2020: 5 key digital payment trends
FinTech / 18.06.2020
2020 has been a turbulent year so far and it’s only June!
No one knows what the future of payments will hold for businesses in the post-pandemic landscape.
There are, however, some key digital payment trends that an increasing number of businesses are likely to see and encounter this year.
Curious to know what they are?
Keep reading below.
1. Mobile wallets
Mobile wallets have become a very popular method of making payments.
But what is a mobile wallet?
In simple terms, it’s a virtual wallet that enables you to link your payment card to your mobile phone, which in turn, allows you to make payments through your phone.
You can store card details through an app on your phone, make and receive payments, pay utility bills, earn rewards, purchase tickets and more.
Research indicates that the mobile wallet payment space is rapidly rising, with over two billion users in 2019 alone.
This space is worth watching in 2020 as big and small players enter the playing field.
2. The rise of codes
Europay, Mastercard and VISA, collectively known as EMV, have improved the technology behind card payments and bank transfers.
Whereas in the past transfers were made to random account numbers, now new EMV technology, which uses special codes as an added layer of security, are becoming the norm.
This shift will see a change in card usage, with the increased use of codes in the future to help prevent fraud and fraudulent transactions.
3. Biometric authentication
Biometric authentication is a method of payment which uses an individual’s unique structural and biological characteristics to identify them.
This can range from facial or iris recognition, heartbeat analysis, fingerprint scanners to vein mapping.
What’s more, this method has introduced new levels of security, accuracy and efficiency.
A highly secure payment method, it can go a long way towards building customer loyalty and trust.
It is definitely the way to go in terms of addressing fraud related to identity theft.
In fact, it is expected that biometric authentication payments will rise to over 18 billion transactions per year by 2021, so watch this space.
4. Contactless payments
By 2027, approximately 36% of all payments will be done contactlessly through near-field communication (NFC) chips on debit and credit cards.
This method of payment allows a customer to simply hover their contactless card over the card payment device, after which the transfer of funds takes place.
They are a much faster and more secure method of payment than Chip&PIN technology because they transfer encrypted data to the POS device immediately.
Furthermore, they’re a more hygienic and safer way of making payments and this is important during and post COviD-19 pandemic.
5. Mobile Point-of-Sale
In the recent past and near future, the mobile Point-of-Sale (or mPOS) market has been and continues to grow because it enables retailers to speed up the checkout process and reduce queues and lines.
All this while ensuring that they offer a more modern payment solution to their clientele.
But what is an mPOS device?
Essentially, it’s a smartphone, tablet or other wireless device that has been enabled to accept payments.
Although growing incrementally, the use of these types of devices is likely to increase in 2020 and through to 2021.
For example, research indicates that 3.2 million mPOS devices were used in 2014, while this number is expected to skyrocket to 27.2 million operational devices in the next few years before the end of the decade.
Trends, trends and even more trends
Digital, contactless and mobile payments, among others, are just some of the payment trends we’re likely to see develop further during the course of this year.
That’s why it’s a good idea to keep abreast of these developments so that your business can stay ahead.
With the ease of use of these increasingly popular payment methods, the customer journey is likely to improve with shorter queues and waiting times.
It will be worth your while to consider implementing some of these solutions in your business offering in order to help you improve your customers’ shopping experience.
Are you ready to try them?