The Future Of Digital Payments

February 21, 2024

Research from NCR Voyix and PYMNTS intelligence recently revealed that 27% of small businesses still rely on traditional payment methods such as checks. According to Jill Capicchioni, product director, payments at NCR Voyix, there is an opportunity for businesses of all sizes to continue moving away from checks and embrace other payment methods, and education and awareness about the benefits and risks of different payment methods are key to make this change happen – something that fintechs, as trusted advisors to businesses, can -and should- do.

The form and function of payments are just the tip of the iceberg – advanced payments technologies are also redrawing the underlying concept of transacting.

I’m surprised by how many small businesses now will take a card payment (…) When I have a contractor in my house and I ask them how they want to be paid and they tell me I can pay with my credit card, I get pretty excited.

Fees apply, of course, but businesses are starting to realize the benefits of having the payments go directly to them by card outweighs any fees they might incur by making use of the technology.

8 in 10 Gen Z and millennials are rapidly adopting digital wallets and other contactless alternatives, making it clear that these payments are only growing in popularity, and it’s no wonder why, when these digital payments are more convenient and secure.

According to Capicchioni, it is imperative for financial institutions to adapt quickly to embrace digital payments and educate clients to “bridge the gap” between digital and traditional payment methods.

(…) Aside from the security, convenience and ability to meet consumer expectations that digital payments offer, they separately create valuable, data-rich payment environments that can be mined for greater insights that support better products and payment experiences.

The future of payments lie on data, for which technologies such as artificial intelligence (AI) would be incredibly beneficial, especially for tailoring digital payment solutions to “meet evolving consumer needs and preferences.”

The opportunity with data and AI is huge … And as it relates to money movement in general, there’s a huge opportunity where that data and predictive analytics can be used to educate the business customer or consumer on potential future cash flow problems.

Capicchioni went on to add that data analysis and AI can be used to support and monitor spending habits, and offer “personalized recommendations on bill payments”, as well as helping financial institutions mitigate fraud risks.

Real-time payments are rife with fraud risks due to its very nature, and data analysis can play a huge role in making it an emerging market that can benefit all.

Want to learn more? Check out PYMNT’s full write-up here.

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