Currently, one of the most active areas of innovation in the banking industry is the payment industry. Digitization of payments made it easier to achieve fast, secure, and convenient ways of making payments and transactions.
The digital payment channels are growing robustly as the dynamic
payment ecosystem is evolving and expanding. The payment industry has seen many
exciting trends in the last few years.
According to the data collected from Bank for international settlements (BIS), it was evident that there was a 55% increase in digital payments in India in the last year. Cashless payments or digital payments are gradually becoming a way of transaction, which are increased by Unified Payment Interface (UPI).
UPI undoubtedly emerged as a primary payment option in recent
times for Indians. The invention of UPI enabled bank services to be more accessible
to a broader audience group by diminishing the difficulties of traditional
payment methods like RTGS and NEFT. UPI enables people to send and receive
money solely by relying on a virtual address or a UPI Id.
The innovations in Digital Payments
According to industry experts, the following are the recent
innovations in the digital payment industry that will dominate the
future.
Using biometric technology has almost eliminated the need of remembering a PIN or password to access devices. Being able to authorize digital payment platforms like Google pay, Apple Pay and others using biometric authentication has made the entire payment process hassle-free by providing customers with a user-friendly experience.
Biometric technology comes with many interesting features and
provides benefits such as security, ease, speed and accuracy. According to
industry experts, PIN usage fades way in the future, while bio-metrics, voice,
and other factors will be used to identify the user’s authenticity.
Most payment technologies work with mobile phones, but Face recognition technology is designed to enable payments without using mobile phones. For this, customers need to stand in front of the Point of Sale (POS) machine, which will be equipped with a camera that captures the consumer’s image and then transfers the payment. This is a rapid and hassle-free method of transactions.
Invisible payments allow consumers to make transactions without
any human intervention at the time of availing these services. Consumers are
charged when using this service within the prescribed limit or using a
particular service with prior agreement and consent.
Invisible payments are seamless transactions that automatically
allow customers to pay through apps and other methods by eliminating the
checkout process. These payments are shaping a way to provide frictionless
payment experiences to customers.
Tap-and-go payments are considered to be much secure and faster
rather than dipping a card. They are also referred to as contactless cards.
These contactless credit and debit cards make use of a combination of
contactless chips and RFID antenna along with EMV chips for the transactions to
be processed.
The primary purpose of tap-and-go payments is to speed up the
payment process without consuming pin-code and authorization process. There is
a steady growth in Tap-and-go payments in India.
Many financial institutions are considering making voice
payments the next big thing. Few institutions are already using voice
technology through bots and serving the customers.
The exact process will be applied to transfer the payments. Many digital payment platforms like Google pay, Apple pay, and Amazon pay are in the process of using the voice payment method. This method is going to be the upcoming trend In future due to its seamless and hassle-free technology.
Many financial institutions worldwide are switching to faster
payment methods, and the innovations mentioned above are considered to rule the
payment industry in the next decade.
Conclusion
Financial institutions should consider changing regulations and
advancing their technology to grow and compete among stiff competitors. Regular
innovations of digital payment technology should be given utmost importance to
be a key global player in transaction processing and payment technology. Latest
technologies like Artificial Intelligence (AI), Machine Learning (ML) and
others should be leveraged and applied to the digital payment space to avail
latest innovations.
This content was originally published here.