The evolution of payment methods in recent years has revolutionized the way in which we carry out this type of operation. For this reason, Capgemini has decided to develop a trend report Over the payment models that are already breaking into 2022.
1. Next generation payment methods will drive growth
The sudden and sharp growth of digital credits is disrupting traditional systems as the adoption of next-generation payment methods proliferates. The health crisis highlighted the need to modernize payment systems in banks and companies, in addition to promoting the irreversible advance of contactless payment that will prevail in 2022 and beyond.
2. Digital identification will be key
The popularity of contactless payments among consumers grew during the pandemic, prompting the need for a robust digital identity infrastructure in the Payments 4.X era. The digital identity market is growing, enabling banks to regulate data usage, establish KYC (Know Your Client) features, fight fraud globally, and boost consumer confidence.
3. D2C and other innovative proposals boost SMEs
The demand for digitization of the SME sector, combined with emerging technologies, extensive alternative data sources and new credit models, are paving the way for other non-traditional entities to serve this underserved customer segment. It is estimated a increase in innovative offers based on data and smart analytics (for quick and easy credit approval) in 2022, which can help reduce defaults as supply chain financing options go digital.
4. The big technology companies enter the B2B segment
After a successful run with digital wallets in the P2P segment, large technology firms are looking to expand into more profitable segments such as businesses, SMEs and the B2B market. However, antitrust regulatory initiatives can hinder or prohibit the behavior of these companies in the sector, causing technology companies to limit their business to the distribution of financial products and emerge as B2B markets that do not compete with banks.
5. Costs and operational benefits drive open ecosystems
The payments industry is witnessing collaboration, as companies are interested in reaping benefits from the investments they have already made, moving towards industrializing their innovation. Open ecosystems are especially useful in low-profit environments because they offer a cost-effective way to meet consumer demand while using digital efficiency to streamline operations.
6. PAAS and API business models unlock new frontiers
To generate new revenue streams from financial and non-financial partnerships, banks and payment companies must create a strategy to leverage APIs and open banking. Banks must create foundations that offer the flexibility and agility to respond to the changing needs of corporate customers, reducing the costs of standardized, accurate and comprehensive payment data in real time.
7. Cybersecurity is essential
The rise of digital payment methods, fueled by the pandemic, is raising cybersecurity concerns, a key challenge for FIs and PSPs. By 2022, businesses are expected to implement a combination of digital identity, automation, and analytics to gain insights to reduce cyber risks and deliver value-added services to customers.
8. PayTechs focus on market expansion and M&AS on improving profitability
Credit is a gateway to the financial services market, but the profitability and sustainability of the business depend on expanding beyond payment functions. Therefore, newcomers such as PayTechs are becoming strategically diversifying to gain an advantage over traditional operators, offering a range of financial services beyond payments to act as a single portal for customer needs in various sectors. In 2022 and beyond, the payments industry will transform from a product to a customer experience (CX).
9. Expansion remains constant
Payments companies are taking the inorganic approach to expand the scale of their offerings and their geographic reach. As this expansion continues, payment companies could group together to offer a single portfolio of end-to-end services and provide a wide variety of value propositions.
10. The growing interest in digital currencies requires greater preparation for the future
Central banks are studying digital currencies as a possible solution to problems such as poor financial inclusion, money laundering and the increase in the circulation of unregulated cryptocurrencies. In addition to improving financial inclusion, other use cases such as profitable cross-border paymentss and the rationalization of commercial financial activity, may be potential results of the use of this digital credit.