of payment anymore.
Indeed, the global health crisis has played a crucial role in further digitizing various business processes, especially payment. Websites like https://merchantalternatives.
The question is, what’s next for digital payments, and what will be the next key digital payment industry trends? In this article, we are going to list down the top six trends that we can expect in the near future. Here they are:
One of the growing concerns involved in making digital payments is its safety. After all, issues involving identity theft and fraud using digital data are not unheard of. These troubling times have also lead to an unprecedented increase in cyber attacks.
According to the most recent report of Interpol, they have received almost a million complaints within a single four-month period from their private sector partners. 59% of these attacks involved phishing, scams, and fraud.
Even more troubling is that the significant number of targets happened to be individuals and small businesses.
Fortunately, there are increasing efforts to further tighten cybersecurity. One of the methods that are currently being developed is biometric authentication.
This involves incorporating unique biological data processing (such as facial recognition, fingerprint scanning, and heartbeat analysis) into digital payment transactions to add another layer of security.
In relation to the previous trend, you can also expect an increase in voice-activated payments. This has been made possible with the help of the various voice AI technologies that are already present in our digital devices.
Just think about asking Siri, Alexa, or Cortana to send payments to other people. Pretty convenient, right? Most of the current applications that already allow this method of digital payment integrates with the existing AI technology on our smartphones.
However, we can expect businesses to eventually enable their own voice payments.
As an added bonus, this technology can also be utilized as an added authenticator when creating payments.
Since we are already talking about artificial intelligence, banking companies are heavily investing in this technology to incorporate them in their mobile applications. They have two reasons.
First, they wish to create faster and more convenient transactions for their patrons. More importantly, they also hope to utilize this technology to increase security, especially in fraud protection and prevention.
AI systems find it easier to detect patterns, suspicious activity, and potentially fraudulent information. Combined with other trends we have mentioned in this article, we have no doubt that AI will eventually set a standard in cybersecurity.
The use of QR codes is nothing new. In fact, it has been around since the mid-nineties to hold digital information better than the regular barcode. The current pandemic gave its usage a much-needed boost, though.
Surveys suggest a 57% increase in the use of QR codes in commercial transactions including digital payments in the past year.
Current trends seem to indicate that this rise in usage will further continue. After all, not only does it add speed and convenience to transactions, but it also eliminates human error when giving out account numbers and similar financial information.
We also expect efforts to tighten QR code security. Unfortunately, this method is particularly vulnerable to cyber-crime. It is not impossible for hackers to create visual clones of QR codes and use them to intercept payment information.
In 2020 alone, there had been reports of QR code scams resulting in $18.5 million in losses.
Various methods to create more seamless payment transactions will also further develop. We are talking about self-check-out options, auto-renew payments for subscriptions, one-click payments, and more.
If there’s one trend that is seemingly getting more attention than the others, that would be point-of-sale (POS) financing. It is a lending option that businesses can offer with the help of a third-party lender that provides consumers with a convenient way to purchase their goods even without immediate cash.
It also comes with a number of benefits. First, it has less demanding qualifications compared to traditional loans. The credit checks that POS finance providers make also don’t impact your credit score. Finally, it gives consumers increased buying power along with an opportunity to pay for their purchases with incremental payments.
Finally, you can also expect to see an increased dependency on cloud technology. After all, it can help resolve the following issues:
- Lost Data. No business can afford to lose financial records and other similar information. Unfortunately, storing your data in your available hardware poses a few risks.
More pressingly, they can be vulnerable to the elements and natural disasters. Fires, floods, and other unforeseen events can potentially wipe out your data.
Aside from that, your memory devices can get stolen too. It will be much easier to retrieve information uploaded to the cloud.
- Lack of accessibility. Putting your financial data on the cloud will allow your employees access even if they work remotely. The same goes for your clients as well.
Don’t worry, most cloud services allow you to provide different levels of access to ensure privacy and added cybersecurity.
- Late payments. Finally, using cloud technology can also help minimize late payments. This has been made possible due to the growing network of remote servers. Aside from that, it is also a bonus that goes hand-in-hand with the added accessibility.
Indeed, it is a very exciting time for digital payments and online banking. We haven’t even fully explored the surface of all the technologies and possibilities that are being developed right now. We’re sure that there are even more surprises in store. We have simply featured the latest updates that are most talked about these days.
How about you, which trend are you most excited about? Have you already equipped your business with digital payment methods? In the end, what’s important is to give your customers the convenience and safety that they deserve. Good luck!