Excerpt: Merchant processors like Platinum Payment Systems are expecting to accommodate the quickly transforming merchant payment processing landscape.
The merchant payment processing industry was not exempt from the digital transformation that took the world by storm during the pandemic.
And this is corroborated by Jed Morley, CEO and founder of the merchant processing company, Platinum Payment Systems, who, in an interview about how they are planning to level up their business for 2021, said, “We’ve had to adapt to the major economic shifts and uncertainty caused by COVID-19.”
Suffice to say, the payment processing industry will be forever changed by the incoming trends that we can expect from 2021 and beyond.
Catch up with the latest payment trends with us as we take a peek at the future of consumerism waiting for us just beyond this swiftly changing economy!
1. Mobile Payments
Mobile Payments have been around for more than half a decade now. And, ever since Apple first launched their mobile wallet technology, it’s been a slowly rising trend all over the world.
China, especially, accepted the transition away from paper currency and onto digital platforms faster than everyone else. They went from a $5.5 trillion industry in 2016 to $41 trillion (or 277 trillion yuan) in 2020 — with their most popular mobile payment platforms being Alipay and WeChat Pay.
The US is a little bit slower on the uptake, but because of COVID-19 and the social distancing mandates, a no-touch payment option like Apple Pay or the ones offered by other big brands like Google or Samsung was seen as more preferable over cash currency, triggering an uptick in the mobile payments industry. With the expected predictions for 2023 now at $220 billion!
2. Frictionless Payments
Frictionless payment processing is also expected to see a dramatic rise in popularity for the years moving forward — mainly as an extension of the need for no-touch payment solutions.
But, it’s also the kind of streamlined customer checkout process that consumers are looking for these days. Done by cutting up the time or the number of steps it takes to actually complete a purchase. Mobile payments fall into this category, and so do one-click payments, auto-renew subscriptions, contactless card payments, and other ‘invisible’ real-time payment methods.
The trend was confirmed by the Futurist Group, who released a recent study that reported that over 38% of consumers now expect frictionless payments as a basic feature of payment processing.
3. AI-based Integrations
Just like with most technology-based industries, merchant processors like Platinum Payment Systems also stand to benefit from integrating Artificial Intelligence (AI) and machine learning (ML) into their processes. Not just for streamlining the checkout process, but also for things like:
- Fraud-detection, especially for high-risk credit card transactions
- Smoother and lower-cost customer service
- Insights on chargebacks, fraud, and transaction success rates
4. Buy Now & Pay Later
With the unstable economy being the way it is, and so many people facing unemployment or reduced wages, it is also only natural that people begin to make use of the ‘Pay Later’ options that have always been popular with the Millennials and Generation Z.
These are an especially attractive option for merchants who want to move inventory that take up space with no added cost, or those who sell high-ticket items that buyers are naturally more hesitant to buy. Because, in the end, they still get paid the full price of the product after a series of payment installments — which they can accept with services like AfterPay or Sezzle.
With digital payments becoming more popular in general, it’s also only natural that peer-to-peer payment options that allow consumers to easily split checks to now have their place.
It’s not quite as popular as other merchant payment processing trends because of the lack of larger-scale technology to support the high-processing rates of most merchants, but with peer-to-peer payment app services like Venmo and Zelle already in the market, experts expect that consumers will begin to seek such services from merchants soon as well. Even if it’s not immediately obvious.