As we go towards digitalization, the ease of payment and transaction is already in sight. Especially after the pandemic outbreak, cashless payment is preferable. People have started using their smartphones more than physical money to purchase products.
The shift of payment methods also slowly eliminates the use of cards as banks and financial companies have been integrating their systems with e-money and mobile wallets. Moreover, we can’t forget blockchain and cryptocurrencies as the future of transactions.
In the years ahead, Bitcoin, Etherium, NFTs, and other cryptocurrencies will be a means of transactions and payments. That’s why many blog posts, product videos, and infographics have been promoting the ecosystem.
With all the transaction innovations embracing us, are we ready to go all cashless and, perhaps, use other than fiat money? To prepare ourselves best, let’s delve deeper into the future of transactions and learn some practices to welcome digitalization.
The Future of Transaction
Some of the most visible transaction headways include the integration of AI and ML, the rise of mobile wallets, and blockchain technology. Let’s reveal the details below.
AI and ML Integration in Payment Systems
Many financial companies have been adjusting Artificial Intelligence (AI) and Machine Learning (ML) into their systems. The two technologies help them to handle process automation and fraud detection.
However, the function of AI and ML have gone beyond those simple jobs. As a part of future payments, they can provide customers’ transaction history and predict their future actions.
Some examples of AL and ML utilizations include giving payment method suggestions and providing real-time customer service. The implementation of AL and ML will continue to establish better customer experience, communication, transactions, and sales.
Mobile Commerce Skyrockets
In a society dominated by millennials and gen-Z, the use of mobile phones is inseparable from daily life. That’s why we see more and more upgrades and inventions on mobile apps and social media.
Many businesses are aware of this condition, which makes them take a step ahead to follow the current trends. They have been improving their websites and allowing customers to pay via smartphone.
Some examples of mobile commerce expansions include the development of mobile payment for financial channels, such as PayPal, Payoneer, Stripe, and Netteller. Moreover, social media like Instagram and Facebook have a direct button to purchase products.
Buy Now, Pay Later Becomes a Trend
One of the most favored payment options is Buy Now Pay Later (BNPL), which enables customers to get the products without paying simultaneously. This type of option has flourished in e-commerce platforms.
Around $1,249 billion of e-commerce payments are predicted to be done via BNPL in 2024. Customers value BNPL to help control budgets and finances even though they have to pay an extra price to use this payment method.
Bank Account Integration
As major financial industries, banks have been upgrading their capabilities to give convenient transactions to customers. They’ve continuously eliminated the long-winded processes and adjusted features to provide quick and real-time transactions.
With the vast growth of mobile wallets, big banks across the globe allow customers to fund their mobile wallets directly from bank accounts. Moreover, mobile transactions also lower the use of debit and credit cards.
The Fast-Growth of Blockchain Technology
Blockchain’s transparent nature has made it become the most successful transaction invention. Essentially, a blockchain is a shared ledger where every transaction must get approval from a network.
Blockchain has successfully promoted Bitcoin, Ethereum, NFTs, and thousands more cryptocurrencies. Users can trade, invest, buy, and sell digital assets in a safe ecosystem without complicated regulations.
Moreover, blockchain has successfully paved the way for cashless international transactions. In the future, digital currencies will participate in many industry sectors to cater to local and global customers.
Four Things to Prepare for the Future Transaction
With all transaction upgrades coming our way, we must bear ourselves well. Here are some things to prepare for forthcoming transaction methods to help us survive the era.
Start Using E-Money
As cashless payment gets more popular, you also need to plunge into the action. Familiarize yourself with paying with e-money using electronic purses or web-based services such as PayPal.
Stablecoins, which come from blockchain technology, are also included as e-money. They have fixed values to certain fiat currencies, mostly dollars and pound sterling.
Explore Digital Wallets
Get yourself a good knowledge of digital wallets. It can be mobile wallets that use fiat currencies. You can integrate your bank account to fund your mobile wallets for easier transactions.
Or, you also want to step far ahead in the cryptocurrency landscape by using crypto-wallets. There are hundreds of crypto-wallets that provide you with features for managing your digital assets.
It can be overwhelming for beginners to choose and use a crypto-wallet, so make sure you have basic knowledge before using it as your transaction channel.
Consider Using Digital Banks for your Business
Compared to retail banks, digital banks offer you better currency rates. Some of the digital banks that receive good reputations are Revolut and Wise (previously Transferwise).
Digital banks also permit customers to hedge their foreign currency exposure making it a good option for businesses.
Get Familiar with Blockchain and Cryptocurrency
Blockchain technology allows easy transactions with its decentralized finance (Defi) ecosystem. This invention eliminates the role of the middleman, like banks and government institutions in the centralized finance (Cefi) ecosystem.
Blockchain has made transactions far more manageable, especially for international transactions. Moreover, there are many crypto wallets available to support your trades.
Some crypto wallets are even compatible with smartphones making it easier for users to manage their digital assets.
The recent finance technology has enabled people to have better transaction and payment options. As we keep going toward a cashless society, it’s vital to know what our transactions will look like in the following years.
The future of transactions we cover above is only a general view of what will happen. More inventions and developments will always revolve around us. So, keeping ourselves aware of the new financial updates is necessary for today’s society.
- Video Marketing: A Complete Guide to Getting Started in 2023 - June 22, 2023
- Connect with like-minded Developers: 10 Unity Game Communities to Join - June 21, 2023
- Is YouTube the Most Popular Social Service? - June 8, 2023