Payments: Evolution and Future

Payment methods, payment processing, and the payment service industry in general will be shaped by five key macro trends and developments in the future and are already doing so.

On the one hand, payment services should become more inclusive, i.e., consumers and merchants should be given broader access to payment services nationally and internationally. On the other hand, digital and cryptocurrencies are becoming increasingly important.

Furthermore, digital wallets are becoming increasingly popular and widespread, with their benefits being further enhanced by mobile and QR code payments, apps, and open banking. In relation with the three trends mentioned so far, cross-border payments will be characterized by inclusive access to payment systems, global payment standardization, and global solutions based on cryptocurrencies and digital wallets.

However, these positive developments for consumers and merchants also have downsides in the form of financial crime. The degree of professionalization up to organized fraud-as-a-service requires the holistic protection of payment ecosystems.

In general, payment services have undergone major changes in terms of form and focus. Initially still a non-differentiated function, payments increasingly developed into a focus of differentiation and innovation – driven, among other things, by Open Banking and the Payment Services Directive 2 (PDS2).

In the so-called Payments 4.0 era, payments and payment services are customer experience-oriented. They should be embedded, invisible, and frictionless. Customers increasingly prefer personalized, digital payment methods, particularly, because mobile and online commerce (e-/m-commerce) are becoming the dominant shopping channels.
This means that companies need to offer user-friendly interfaces that integrate multiple digital payment methods and lay the foundation for cloud-, API- and platform-based real-time payments to optimize the customer experience.

Fact Sheet Payment Evolution

Capgemini Research Institute (2022). World Payment Report 2021.
PwC (2022). Navigating the payments matrix. Charting a course amid evolution and revolution. Payments 2025 & beyond.

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