Europe Paytech Spotlight

Payments Sphere in 2022 – What the Industry Is Getting Excited About

At The Fintech Times, we’re constantly on the look for the latest and brightest ideas in fintech, and this often coincides with discovering the latest tech in payments. With this in mind, we spoke to two CEOs from paytech companies to find out what they were looking forward to the most in the payments world in 2022.

Speaking to Marius Galdikas, CEO at ConnectPay, and Mike Elliff, CEO at Tyl by NatWest, we heard about what they think are the most prominent disruptive forces going to impact the payments industry in the upcoming year.

Marius Galdikas, CEO, ConnectPay
Marius Galdikas, CEO, ConnectPay
Marius Galdikas, CEO at ConnectPay
  • Internet of Payments

“It is estimated that by 2025, there will likely be more than 27 billion Internet of Things (IoT) connections. The growing number of IoT devices is rapidly shaping the everyday habits of consumers, including the way they choose to pay. This led the financial world to coin a new term—Internet of Payments (IoP)—which refers to a phenomenon that enables payment processing over IoT devices, for example, smart home assistants, like Amazon Alexa, or smaller everyday accessories, such as Apple Watch. IoP is currently at a nascent stage, however, as the market is becoming more saturated with IoT-driven devices, payments market players need to develop a blueprint on how to take advantage of this disruptive force.

“The merge of IoT and payments brings consumers extraordinary convenience with reduced friction. As Open Banking enables third-party providers and fintechs take on the roles of IoP providers, this opens up an entirely new area for innovation. Also, IoT creates the opportunity for businesses to gather more data about the consumers, which will help to elevate user experiences.

  • BaaS continuing to thrive

Banking-as-a-Service (BaaS) allows embedding financial services into any company. This gave rise to a number of new market players, which took advantage of the Application Programming Interface (API) driven platforms to enter the financial services industry. The BaaS market, valued at $356.26billion in 2020, is now projected to reach $2299.26billion by 2028.

“BaaS enables companies to leverage market-tested infrastructure without the regulatory overhang, saving a significant amount of organisation’s resources. As the pandemic led many to redistribute their budget, outsourcing banking infrastructure became an even more appealing choice — leveraging banking-as-a-service enables them to direct more resources towards product innovation, rather than framework building. Therefore, BaaS providers will continue to fly high.

  • Hyper-personalisation

“The need for personalised experiences followed consumers to the online space. While process automation will remain one of the top priorities for fintechs, the key will be finding the balance between providing efficient service and not losing ‘the human touch’. To secure future success, industry experts have emphasised leveraging real-time consumer data to provide personally tailored insights and proactive advice.

“With practically every business pouring investments into upgrading their tech framework, hyper-personalisation becomes the main driver helping banking service providers differentiate from their competitors. That’s why refining their approach to be primarily customer-centric as well as proving it at scale will allow gaining a competitive edge.

  • Lasting focus on CBDCs

“Throughout the year, central bank digital currencies (CBDCs) have been gaining momentum, with countries all around the globe, such as Sweden, Norway, South Korea, China, and others pushing the rollout and testing their application in the real world. The interest in government-backed e-money is not wavering, rather the opposite, it spurred new ideas, such as launching multiple CBDC systems, that could potentially cut off billions of transaction fees annually.

CBDCs could provide a range of benefits, for example, lowering the cost of cross-border transactions, increasing financial inclusivity, and enhancing economic resilience of domestic payments systems. This is a tool that, if implemented thoroughly, could outweigh the offerings of payment service providers, which will have to immensely step up their game. As for the multiple CBDC network, the main question of ‘how long will it take?’ remains, as developing a united framework seems like a Herculean task, with each countries’ efforts moving at a different pace.

“The payments market is evolving as rapidly as ever, despite some of the challenges it had to face throughout 2021. The upcoming year is looking to bring more efficiency, personalisation, and tech synergy, fueling the sector’s growth even further.”

Mike Elliff, CEO at Tyl by NatWest
Mike Elliff, CEO at Tyl by NatWest
Mike Elliff, CEO at Tyl by NatWest
  • Payment improvements

“For 2022 it is increasingly important for the payments industry to view every move through its impact on the relationship between the business owner and the end customer, focusing on our customers’ customers. Not just the payment provider and the business customer. The rise of Open Banking and services such as Buy Now Pay later are an excellent example of this. For 2022 we expect to see businesses making decisions based on what their customers are asking of them to a greater degree than we have seen before. That is tied into the pandemic and its impact on the rise of digital payments in general.

“Choice is a great thing for customers but too much choice can also make things cluttered, especially when it comes to payment methods. For 2022 we expect to see a continued proliferation of payment method choices but the challenge for SMEs will be how to strike a balance between choice and simplicity.

  • SME demands

“The key question SMEs will ask themselves throughout 2022 is; ‘Does my payment provider make my life easier?’ Every feature, customer interaction and touchpoint must be designed with ease of use in mind. To that end, transparent pricing, flawless service, connectivity, speed of processing and the delivery of valuable insights that are easy to act on are key for SME owners in 2022.

“Interestingly, we’re also seeing SMEs place greater importance on aesthetics. While physical appearance should never mean compromising on quality or value for money, many merchants – particularly those in the events, beauty, retail and hospitality industry – are increasingly turning to payment providers who offer a device with a modern, fresh look that compliments the wider vision they have for their brand.

  • Supporting SMEs

“The payment industry can play a vital role in helping SMEs unlock data and improve decision making. As an industry, we’re sitting on so much information that can help SMEs understand what’s working for them and how their customers behave. This has been talked about for a while now but there is still so much to be done to fully unlock the size of the opportunity in practice. Ease of use should be the guiding star, providing clear insights in a few clicks. From a Tyl perspective, our breadth of customer base means that we have the potential to deliver phenomenally valuable insight across a wide range of sectors. Taking inspiration from outside the industry such as the iPhone health app, if you are able to bring useful, readily packaged insights to SME owners through unprompted notifications, taking all the responsibility off the busy SME owner, you will drive behaviour shifts with customers craving the knowledge they have never had before, provided by your system, without them having to think.

  • SME concerns

“While lockdowns remain a key concern among SMEs, business owners have developed incredible resilience over the last two years and are hopefully feeling more optimistic than they were heading into 2022. However, consumer habits have changed significantly since pre-Covid and customer expectations have seen a marked increase. A key concern for SMEs therefore is how they can make every interaction with customers flawless. It’s not just about the product and service you’re selling if you want to secure long term loyalty. The payment process is a key component of the quality of the overarching shopping experience, helping SMEs bring their customers back time after time at a point where businesses need that more than ever.”


  • Francis is a journalist and our lead LatAm correspondent, with a BA in Classical Civilization, he has a specialist interest in North and South America.

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