Introduction
The payments landscape is changing rapidly. The traditional payment methods are being replaced by digital solutions, and customers are increasingly expecting a frictionless experience. In response, fintech companies have come to the forefront of the payment industry with innovative solutions that make transactions easier and more secure for everyone involved in the transaction cycle.
Payment adoption continues to increase
As the use of payment cards continues to grow, it is important to note that cash is still the dominant mode of payment in many countries. In 2017, there were 452 billion transactions involving cash worldwide–compared with just over 1 billion for mobile payments and just under 1 billion for contactless card payments (such as Apple Pay). However, these figures represent significant growth from 2014 when there were 375 billion transactions involving cash and only 6 million for mobile payments and contactless cards combined.
Fintech innovation has led to a decline in cash usage.
Cash is being replaced by digital payments. Cash usage has declined significantly in recent years, with the proportion of people who use cash for all or part of their transactions falling from 75% in 2012 to 54% in 2017. This trend is likely to continue as fintech innovations increasingly allow consumers and businesses alike to make payments via mobile apps, cryptocurrencies and other alternatives that don’t require physical currency.
Fintech is improving the customer experience.
Fintech is improving the customer experience.
Fintech companies are providing better services and making payments more secure, which has a direct impact on your customers’ satisfaction with you.
Payments are increasingly becoming digital.
Payments are increasingly becoming digital. The use of cash is decreasing, while the use of digital payments is increasing. Mobile devices have become an integral part of our lives, and they’re changing how we interact with money.
Digital payments have several advantages over traditional methods:
- They’re faster than cash or checks–you can make a payment in seconds without waiting for the transaction to be processed by a third party (e.g., bank).
- They’re more secure than cash or checks because they use encryption technology to protect customer information from being hacked by criminals who want access to your data so they can steal your identity and money.
Fintech companies have made significant contributions to the future of payments
The payments landscape is undergoing a transformation as it adapts to the demands of an increasingly digitized world. Fintech companies have made significant contributions to this evolution, introducing new products and services that are changing the way consumers pay.
Innovations in fintech can be divided into three categories:
- Payments – The use of digital assets for secure, fast and convenient transactions between parties
- Lending – Providing loans based on data from borrowers’ mobile phones or social media profiles
- Insurance – Offering insurance policies through mobile apps
Conclusion
As we’ve seen, the future of payments is bright. Fintech companies are innovating at a rapid pace, making it easier for consumers and businesses alike to pay each other. Payments are becoming more convenient, secure and efficient thanks to these innovations. In addition, fintech companies have made significant contributions to society by providing financial services that were previously unavailable or unaffordable for many people around the world.
