The first digital payments were processed way back in 1994, and in the past few years, there has been a considerable increase in the use of contactless payments as well as blockchain and crypto payments.
2024 will continue to see the expansion of digital payments, not only in the frequency and value of their use but also in the innovative technologies deployed in their use.
A Rise in Cryptocurrency Payment Options
Cryptocurrency was first launched in 2009 with the introduction of Bitcoin, although it took several years before it even started to get any widespread recognition. Even today, it is the less popular sibling to fiat currencies, but Bitcoin’s rise means that more and more people are taking notice.
Not only is Bitcoin accepted by some of the world’s biggest companies, but other cryptos are coming to the fore in different industries.
Crypto is popular for blockchain gaming and is now accepted by thousands of companies globally, while some of the best NZ online casinos not only accept but encourage the use of Bitcoin, Ethereum, Tether, Dogecoin, and other cryptocurrencies.
Gambling editor Sam Barnard says cryptocurrency is faster and cheaper than alternative payment methods, and for these reasons, it will continue its march through the digital payment sector.
Blockchain Technology will Reduce Retailer Fees
It costs New Zealand businesses approximately $1 billion a year to accept debit and credit card payments, which is a significant reduction in their profits. This comes even as financial institutions adopt blockchain, offering them lower-cost transactions.
However, as blockchain technology continues to be adopted across industries and companies come up with innovative new ways to offer its benefits to end users, merchants will be able to directly benefit from those reduced costs.
Payments and remittances made using blockchain can be completed in seconds and cost, in some cases, fractions of a cent. Not only is this beneficial as an alternative to card transaction fees, but it can also be beneficial to companies that accept orders from overseas.
Tokenization will Simplify Processes
Tokenization means that any asset can effectively be represented by a digital token. Details of the token are stored on a blockchain network, and because blockchain records cannot be altered or deleted, the record becomes irrefutable. The digital token can be transferred quickly and easily and with nominal fees.
Tokenization is becoming popular across a host of industries, including real estate, but it can also be used for cross-border, overseas digital payments that are completed faster and at lower costs than traditional payments.
In some cases, users may not even realize that the technology is underpinning payments they are sending, but it could lead to instant transfers around the world, especially as banks and financial institutions adopt blockchain technology.
Continued Rise in Contactless Payments
Contactless payments came into their own over the past few years. Maximum limits have been increased when using contactless, and this, along with the speed and convenience of these payments, has seen the technology’s popularity rise significantly.
That popularity will continue to increase in 2024, especially as convenient devices like mobile phone card readers become more readily available and cheaper for smaller merchants.
Biometric Technology will Reduce Transaction Times
Many of us are used to biometric technology on our devices. We use fingerprints and face scans to log onto our mobile phones, and some laptops and other devices use similar technology.
Digital wallets, including the likes of Apple Pay and Google Wallet, allow the use of this technology, and this will continue to become increasingly commonplace through 2024.
Increased Use of Voice Payments
Another form of biometric payment that will start to emerge is voice payments. Most people have smart speakers and voice-assisted devices, from televisions to thermostats and even lights. And voice payments are next.
Users will be able to make payments via their TV or speaker without having to use other devices to log onto payment screens. Initially, voice payments will likely be accompanied by some form of in-app verification, but even this will change over time.
Live Commerce will Spread
Live commerce is incredibly popular and has proven very successful in China already, although it has yet to hit the West in the same way.
Brands, or influencers, can host live streams, offering relevant content to viewers. Viewers can, at any time, click the one-click purchase button to buy the product that is being promoted.
It’s quick and convenient, and successful implementation of live commerce has shown significant sales growth for some Chinese businesses. It will likely make its way to the rest of the world via TikTok and other social media channels but will become increasingly popular with tech-forward companies.
Further Growth for QR Payments
QR codes can be added to posters, used in advertising, or put on videos, and the codes can essentially link to any URL, including a storefront, or directly to a payment page. They are also commonly used in cryptocurrency payments.
Although QR codes have never really taken off as expected when they first launched, when used well, they can offer convenience, which can help improve sales for businesses, influencers, and websites.
We will likely see QR payments continue to increase in popularity, along with the increase in cryptocurrency and instant payments
Cross Border Payments Will Be Easier… And Cheaper
Sending money overseas is easier than ever before, but using traditional methods, it can take days for payments to complete, and it can cost a fair portion of the payments sent.
Using blockchain, sending a payment to another person or business overseas is effectively the same as sending that payment to somebody in the same room as you. It takes the same time and attracts the same fees.
Blockchain payments don’t necessarily have to involve cryptocurrency, as banks are beginning to adopt blockchain technology themselves. Expect to see overseas payments become virtually frictionless in the coming months.
Embedded Payments Will Continue to Gain Traction
We live in a connected world where everything from our TVs to our cars are connected to the Internet. We can expect to see embedded payments rise as more and more devices become connected and take on smart features.
Mercedes has trialed a system whereby drivers can make purchases directly through their in-car system, and we are likely to start seeing this feature on everything from coffee machines to smart speakers.