Payment Trends for 2020

Payment trends for 2020 seem to be extremely focused on consumers and in providing them with a convenient, safe and seamless experience. This will become a focal point to decide which strategies businesses will use and the payment methods they will implement.

1. User Experience

Payments are one of the leading figures in the trade and customer service scenario. Today, users want control, speed, convenience and security. Basically, payment processes should be seamless, giving consumers the power to pay as they want, whenever they want and from wherever they want.

A consequence of the increased use of internet for purchases of goods and services (especially from smartphones) and the reduction in the use of cash is that customers not only want to have multiple payment options at their disposal, but also expect them to be convenient and safe. Any business lacking these characteristics risks losing their relations and reducing customer preference.

2. Improvement in Security Systems

We are going through an era of innovation and fraudsters are not lagging behind. Accenture estimated that the banking industry lost around $31.3 billion dollars in 2018 due to credit card fraud.

Users are becoming increasingly aware of these criminals, so they choose brands and businesses that can provide them comfort and usability, in addition to protection for their information. Thus, businesses have the option to apply measures that range from tokenization, as Kushki does, to artificial intelligence for detecting and stopping fraud.

It is important to note that security is one of the most relevant trends for 2020 and for the future. Payment systems must be extremely practical but also safe, and having one feature must not imply sacrificing the other one.

3. Generation Z

The increasing need for speed in the implementation of changes for payment methods and for innovation emerges from a generation of consumers who grew using smartphones and digital technology.

Generation Z (Gen Z, born between 1996 and 2010) demands immediacy and efficiency in the services they acquire. According to Fast Company, by 2020 Gen Z will represent a 40% of the consumers in the United States, and according to Forbes, they have a $44 billion worth of purchasing power.

These numbers show us that, regardless of the business location, Gen Z is a considerable group of consumers that should be kept in mind, since they will determine which businesses will survive in the future and which will perish.

4. Increase in Mobile Payments

In the last few years, cell phones have become an essential part of our lives, to the point that many of us feel that it's impossible to function without them. They are not only our phones, we also use them as our music and video game players, our calculators, GPS, digital planners, our email managers, our libraries, clocks, alarms, etc. And soon, they will also become our digital wallets.

The introduction of APIs that enable the creation of utilities for our mobile phones makes it increasingly convenient and simple to pay things using them. Additionally, the use of apps such as Uber, Rappi, and Netflix have shown us how simple it can be to access services instantaneously.

For these reasons, many efforts are being made for improving users' payment experience through cell phones, making it more flexible, convenient and immediate. Banks are working on their mobile technology to offer their customers full control over their accounts through their apps. On the other hand, digital wallets created for saving all credit and debit card information, gift and loyalty cards are becoming increasingly popular.

5. Biometric Authentication

Because of the increase in digital payments and the use of technologies with access to our microphones, cameras, and fingerprint readers, the possibility of biometric authentication has become a reality. Thus, digital businesses are beginning to integrate tools ranging from fingerprint and voice recognition, to facial and iris recognition, which help in streamlining authentication processes while increasing the efficiency and security of the service.