Payments

Fueled by changing consumer preferences, increasing penetration of fintech into the traditional payments space, and smartphone-enabled real-time payments, the payments industry is witnessing a dynamic transition. Instantaneous transactions, messaging capabilities, and immediate fund transfers have ushered a new phase in the payments industry. Commercialization of the payments industry has been fortified by the introduction of contactless payment technologies, such as NFC and smart wearables, which became the preferred mode of transactions amid the COVID-19 pandemic. With growing technological innovations in payment methods, regulatory bodies need to match pace. Increased cooperation between payment regulators & payment solution providers will accelerate the digitalization of payments and infuse the much-needed impetus into establishing a unified payments platform. The need for robust regulations amid the ongoing volatility in the cryptocurrency industry has expanded the payments industry spectrum into digital currencies.

Drivers:

• Changing customer behavior is fostering the payments industry growth. Digital disruptions and generational shifts are influencing customer behavior & expectations from payment solutions.
• Governments are constantly supporting the adoption of digital payment technologies as a measure to reduce physical contact, track down financial transactions, and prevent tax fraud
• Moving forward into 2023 and beyond, three major trends are expected to reshape the payments industry: embedded finance, cryptocurrencies, and Metaverse
• The metaverse will blend multiple immersive technologies such as AR & VR into the payments ecosystem, allowing merchants to develop innovative payment methods
• The gradual evolution of regulatory frameworks to integrate cryptocurrencies within mainstream financial services will broaden the product spectrum for payment industry players