The future is like an oncoming train. You can see the light far, far in the distance. You hear the hoot, hoot miles off. It slowly but surely comes closer. The light gets bigger. The sounds become louder. Then. Before you know it. It hits you.
The future is now!
Digital currencies, online shopping, contactless payments, and frictionless customer experiences have been around for years. Covid confirmed it by accelerating trends already in place before the pandemic hit. It has catapulted the payment industry into an innovation phase where digital uptake happens faster than thought or time. Payment providers are iterating at record-breaking speed and digital innovations, driven by payment solutions, see the light every day. We’re sharing our insights of the top ten trends that we think will shape the future of payments in 2022 over a series of two blog posts. Here’s the first.
1. Platforms and Super Apps
Originating in China, super apps offer merchants and customers a one-stop-shop experience and destination platform that aggregate a broad set of lifestyle and financial services. These apps deliver added value by embedding payment capabilities. Users can transact without leaving the app. A shopping mall in the sky, if you will. Users can transact with the simple swipe or tap of a finger, delivering a frictionless shopping experience. WeChat in China offers users more than 500,000 mini-apps where they can order food, use ride-hailing services, book plane tickets or pay for goods and services, over and above the normal chat functionality. Watch this space in 2022. Uber is aspiring to become the west’s first super-app with Facebook and Reliance Jio short on their heels.
Key themes shaping online payments include the explosion of e-commerce, digital identities, and changes to the labour force. The pandemic accelerated the uptake of online shopping and marketplaces. According to the Boston Consulting Group, £3.7 trillion shifted from offline to online retail sales in the last two years. This growth is not limited or exclusive to B2C. Forrester forecasts that there will be a compound annual growth rate (CAGR) of 10% of business-to-business e-commerce over the next five years.
3. Online marketplaces
Online marketplaces account for more than 50% of ecommerce sales globally, according to J.P Morgan. The pandemic forced companies to find new ways of doing business. They’ve found the solution in developing online marketplaces. Customer experiences, supply chains, treasury and payments functionality have all been affected by online marketplaces. We expect this trend to continue growing in 2022. Have a look at some of the exciting new business opportunities and models online marketplaces open up to businesses here.
4. Digital identities
Digital identities drive seamless shopping experiences. The growth of e-commerce has accelerated the demand for fragmented identities to be unified into one seamless identity where individuals and businesses can transact securely and without friction across devices. Various developers, banks, apps, and payment solutions compete to satisfy the high demand for unified identities. 2022 will reveal who gets to market first.
5. Gig and creative economy
Forbes reports that the gig economy mushroomed in 2021 and predicts it to grow to £337 billion by 2023. Mastercard predicts that work-from-home and freelance workers will grow to occupy 50% of all workers in the next decade. Fintech is crucial in developing products for this market since their needs fall outside traditional models. 2022 will reveal if the traditional nine-to-five model of work remains the status quo, or if it will be replaced by the gig economy.
The creator economy monetises passion and individuality. Every individual has the potential to become a small business. Media platforms are currently retaining most of this sector. As specialised players emerge that can satisfy the unique needs of this market, future payment solutions will accommodate followers wanting to reward the people they watch and interact with daily. It could lead to evolving payment methods, tax calculation, and credit services. 2022 will tell.
Whether you run an ecommerce business or sell your services online as part of the gig economy, Truevo has a solution that will get you paid. Fast! We provide flexible payment solutions across multiple platforms in over 150 currencies. Get in touch with us to find out how we can help you do business better. 5