4 Trends that are transforming the payment industry
February 1, 2020
In recent years we have witnessed, as cardholders and merchants, drastic changes in the payment industry. Facing a new decade, there is no doubt that these advances will continue to transform year after year. Global payment trends seem to be evolving towards a more “consumer-centered” experience, focusing on ways to make payments as intuitive, easy, and convenient as possible. These trends show this commitment to integrated payment processes and the significant decrease in the percentage of cash payments.
According to the Federal Reserve (U.S.), the use of cash has lost its leading position as the preferred consumer payment method. Analysts predict that the use of cash will continue to decline over the next five years as a result of factors that include continued growth of integrated digital commerce (e-commerce) and new payment options aimed at the modern consumer.
Contactless payments (NFC)
Banks are issuing contactless payment cards. These cards, which feature the innovative near-field communication (NFC) technology, will allow users to tap their credit cards near a reader in a terminal to make their purchases up to a certain amount. The same technology that allows merchants to accept payments with a contactless credit card will also allow them to accept mobile wallets or wallets such as Apple Pay, Google Pay, and Samsung Pay or payment with smartwatches and portable devices.
Signature not required
In 2018, card brands erradicated the requirement to sign a credit card transaction. With advances in payment security technology, such as artifical intelligence (AI), tokenization, and EMV for monitoring payment data, the transaction authorization process with a signature has become obsolete.
Trends like the Internet of Things (IoT) technology has the potential to provide smooth and seamless payment experiences. Just as car drivers with RFID sensors drive through pay tolls with a card as payment method on file, consumers can select their items, leave the store and receive a purchase receipt in an app, email or SMS.
Consumers have been adopting fingerprint (biometric technology) to unlock their smart phones or devices, make payments and authorize bank transactions. Fingerprints and other biometric identification technology to approve payments are making transactions a lot safer. Along with the payment trends towards consumer convenience, there is a tendency to make security a priority. Each technological advance aimed at making payments easier and convenient should be accompanied by innovative security measures.
Keep up with the latest security trends
It is vital to provide your customers with the most up-to-date solutions, showing your customers that you are up to date with technology and that payment security is taken seriously. In 2020, look for more stringent measures to collect and share intelligence about threats and stop fraud. Contact one of our payment trends specialists at 787-783-8689 or send an email to [email protected].
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