Customers’ behavior and expectations have radically affected the way they carry out the payments
Global head of ING’s Payments Centre Eric Tak named seven payment trends of 2020.
- Contactless card payments
They are currently representing more than half of ING payments in the Netherlands which are set to jump in 2020. The main advantage of that payment method is that it eliminates the need to enter their pin code at the terminal, allowing users to leave the card at home.
- Instant payments
Instant payments were launched in the Netherlands in 2019 and will be boosted across the rest of Europe from 2020. They are carried out 24/7, meaning it would take 5 seconds to make a payment to another European country. For example, SWIFT gpi is available in almost all ING countries, reducing the time needed to transfer money to an international bank.
Peer-to-peer payments or credit transfers enable the recipient to receive their money instantaneously. The popularity of these payments depends on the country. For instance, in Southern Europe people tend not to ask for money, so payment request apps are not as popular as in Germany, Belgium or the Netherlands.
- The Internet of Things
The Internet of Things (IoT) is a system of devices that can process payments through the internet. Such wearables like activity or fitness trackers and smartwatches can add a payment feature, eliminating the need to carry a phone.
Biometrics makes the payment more seamless as it requires a fingerprint or face recognition for authentication. The next step is being identified by facial or posture recognition to pay invisibly. However, as long as fingerprints can be copied and recreated, it might provoke security doubts.
Although there will be less cash, customers won’t be cashless. People are concerned about how they would pay if all systems are down. There are also people who don’t want companies to know how they spend their money.
New entrants in the market are always expected to appear, which would fix customers’ pain points.