From year to year, new trends and advancements in technology help expand the growth of payments. There has been a vast improvement of payment solutions, which are able to process payments faster and possess heightened security features that help protect against breaches and instances of fraud. Throughout 2017, there will be many new options consumers and merchants alike will be able to choose from.
As the New Year begins, let’s focus on the top 5 payment trends that are expected to develop in 2017 and lead the way:
- Growth of Security Solutions
When it comes to payments, having heightened security features is essential to prevent potential threats and breaches. Nowadays, credit card data can become compromised in a variety of different ways. Since instances of fraud and data breaches are a continued problem, 2017 is expected to be a year where security solutions will continue to grow and additional security features will become available.
Now that EMV technology has been around in the U.S. for a little over a year, EMV adoption is expected to continue expanding in usage, as more payments players and merchants begin to integrate EMV-capable solutions. The longer merchants wait to integrate EMV solutions, the more likely they could open themselves up to fraudulent cards being used and experience an increase of chargebacks.
Other options for increased security protection include encryption and tokenization, which keep credit card information safe from potential hackers. These two technologies transfigure credit card data into unreadable code upon being swiped. Data is then tokenized, making the information only accessible via a secure token. Together, they reduce risk and liability associated with payment transactions.
Within the next year, we can expect for security solutions to expand and bring on additional features that will help protect all forms of payments.
- Mobile Payment Acceptance Expands
Mobile payments are expected to expand in acceptance throughout 2017. During 2016, consumers expressed an interest in using mobile point-of-sale (mPOS) payment methods to purchase items. With this trend continuing to expand, more merchants, especially those not in a brick-and-mortar location, are considering integrating mPOS solutions in 2017, as they are easily accessible, convenient, and reasonably priced to buy. mPOS solutions are a great option for merchants since they are able to accept payments outside of a traditional POS system, allowing them to be flexible and take their payment acceptance solution on the go.
Consumers have also shown an interest in using mobile wallets and apps. With Apple Pay®, Android Pay, and Samsung Pay leading the way for mobile wallets, many consumers have begun using their smartphone devices for payments and adapting alternative payment methods.
On a similar note, mobile applications are expected to continue rising in popularity. Like mobile wallets, mobile apps store and process credit card information, making it a quick and easy to process a payment via a smartphone device. Many restaurants and retail stores are coming out with their own mobile app so that consumers can buy products on their own time in advance without having to wait in line. For instance, Starbucks has introduced a feature in their popular mobile app that allows consumers to order items in advance on their smartphones, which are ready to pick up upon arrival without having to wait in line.
- Shift Towards Cashless Payments
2017 will be an important year for cash and whether it will remain a predominant form of payment. With more and more consumers using their smart devices to make purchases and websites becoming more mobile-friendly, consumers are shifting toward favoring digital payments over traditional cash. In fact, experts predict that around 75% of transactions will be cashless by 2025 and Global Mobile Money reported that 66% of consumers have used their mobile device to process a payment transaction.
On top of that, consumers view mobile wallets and apps to be a faster and easier form of payment. All that is needed to unlock a mobile wallet or app is a quick press of a button or fingerprint scan, making it a quicker process than having to dig through a wallet to pull out cash.
- Progression of Payment Technology
There are two forms of technology that have shown growth regarding payments – NFC and Bluetooth. NFC (Near Field Communication) technology processes mobile wallet payments and is also used at ticketing booths, vending machines, and payment kiosks to process payments. With payments becoming more digital, NFC technology is a prime example of a software that is expected to progress. In fact, payment experts predict that the NFC market will grow to $47.43 billion by 2024.
Since Apple removed the headphone jack feature from their latest iPhone 7 smartphones, millions of consumers will now have to rely on Bluetooth technology for many features, including wireless headphones that connect via Bluetooth. As more consumers begin to adopt Bluetooth, there will be an advantage within the mobile spectrum to include more products and solutions that integrate with Bluetooth technology. Google has already begun testing a new mobile payment app called Hands Free, which uses Bluetooth or Wi-Fi to connect to a users smartphone for payment, allowing the user to remain “hands free” during the purchase.
Even automotive companies and businesses are diving into the payments industry. As of late, several companies are in the works of developing mobile payment apps and solutions to pay at parking garages and meters. There is also the opportunity in the near future for a solution that will allow consumers to purchase food orders and fuel from their car’s dashboard.
- Growth of Integrated Payments
Integrated payments are a seamless and cost-effective way to combine a broad spectrum of business applications with payment processing. Not only do integrated payments save money and improve cash flow, but provide a comprehensive suite of payment solutions that add value to a merchant’s business software. With integrated payments, merchants can take advantage of products such as recurring payments, an account updater product that automatically updates credit card information, and virtual terminal. Likewise, integrated payments help make the payment process seamless. With just a snippet of code, ISVs can easily integrate various payment functionalities into their software.
2017 will be a prime year for new payment technologies and trends to emerge and make a difference. The growth of security solutions will provide merchants added protection against threats while mobile payment acceptance is expected to continue expanding in usage. The shift to cashless payments is a possibility as well, with digital payments becoming more prominent. Likewise, progression of payment technology and integrated payments will surely make a difference throughout the year. Here’s to 2017 and the future of payments.