There are many trends in the payment processing industry that are leading us into the future. By exploring the payments ecosystem in 2020, your business can continue to move down the path of success.
The payments ecosystem has many different elements to it, including acquirers/processors, card networks, issuers, gateways, ISOs/MSPs and non-card payments. This overview of the payment processing industry highlights how the dynamics in the payments world are moving along.
Both consumers and businesses are moving to digital payments at a fast rate.
Both consumers and businesses are moving to digital payments at a fast rate. Numerous mobile wallets are making upticks, and as a business, you need to be aware.
E-Commerce Developments
People are using their smartphones, tablets and computers at higher rates every year. This is affecting brick-and-mortar retailers and increasing the speed at which people are adopting digital peer-to-peer apps. As people increase the use of P2P payments, businesses need to be conscious of where the future is going and whether they need to update their own payments ecosystem to take advantage.
The Demand for New Offerings
Adapting to change is essential for any organization. Providers in the payments ecosystem can keep you knowledgeable about which services you need, as they best know where the industry is headed.
Trends in the Payment Industry
One of the things increasing in the United States is the number and use of in-store payment methods, with about 89 percent of retail volume fitting into this category. And while credit and debit cards are still the leaders here, contactless payments are coming more into the picture, even in-store.
It is not just retail that is utilizing digitalized payments, however. Digital business payments are also moving along, as well as mobile P2P payments and more. These changes are affecting the entire payments industry. Knowing the emerging alternatives to card payments can help you in finding the best options for you.
Also, e-commerce and mobile payments will continue to chip away at the share that in-store payments have. Most people still order goods from their desktop computers and laptops, but smart devices such as smartphones and tablets are gaining a larger percentage of the total payments share overall. With even more convenience in terms of making payments, it is easier than ever for consumers to purchase retail items, videos, apps, programs, services and more.
With the addition of new payment tools, such as wearables, voice assistance and even options to purchase things built into vehicles, the ease at which people can pay for goods is continuing to rise. Your business can benefit from the shifting roles and increased services many providers are offering.
Other Notable Trends in 2020
Companies are looking to create a customer experience that is practically invisible for consumers. By embedding software into applications and using other methods so customers do not need to input information to pay, invisible payment methods are now blending with other consumer experiences.
Businesses should also take note that for the first time, digital-first generations will hit their prime spending years. With hundreds of billions of dollars of spending power, new generations will account for a much higher percentage of global consumers. To keep up with the demands of this demographic, your company will need to innovate its use of payments and move towards becoming more accessible in the digital payments world.
Invoicing is another thing that is moving into the digital realm at a faster pace than ever before. While it is not new, with the increasing popularity of digital payments and other places throughout the payments ecosystem, people will start to use B2B digital invoicing much more.
Outside of domestic payments processing, cross-border payments and cross-border e-commerce are likely to continue to grow. This means more opportunities for your business to attract customers from all over the world, though becoming a global retailer is not easy and will require advice from payment pros.
Keep an Eye on Fraud
With many positives happening in payments ecosystems, it is important to note that increasing technology leads to both smarter fraudsters and smarter fraud prevention services. Make sure you have a fraud prevention program in place that will monitor the use of AI and use fraud prevention tools to analyze broad data to give more insight into business decisions. Working with companies that are not only aware of these, but successful in dealing with them, is essential.
With increasing regulations in terms of privacy and payments, such as GDPR and PSD2, as well as CCPA in California, moving to newer technology is essential. People are shifting to digital payments at a high rate, and businesses using outdated technology could see less profit overall.
Jonathan Corona has 15 years of experience in the electronic payments industry. As MobiusPay’s EVP, Corona is primarily responsible for day-to-day operations as well as reviewing and advising merchants on a multitude of compliance standards set forth by the card associations. MobiusPay specializes in merchant accounts in the U.S., EU and Asia. Follow them @MobiusPay on Twitter, Facebook and IG.