2020 Confronted unpredicted challenges. The unforeseen incidents moved industries to the digital world. These shifts reshaped the competitive dynamics of the payments. Thus emerging new payment methods powered by disruptive technologies will be at the heart of 2021 digital payments.
While there are numerous trends in the payments space, a few of them can ultimately bring in significant impact across the industry.
Modern Payment Methods
With the growing digital customer base and new shopping demands, there is a high requirement for businesses to shift to highly efficient transactions. Nonetheless, customers always look for seamless shopping experiences that are well-versed with easy payment methods.
The e-commerce industry is offering instant and effortless transaction options to its consumers. Merchants are making necessary changes to their payment infrastructure to scale up and equally compete with their competitors. The new payment methods also help businesses to serve customers in the long-run and meet their demands.
During the pandemic, most merchants approached and appreciated the modern payment methods that are working efficiently.
Needless to say, the pandemic forced consumers to check out their carts online instead of offline shopping. But just one error or friction could make the shopper turn back on the online store and look elsewhere. This remains the major challenge for merchants. Hence, digital merchants agree upon the fraud prevention mechanisms that could provide smoother shopping experiences to their customers.
In the coming days, enterprises need to reimagine the fraud prevention strategies to remove redundant frictions, reducing false declines, and offering personalized customer services to each individual. In reality, the fraud prevention trend remains on the high priority list with increasing demand to position the business in front of the customer.
Financial services have seen a wide range of disruptive trends in payments, banking, and technology. They are embedded in a variety of software and applications. This trend is referred to as embedded finance, which created a new role for technology in the financial lives of consumers and enterprises. The embedded finance had shown a significant impact for Shopify, Lightspeed, Square, and Grab companies.
With the emergence of embedded finance, traditional financial institutions will now have to retain and attract customers in the finance space. Probably, this year will significantly see more tech companies offering better financial services to their consumers.
QR codes are likely to grow to offer an easy checkout option to customers. As a result of the pandemic, merchants have already introduced no-contact payment methods. Merchants can present a QR code to shoppers — either by POS terminal or printed. These QR codes, linked to the payment gateways allow users to complete transactions in real-time.
Digital payment applications are rising with multiple features that enable easy and instant payment methods to customers. Digital wallets have grown up with payment centric feature. However, this is going to see a drastic change.
In 2020, several US-based players moved to “super apps” that offer various features such as cryptocurrency purchasing, banking services, investment opportunities, interactive offers, etc. This will push towards broader digital wallet services.