5 TRENDS IN THE FUTURE OF PAYMENT PROCESSING SOLUTIONS

5 TRENDS IN THE FUTURE OF PAYMENT PROCESSING SOLUTIONS

5 TRENDS IN THE FUTURE OF PAYMENT PROCESSING SOLUTIONS

There is no denying in the fact that technology has taken over the world with a huge storm. A significant fragment of the world economy is directly or indirectly reliant on technology. With such level of automation, the rate of economic development is certainly to rise up. A wide proportion of service sector is IT dependent. B2B and B2C models have taken over conventional trading means. The infrastructure around activities ancillary to e-trading such as logistics and payment processing solutions has also led to the growth of numerous businesses.

All this has to be facilitated by a robust IT infrastructure, skilled personnel working at the backend and frontend, and a public friendly interface. Furthermore, the method of settlement of the transaction is crucial in online trading. Payment processing solutions in this context come into the picture. Different world economies have different trends in payment while making online transactions.

In the US where the economy is predominantly credit based, credit card payment processing methods are the most popular. Electronic wallets, however, have gained a wide popularity. They have already gone far in the development of requisite infrastructure for reliable payment processing solutions.
Going with some other developing countries, trends in payment processing solutions have begun to change in the past decade owing to decreasing dependence on cash on delivery models. People are turning towards e-wallets, credit cards while debit card transactions are already pretty popular.

Here are a couple of aspects that affects the trends in payment processing solutions

  • Acceptance of mobile payments
  • Security aspects
  • Gradual shift from conventional means to e-wallets
  • Infrastructure upgradation
  • Expanding collaboration between financial and non-financial organizations

Acceptance of mobile payments
Acceptance of mobile payments

In recent times, there appears to be wide acceptance of mobile payment technology among younger demographics across the globe. Also, certain types of transactions require mobile payment technology (P2P). Those providing such payment processing solutions forecast consumer demands for the next one or two decades, keeping in mind widespread growth in computer literacy among young individuals.

Smartphones are getting affordable and with cheap data rates, young population is having access to uninterrupted mobile internet services. Another reason for its widespread acceptance is open banking and numerous incentive schemes and rewards provided by API for mobile payment processing solutions. The convenience mobile payment processing solutions provide ads to one of the reasons for its widespread acceptance.

Security Aspects
SECURITY ASPECTS

One of the greatest challenges that have to be faced by companies associated with providing mobile payment processing solutions is the security of the transaction. There are still people who are reluctant to switch from conventional cash means to this form owing largely to lack of trust on the security of the transaction. There is a long way to go for building up consumer reliability.

Despite all this, advancement in biometrics and other security features paves way for facial recognition and fingerprint ID authentication. The future of payment processing solutions is highly secured in the hands of biometric security and other means such as one time passwords reducing risks of password crackdowns, hacking and fraudulent fund transfer.

Gradual shift from conventional means to e-wallets

Time and time customer experience in online trading and services is getting better. From food to anything as big as a car, everything is available at the click of a mouse. Such experience compels to millennial to freely share their private information including bank account credentials with the third parties. This largely facilitates better payment processing solutions.

As per statistics from a reliable source, the top 3 methods of payment of online shoppers are credit cards, e-payment and debit cards with e-payments making as substantial as 39% of total payments approximately. This is a credible sign of increasing shift towards electronic wallets paving way for increased automation.

Infrastructure Upgradation

One of the biggest challenges to be faced by changing trends in payment processing solutions is the infrastructure and technological upgradation. Technologies are dynamic and modifications take place quickly. Furthermore increasing the risk of frauds and theft compels corporates to maintain a robust infrastructure for secure payment processing solutions and gateways.

Old and existing infrastructure was not designed for real-time, digital payment processing solutions. API integration and modern fraud detection means were not provided for. Replacing outdated payment infrastructure will take time and financial outlay.

Expanding collaboration between financial and non-financial organizations

Banks and financial technologies have a greater role to play in the future of payment processing solutions. A planned coordination between e-commerce, fintechs, and banks will facilitate reliable trading and provision of service.

Collaboration between financial and non-financial organizations will boost up the economy by providing attractive credit facilities to consumers.

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