The world of financial technologies does not stand still, delighting us with innovations in the field of payments and financial services. Read in my article what new payment methods may soon become as common as bank cards payments.
Instant payment system
Fast payment systems allow within a few seconds transfer money from the sender's account in one bank to the recipient's account in another, while ensuring interbank settlements. By the beginning of 2020, such services were operating in 56 countries around the world.
Fast money transfer systems have significantly changed the electronic payments market.
Payments with new smart devices
What are smart devices? These are bracelets, watches, rings, key chains, watch straps, through which you can also make contactless payments.
In 2020, according to experts, the market volume grew by 50% and in monetary terms amounted to approximately $ 69 billion.
Such devices have higher performance and more memory than the security elements used in conventional bank cards, they do support new cryptography and the latest protocols for remote content management of security elements with their full-scale implementation.
With the development of the payment function in IoT devices (Internet of things), users will have new opportunities for automatic payments, for example utilities, such us parking a car, payment for toll roads and other.
Remote payments are based on the Secure Remote Commerce (SRC) standard, recently renamed Click to Pay by EMVCo.
The SRC system itself identifies the buyer, selects the user's payment instruments registered in the system that are suitable for the store, and gives the buyer the opportunity to choose one of them.
Customer doesn’t need to fill in some client data, which simplifies the payment process.
The system initializes the operation using the tokenized data of the payment instrument selected by the buyer, ensuring a high level of security when making a payment.
Some low-risk transactions can be performed without authentication of the buyer by the issuer of his payment instrument.
Another interesting technology that can be used for remote payments is payments through instant messengers and chat bots.
Biometric data payments
These are payments using buyers' biometric data.
For example, this technology is used to activate the phone in many modern smartphones, as well as to confirm mobile payments. Usually a person needs to put his finger on the sensor on the device so that the system identifies it by the fingerprint pattern.
Such schemes for the use of biometric identification are also called bio enquiring. Payments with face recognition are convenient for the buyer: customer need only look into the terminal camera and confirm the payment.
Central Bank Digital Currencies (CBDCs)
Digital currencies of central banks are a reliable payment instrument, since the issuers of the CBDCs are obviously central banks, which guarantees their reliability.
Countries such as China, Sweden, Singapore, Cambodia have long begun experimenting with these projects.
For now, China has advanced further than other countries in the development of the CBDCs system, testing the digital yuan in a pilot project in several cities of the country with the participation of the largest financial institutions and fintech companies.
At the end of last year, Internet giant JD.com, which will accept digital yuan, joined the pilot project, and Huawei introduced the first smartphone to support this currency.
The US and EU countries are still only studying the issue of using digital dollars and euros.
Open API payments
The Open API is an open programming interface between service providers and banks that allows services to bank customers upon customer request.
So, the electronic payments market has undergone tremendous changes. The emergence of such new forms of payment is a revolution that made it possible new previously difficult and inconvenient payment services, which also led to lower costs, increased convenience and new opportunities for electronic payments.
What do you think about new forms of electronic payments? Share your opinion in the comments below! If you wanna learn more or know more you can contact my team or you can jump into a one-on-one call with me right now clicking one of the the below buttons.
He uses to dedicate part of his life to inspire others and help them achieve the most out of their lives. Since he was 20, he had successfully founded and managed several companies operating in the field of management consulting, wealth management and fintech. He is Member of Institute of Directors in London, Member of Changer Club in Riga, Member of Fintech Association of Hong Kong, Member of Singapore Fintech Association, Member of Non Executive Director Association in London and Member of Alumni Network of Draper University in San Francisco. He loves travelling, he is a cigars lover, an amateur golfer and a dapper man.
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