This month The Fintech Times is exploring paytech, meaning any technological innovation that changes the way we pay. As innovation continues to change the face of payments, we ask how close we can get to the ‘perfect payment’. Will innovation ever come to an end?
Whether we will ever see a ‘perfect payment’ is very much up for debate. Will digital payments ever reach a point of being as seamless and secure as will ever be possible? What would the perfect payment actually look like?
For Mike Smith, director of Business Expert, innovation will never come to an end: “The concept of a ‘perfect payment’ may vary among individuals and businesses but generally entails instant, fee-free, secure, and universally accepted transactions.
“While innovation in the payment sector continues to move towards this ideal, the diverse and evolving nature of global commerce suggests that there will always be room for improvement and adaptation to emerging needs and technologies.”
We reached out to some leading experts in payments to get their thoughts on the topic.
Work to be done
Steve Naudé, head of Wise Platform, explained how it is striving to get as close to the most seamless cross-border payments as possible: “At Wise, we believe that all international payments should be as easy as sending an email. This means, instant, convenient, low-cost, and effortless.
“The easiest place for a customer to make an international payment is where they are already managing their money, which is usually with a bank.
“But this is where the industry will go further – embedding payments in more places to solve the specific use cases and needs of customers at that point. For example, the ability to pay bills all over the world directly from your accounting software. Or to send money to friends globally via messaging apps. Wise Platform supports partners on these use cases, to enable better customer experiences and help partners increase revenue.
“There is a way to go until instant cross-border payments become the global standard, but it’s possible. We can get there through cross-collaboration between global financial institutions and fintechs and by the industry aiming for achieving the same speed, costs, and convenience that domestic payments offer.”
‘Innovation in payments will never come to an end’
Brad Hyett is the CEO of Phos, the software point of sale (SoftPoS) business enabling legacy technology providers and financial institutions to quickly bring ‘Tap to Pay’ solutions to market. He explains: “Innovation in payments will never come to an end.
“Emerging trends such as dynamic currency options and biometric authentication highlight the ongoing drive for improvement. Businesses are incentivising customers with loyalty schemes and value-added features, while mobile payments, led by Apple Pay and Google Pay, are gaining traction for their emphasis on convenience and security.
“I expect the expansion of payment acceptance points to continue to be simplified by innovations like SoftPoS technology, which reduces traditional hardware costs, while regulatory changes like MPOC certification will prompt further adaptation and innovation.
“The payment technology landscape is evolving rapidly, and based on the emerging trends, consumer preferences, and technological advancements dominating the space, we can expect innovations to continue providing more convenient, secure and flexible payment solutions to both businesses and consumers.”
Every payment method has ‘advantages and limitations’
Bruno Natoli, CEO of Mia-FinTech, suggests that differing needs across the globe means there can never be one ‘perfect payment’: “Payment methods, whether traditional or digital, each have their advantages and limitations.
“What might be considered a perfect payment for one person or situation may not be ideal for another, so it’s important to offer all of the options, and this is becoming increasingly easy to integrate.
“Payment solutions must demonstrate that they can provide bilateral security for both payer and payee and be robust enough to settle copious amounts of transactions as quickly as possible on a 24/7 basis. Money makes the world go around, and payment solutions must be capable of meeting the surging demand of their transacting customers.”
The ‘endless pursuit of optimising factors’
The thoughts of Patrik Backman, general partner at OpenOcean, also appears to mirror this take: “There is no single ‘perfect payment’ given the dynamic nature of technology and consumer demands.
“Contactless payments have largely displaced cash in some countries, while cash remains prevalent in the German market. Mobile wallets have now replaced traditional payment cards for many transactions in Asian markets. Emerging payment flows like BNPL, P2P, and cryptocurrency rose to prominence based on the demand for more flexibility. And biometric authentication methods have enhanced security and convenience for digital payments.
“This endless pursuit of optimising factors like speed, cost, security, and convenience across payment platforms is keeping innovation moving forward. As long as technology continues advancing rapidly, and consumer preferences keep changing unpredictably, payment innovation will continue striving for improvements. For instance, software point-of-sale (SoftPOS) solutions are disrupting traditional POS systems by turning mobile devices into payment terminals.
“While a definitive, static endpoint may never be reached, this cycle of constant improvement is a positive one – it benefits businesses and consumers alike. There is always room for new players to innovate and find better ways to facilitate payments.”