An average employed person uses several traditional and innovative payment methods within a day. Let’s say that this morning you ordered something from an e-commerce store and paid for it via PayPal. Then you went to the local store and used cash. In the afternoon, you’ll go to the mall and scan the QR code to buy a new shirt.

In the evening, you might tap your card onto a softPOS terminal to pay for a meal.

And then you might buy a game on the Microsoft Store or place a wager using cryptocurrencies.

This article discusses some innovative and futuristic payments that people are already using or will soon start to use worldwide.

The Rise of Cryptocurrencies

The crypto market has been through ups and downs since 2009. Some people were disappointed with these fluctuations, while others have become accustomed to using cryptocurrencies for their payments daily.

Cryptocurrencies, such as Bitcoin or Dogecoin, are based on blockchain technology, which ensures transparent payments and specific cybersecurity features through encryption and cryptography. As a decentralized payment option – we won’t call it a system because most people use it exactly because of the lack of a system – it has become popular with customers in different industries.

What’s more, some service providers and companies have embraced cryptocurrencies as payment methods. For instance, AT&T accepts crypto for paying bills online and AMC lets its visitors pay tickets via crypto.

In the future, Bitcoin, Ethereum & co. will keep growing, alleviating fast payments on a global scale. One disclaimer, though: as long as you don’t expect to get rich investing in crypto – which might happen, but is a form of speculation rather than investment – you’re good to go.

Cross-Border Transactions

International payments aren’t breaking news, that’s for sure. Since the inception of the SWIFT payment system (Society for Worldwide Interbank Financial Telecommunications) in the early 1970s and its development in that decade, people and companies have been able to send one another payments.

As time went by and technology advanced, money transfers became faster, with certain fees.

At this moment, organizations across the world have many options for cross-border transactions. From wire transfers and transactions through digital wallets to the aforementioned cryptocurrencies, numerous payment processing providers offer dozens of payment options.

The future that’s already here is embodied in this variety of options that organizations have at their disposal. If you’re in an industry considered a high-risk field, you’ll find a payment provider to handle your high-risk merchant account. The fees are higher than for regular merchant accounts, but you’ll get your assets sent/received in a relatively short time.

Super Apps and Integrated Payments

On the other hand, the Far East has embraced super applications – all-inclusive platforms that offer a wide range of services, from eCommerce and utilities to integrated payment options. This integrated billing for different services all available in the same place is something that countries and companies in the West will start implementing in the future. So far, the strict personal data protection legislation has been an obstacle to the swift development of such a platform. Now, different parties are working on bringing effective, yet data-protective laws to make room for such features.  

 Biometric Payments

Biometric authentication has been with us for some time. From scanning eyeballs before entering certain institutions with advanced security features to scanning fingertips to access smartphones, biometric verification is a well-known thing.

Biometric-based payments, however, are a relatively new way of additional identification confirmation.

Amazon One in the Palm of Your Hand

Amazon One is one such project, as reported by CNBC. Consumers can make a payment by scanning the palm of their hand at the point of sale. Before that, the merchant in question must sign a certain compliance agreement with the infrastructure provider – Amazon, in this case – to offer such services.

The consumer needs to register with Amazon One and submit the relevant data: credit card number(s), passport or ID number, and other requested personal data. Once the identity has been approved, the customer scans the palm of the hand, fingertips, or face as an additional authentication factor. The palm has proven to be the most convenient option at more than 200 POS terminals in the pilot project conducted by Whole Foods Market – part of Amazon Company.

Such biometric options are being implemented by digital wallet providers and other relevant payment processors and credit card companies.

Mastercard Biometric Payments

Mastercard has recently introduced the Mastercard Biometric Card – a payment card that contains the cardholder’s biometric data, in addition to the PIN chip. Special card readers are also produced for this purpose so that they can scan the cardholder’s fingertip at the point of sale. Similar to the example with Amazon One, the cardholder must provide all the relevant personal and payment information beforehand so that the card company can verify it. Once it’s approved, the consumer can start making payments with this card. If the scan doesn’t work properly, there’s still the option of entering the cardholder’s PIN to complete the transaction.

Open Banking and Account Democratization

We’ve already entered the era of open banking. With the adoption of the Payment Service Directive 2 (PSD 2) in 2015, the European Union has democratized the way banks and account holders access their accounts.

Now you can already allow third parties to access and analyze your bank account. It wasn’t the case in the past when banks had exclusive rights over their customers’ accounts.

The growth in the number of businesses offering financial and technological services has made lawmakers in the EU bring such legislation.

Thanks to these changes, both natural persons and legal entities can now advance their digital payment experience, improve their budgeting, and enjoy a more convenient payment ecosystem.

As the PSD 3 has been announced and will come into effect in 2025, both cardholders/account holders and fintech providers can expect more flexibility and comfort for online transactions. Banks will have to follow suit, but they’ll also find something valuable in these directives.

 AI-Enhanced Fraud Detection and Prevention

For the good or the bad, artificial intelligence will be our regular ai(-)de, i.e., (pun intended) in the time ahead in most walks of life.

The payment industry has already jumped on the bandwagon of chatbots, machine analyses of completed transactions, and the prediction of fraudulent activities based on previous cases.

Advanced Appearance and Works of Chatbots

If you’ve recently visited your bank’s website or used the mobile app, you must have noticed an updated chatbot, with more functions than before. To be even more precise, many banks are developing their own communication robots that go much beyond mere chatbots. It refers to both their functionalities and UI/UX features. What used to be a simple pop-up window two years ago has become a full-scale humanoid online robot with enhanced abilities. That’s what’s going on in the front rows – the part ordinary customers can see.

AI-Aides as Background Check Companions

In the background, AI-enhanced algorithms are crawling across customers and businesses alike to make predictions about some future potential scams. For instance, if a natural person has filed numerous chargebacks against various companies within a short interval, AI tools will notice it and notify the bank. The bank might then contact this person or take into account such activities and help bank managers act on these findings.

AI solutions will also be widely applied to analyze loan seekers and their credit history, assist in conducting background checks, and increase the security of both banks and their customers.