The versatility of the digital payment infrastructure makes it suitable for both in-person transactions and online shopping. With numerous benefits, the most notable features are its security, transparency, and reduced costs.
The payments industry is growing in leaps and bounds, with various alternative payment modes taking the floor. From contactless cards to QR codes, many innovative payment mechanisms have gained traction owing to the popularity of E-commerce platforms. Mobile applications have become the doorway to availing of all kinds of payment services, given the ease it offers customers to make purchases with just a few clicks. This explains why mobile payment adoption is expected to reach 4.8 billion by 2025.
We’re witnessing a rising need for a simplified and transparent payment ecosystem that was lacking in mainstream workflows. In such a scenario, it makes perfect sense to evolve with technological advancements that are disrupting the way purchases, and payments are made. APIs have made it possible for the legacy infrastructure to adapt to changing customer needs. The use of APIs has no doubt streamlined payments by interconnecting the entire landscape, but they also pose some risks that one needs to beware of.
Mobile Wallets Are the Norm
Globally, the transaction volume of digital wallets is set to sail beyond the $10 trillion mark by 2025, as per The Wall Street Journal. The use of digital wallets has made bill payments quicker and more streamlined, with fewer steps involved. Mobile can be easily used for one-click payments without having to connect to the bank’s server every time a transaction occurs. This is crucial for the customer experience, as it will, in turn, ensure lesser cart abandonment rates.
Additionally, improving the UI plays a big role in successful cart conversions. Rebranding the “Pay” button also does that trick in many cases, such as in Uber. One-click payments have given a much-needed boost to the adoption of digital payments by pre-saving preferred payment modes.
High-Speed Internet Penetration
Digital payments are designed to be frictionless by being entirely electronic and lightning-fast when made through the latest payment processing infrastructure. The ideal scenario for a cashless economy is when payment transactions are done using various gadgets such as cars and TVs in the era of IoT. The rise of such innovative commerce owes to the expansion of the payment acceptance network.
Although digital payment growth has been the fastest in emerging economies, the total transaction value in the U.S. is also forecasted at a rate of 14.66% CAGR for 2023-27. The largest segment of digital payments in the U.S., as per Statista is E-commerce, which has also witnessed significant growth owing to the popularity of convenient and instantaneous payment modes.
Alternate Digital Payment Methods
There are many more innovations on the verge of breaking out, considering how the pace of development in the payments landscape is unprecedented. The manner of authentication and the degree of security will keep improving as threats keep evolving with technologies. So, newer and better payment options are inevitable. This calls for continuous upgradation by the merchants too. And since it is an ongoing process, an experimentative mentality often comes in handy. AI/ML is the biggest technological prowess of the current times, and the algorithms are evolving much faster than was ever expected. Leveraging these tools for intuitive payments is the best way to thrive in today’s digitally-forward world.
Partnering with Payment Enablers
FinTech experts enable businesses such as traditional financial organizations to modernize their payment processing to gain a competitive edge in the economy. Payment enablers take away the hassle from these companies in managing the technicalities by developing tailored products and offering them an innovative solution suite of payments.
The economy is gradually shifting toward decentralization, and digital payments lie at the core of such a feat. It will ensure easy credit for all and give back autonomy to the transacting parties for ease of doing business. Reach out to our experts to know how your business can simplify money movement and solve pain points in commerce.