The global payments landscape has undergone many changes since the pandemic, due to shifting consumer needs and advancements to technology, like artificial intelligence (AI). Today’s consumers expect continual improvements to products and services, as well as greater convenience and personalisation. Chris Dahl, Co-CEO, Pin Payments unpacks the latest trends.

As technology and AI take centre stage in 2024, the payments landscape is likely to see many changes that will impact businesses. So, how can you prepare? Here are a few predictions for the top payment trends  ahead.

Six payments trends reshaping the landscape

1. Increased adoption of digital wallets

With mobile wallet transactions skyrocketing to $93 billion in 2023, Australians are increasingly leaving their wallets at home in favour of tap-to-pay, according to the Australian Banking Association. With mobile wallets seeing a 760 per cent increase since 2018, tap-to-pay is set to soon replace cards as a primary method of payment. With legislation soon to be implemented to regulate digital payments like wallets, cash could be an outdated currency. Likewise, 2024 will see more small businesses implementing payment infrastructure to accept contactless payments.

2. Stabilisation and expansion of BNPL

The buy now, pay later services have experienced several peaks and troughs over the past few years, with an initial surge during the pandemic followed by a decline in profit margins. With the BNPL market stabilising at present, major players are looking to expand their customer base, outside of the previous Gen Z target, and create new areas and financial products. With huge growth predicted for the sector globally, it’s likely BNPL services will appear in more physical stores, as BNPL companies look to create a convergence of physical and digital offerings. Despite this, with recent global staff layoffs in the BNPL industry, the future of the industry is still in question.

3. Advancement of biometric payments

Biometric authentication is already revolutionising identity verification in the payments landscape. Tools like facial recognition and fingerprint scanning offer secure and convenient ways to confirm a user’s identity. However, AI is set to unlock the full potential of biometrics by improving the accuracy of identity detection making it harder to impersonate someone online. This tech has huge potential for online payments and fraud prevention, hypothetically creating a near-impenetrable barrier against identity theft.

4. Greater cybersecurity protocols and tech

The cyber breaches of 2023 have highlighted the importance of increased protocols in finance to ensure customer data is protected. Areas for improvement this year include, the implementation of advanced algorithms to analyse datasets to identify potential threats and increased cybersecurity automation to improve security monitoring and incident response. Financial institutions may also look to improve predictive analytics, behaviour analysis and real time risk assessments.

5. A demand for increased personalisation

Advanced personalisation is a key trend across many products and services in 2024, as user’s begin to understand technology’s true ability to offer a tailored experience. AI is one of the biggest disruptors in this space and fintechs are utilising this tech to analyse user behaviours and trends. In doing so, financial institutions will be able to enhance payment methods, automate regular payment timetables, and embed sophisticated tools into payment platforms. Likewise, advanced tech will also have the capacity to suggest transaction modes based on the user’s present location, the device in use, or past payment activities. Chatbots and virtual assistants will also receive a major upgrade with the capacity to handle more challenging inquiries.

6. Shift towards real-time bank account payments

Our millennium-long reliance on paper currency could be nearing its end with the introduction of real-time bank account payments, a digital solution that offers instantaneous transactions for purchases. For businesses this means they’re able to access funds faster, it reduces the costs of payments online and securely sends funds from one bank account to another. The widespread implementation of this payments infrastructure globally may mean all fintechs, even startups, could offer consumers the same fast, secure and immediate transfer of funds, not just larger financial institutions. The benefits of real-time bank account payments, if implemented globally, would be major and could create greater financial equality for fintech businesses while benefiting consumers.

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