During the last two years, the number of digital payers has grown over 3 billion. No one asks why – to pay your bills without leaving a house, without queues and inconvenient cash is much more pleasurable. There are few trends that will influence digital payments in the nearest future. Some of them definitely will change not just the way we pay, but the way we think about our businesses.

The mobile payment and why your business needs it

The mobile payment is a new step in money evolution that we are widely using nowadays. It simplifies all financial relationships between a company and a customer, it replaces cash and credit cards with simple smartphone applications. So, if you want your business to survive in the new technology age, you should pay attention to it. What is going on with the market today? It keeps on growing. Thanks to Business Insider report, we know that 75% of all financial transaction will be digitalized by 2025. The usage of mobile payments will continue to increase especially among the millennials. According to Statista, the number of mobile payers will raise up to 1 billion in the next four years. Amounts of transactions will grow too. Look at this figures: Annual mobile transactions worldwide, in billion US dollars
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As we can see from the statistic, more and more users will spend money with the help of their mobile wallets. Stronger secure is not the last reason for it. Many of the modern mobile payment services are using tokenization to encrypt personal data. As an example, Apple Pay replaces a client’s card number with a token, so the system can reduce the risk of fraud. Even if a smartphone will be stolen, all financial operations on this card can easily be frozen. Also, mobile payment simplifies bookkeeping for a business. It helps to pay bills, invoice customers, make different financial transactions and do not get lost among all of that. Which business can be interested in the mobile payments? Almost every one. This statistic shows for which kind of services Americans pay more often through their smartphones. Most popular payments, USA
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It is a good idea to attract new customers with the convenient and fast payment system. No cash, no multiple cards or waiting in the line. But pay attention – a big number of users still tend to not trust mobile payments. Talking about the US, 59% of users worried about their personal information while using mobile payment apps. Less than 30% of payers completely satisfied with secure of these financial actions. All that means secure is still on the top of priorities, but with a good and high-quality performed systems cash and cards will go in the past.

The Internet of Things and payments thru the air

The Internet of Things (IoT) in general is a network of sensors around us. They can be implemented into different things from cars to wearables, connected to our gadgets to help us solve some daily problems and tasks. IoT is making possible Smart Home systems and revolutionizing engineering industry. What IoT can do for the payment sphere? 
"What's fueling the Internet of Things within the payment industry? It is the explosion of the Internet of Things in general. There are will be 50 billion connected devices by 2020. Obviously, those numbers are completely staggering. If people are constantly connected to devices in a new way, they start to expect interaction with any device around them. Why would that be any different for payment? So people will expect to be able to interact with a payment in a way they've never had before." Chris Tyghe, chief officer in Ingenico Group, Canada.
 Wireless payment is the most common example of cooperation between IoT and FinTech. This is the next step after mobile payment – a user can make his transactions not just without cash and cards, but without touching his gadget, too. You can imagine the level of convenience compared to traditional card operations. Wireless payments can be used for self-checkout services. For example, Amazon is working on an idea to create self-checkout stores with IoT-based payments. Global financial services such as VISA and Mastercard have already launched several IoT-directed programs. VISA, for example, has Visa Token Service (VTS) that protects payments thru wearables and other devices. Mastercard is working with Fit Pay to enable contactless payments for wearables users. Kiki Del Valle, senior vice president at Mastercard, told about the future of payments and IoT in finance: 

Biometric authentication and veins instead of signatures

VISA and Mastercard are also using effectively another trend in the digital payments. Fingerprint scanning, voice, and facial recognition are becoming more popular nowadays. During 2016, over 600 million payments were made thru biometric authentication in mobile payment apps, and this number expanded up to two billion in 2017. The same statistic predicts a compound annual growth rate of 83% compared with 2016. So, as we can see, biometric authentication will be mainstream in the nearest future. Started in the military field, biometric authentication began to spread because of smartphones. In Europe, for example, users still prefer fingerprint scanning more than retinal scan or facial recognition. Also, a combination of traditional PINs and some biometrical elements becomes more popular:
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As well as with IoT technology, biometrics can ensure digital payments without touching any gadget. A small scanner can check a person’s fingerprint that was previously connected to a bank card. But fingerprints have their drawbacks. The pattern can change with time and can be copied. Thus, a year ago UK-based company Sthaler launched the project designed to solve these problems. Instead of fingerprints, their Fingopay is scanning finger vein pattern that cannot be falsified. A similar solution was proposed by Keyo startup from the US. It’s using the veins of a user’s palm as biometrical characteristic. Some companies are working with even more fascinating data. Chinese Alipay proposes facial recognition technology for fast-food restaurants – a unique opportunity to pay for a dinner with your smile. The system is the same – the users can approve their payments by smiling to the terminal after registration in the system. The US-based security company EyeVerify applies groundbreaking technology that recognizes the blood vessels in an eye. The system has already been used by banks all over the country.  What are the main benefits of biometric authentication? Users need no longer to memorize all the PINs and take bank cards everywhere. Even if a card was stolen or lost, it is much more difficult to fake biometric data. Also, it simplifies the online payment process, so we can wait that people will spend more. According to Mastercard, the number of abandoned baskets on the online stores can go down by 70% in the case of using biometric authentication. *** Looking for a team that can realize your outstanding ideas? Ralabs ready to help. Check out our latest works.