What’s Next for Digital Payments in 2022
Although disruptive, the pandemic provided a unique opportunity for organizations to reassess their current business models and improve on their digital payment efforts. This payment eco-system continues to rapidly evolve and 2022 is expected to bring acceleration in the payments industry that will truly impact merchants and consumers alike.
Here are some new payments trends to watch for in 2022:
1. Proximity No Longer a Barrier Nor Advantage
The reality of the digital shift is that consumers are no longer constrained by how far away something is. Consumers are shopping more online for retail products – some 30 percent of them, according to a recent study, and takeout from restaurants for delivery at home has gone from 66% to 75% since June 2021. And many more products and services are headed in this direction as technology is making once-physical interactions turn into immersive digital experiences.
For merchants, this is both a threat and an opportunity and those who wish to make it a competitive advantage now must one-up the digital alternatives that consumers find easier, more convenient, and less wasteful of their precious time.
2. Logistics Become Key Ingredient for Economy Winners
The woes and triumphs of the logistics industry continue to dominate the headlines. And these supply issues go beyond just moving goods from one physical location to another. The supply chain also represents the enabling of the movement of money, information, products, and services between endpoints.
For merchants to meet customer needs, it will require a single infrastructure that allows companies to move at the speed of the consumer – fast, slow, or somewhere in between – and orchestrates those experiences in a way that improves the lifetime value of the customers they serve and the economics of the businesses they operate. Mastering this core capability will produce an environment where merchants win and so do their customers.
3. Real-Time Payments May Overcome Debit Transactions
Consumers are now more aware of real-time payments and want to receive more of their payments that way and senders have listened. A recent study shows that three times as many consumers received instant payments in 2021 as they did in 2020 – and that a third of consumers who receive disbursements want more instant payments directly to their bank accounts, and are willing to pay to receive money that way.
As real-time payment use and adoption grows by consumers and businesses, its account-to-account instant payments capability could become an alternative to the debit cards.
4. Cloud Check-Out Will Compete with Traditional Payments
Merchants have spent billions to make the digital payments experience better, slicker, and more invisible to consumers. The pandemic sent the digital checkout experiences into overdrive and consumers do not want to go back into the stores and experience the same thing they have for decades – waiting in a queue before walking up to the register to checkout.
Even though merchants have improved the process with contactless and touchless payment options, consumers want better. Merchants will respond by moving to cloud-based POS experiences that outsource checkout to the consumer. Cloud-based POS systems also give merchants more of an opportunity to introduce new payment methods at checkout, whether it be their own branded payments methods or those provided by third party apps wallets. Either or both is made possible via a virtual card provisioned to their mobile wallet instantly.
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