The Future of Payments

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The financial world has seen a lot of changes and revolutions. The introduction of cryptocurrencies and digital money-sending alternatives means the future of payments could be very different from what we’re seeing today.

These changes haven’t gone unnoticed. Regulators are now changing their policies to adapt and take up these changes. Business owners must evolve to keep up with the agile global payments ecosystem. As it stands, things are going fast. It’s certain that how payments are sent, handled and processed could undergo even further changes in the future. So, what should you expect the future of payments to look like? Here are some predictions on the future of payments.

Near complete digitisation

More and more payments will head towards digitisation. Payment steps will be simplified as policies change, and the verification will be instant. If human verification is necessary, it will be seamless. The need to sign three times, fax and verify transmission will be a thing of the paper. Paper money will still be around, but its need will be significantly reduced.

At most levels, digital wallets and invisible payments will be evident in most levels of modern society and in most transactions and major operations. But still, physical cash will still exist in the foreseeable future.

Open Choice

Just a few years back, there were only a few methods of sending money and making payments. Customers didn’t have much of a choice. They only had to choose between banks and money-sending services like Western Union. But as it stands, there are dozens of money-sending apps and multiple ways to make payments.

Customers can now choose what payment method is best for them. They can choose from Tap, biometric, chip, send or scan. With a vast array of potential partnerships between firms and retailers, customers will be spoilt for choice.

Even better, corporations can choose the standard processing time or go for real-time processing. Banks as well will have new revenue streams from these choices. It’s a win-win for everyone in the fiscal market.

Blockchain and cryptocurrencies

Cryptocurrencies and blockchain have been around for some time now. You’ve possibly heard about them already, even though not everyone fully understands them yet.

Cryptocurrency is a decentralised digital currency not controlled by any government or institution. The blockchain, on the other hand, is the underlying technology that runs cryptocurrencies, so to speak. In simple terms, it is an effectively giant record-keeping network that securely validates the transfer of cryptocurrencies.  

Cryptocurrencies have become essential to the payment industry in a few short years. The appeal of a decentralised payment system has become quite apparent. With over 12,000 cryptocurrencies in existence and new coins entering the market each month, there’s no ignoring the continuing trend of cryptocurrency.

Currently, cryptocurrencies are seen as an investment opportunity because of their potential and because acceptance of crypt for regular transactions is limited.

But in the future, it is likely that you will see high street stores offering customers the opportunity to pay using their chosen cryptocurrency. Eventually, it could become more commonly accepted for day-to-day purchases.

Improved Financial Inclusion

Physical cash usage has created serious gaps in financial inclusion. As efforts to enhance financial inclusion are underway for businesses and individuals, the move towards digital payments could make it easier for these entities to access basic financial needs.

The direction in which payments are moving will ensure more people set up accounts with which they can use to send and receive money. More providers will diversify their reach in order to meet to help meet internationally agreed targets for inclusion.

It’s agreed that payment experiences need to go beyond the issuing of Visa and Mastercard. It should be more encompassing and tailored around the needs of each customer.

Freedom from geographical limitations

Most consumers who shop across borders are starting to experience this future now. With immediate access to funds and instant money-sending options, you can plan without worrying about shifting exchange rates. Knowing how much you’re spending and planning more accurately will be easier.

The differences in exchange rates and processing money the moment you need it will remove real or perceived barriers. Also, with more payment options that cover consumers outside the country, businesses can receive payments from all over the world and extend their services to people outside the country as well. This will enhance the business and customer experience as well.

Single validation, globally

Validation is one of the most frustrating processes of getting a card or approval for a new payment method. But that could change in the future. If you lose your card while on the road, all you might need to do is log into your account to get validated quickly. You can get access to a new card and your funds immediately.

Eventually, there could be one data point to validate identity and available funds to complete the payment regardless of where you are in the world. This advancement could make payments easier, faster and safer for individuals and businesses.

Transparency

Money is like electricity. You don’t care how it is supplied as long as it is safe and easy to access when you need it.

In the coming years, consumers will be more removed from the payment process. Payment processes will be shorter and faster. All you will need is to find what you want, hit accept and be on your way.

Real-time insight

Expect to see less “pending” on your statements and accounts. Eventually, consumers will get instant and up-to-date access to their accounts, funds and transaction status. This will help with budgeting and, for wealthy clients, an accurate view of their portfolio in real time.

Conclusion

It’s clear the future of payments is quite empowering for businesses and individuals. With the introduction of cryptocurrencies and digital payment methods, the future looks more decentralised and more about providing faster and easier payments for businesses and their customers.

It’s not likely that we will do away with physical cash. But as time passes, more and more people will not see the need to carry around physical cash, seeing that they can make most of their payments online, which will be safer and more convenient.

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