Verto
Switchcare
Professional Services
Report Link: Payments Industry Trends | Deloitte US
Size of Report: 12 pages
Short, succinct paper which sets out a few themes ALL with the underlying message to act now as consumer demand for change is outpacing the internal timeline to change legacy platforms.
- Digital adoption has seen unprecedented adoption rates, opening the door to new innovations.
- Real-time payments technologies have developed a strong foothold in the market amid increased demand and fast-tracked customer comfort.
- These converging trends have led us to a pivotal moment of change to bolster the foundations.
Mobile Payments expected to have a CAGR up to 2025 of nearly 27%, whilst digital identity as a tool will be enabled by biometrics with a 63% CAGR up to 2030!
Real-time payments are growing 69% annually and will accelerate, but the biggest challenge is not globally interoperable clearing, but the challenge caused by the harder to recover real-time fraud and risks of real-time bank runs driving faster insolvencies.
Payment organisations in this environment should ask three questions of themselves because what is fundamentally clear is that platform modernisation is needed for future tech enablement, and infrastructures must support iterative change, especially considering the ISO mandate:
- What investments are needed to strengthen and modernise technology and operations infrastructure to allow for continued innovation?
- How can we mitigate fraud risk and losses as transaction speeds increase?
- How do we ensure our workforces are adequately equipped to support these new payment methods?
Next-gen solutions will be at the forefront of combatting new fraud and scam strategies. The increased speed of transactions and the popularity of peer-to-peer (P2P) payments and transfers have led to (in USA) greater fraud losses year over year, with 2022 ending on $1.76 billion in losses, double that of the prior year losses reported to the Federal Trade Commission, and this fraud is driven by two primary forces: an increase in the adoption of P2P payments and an increase in the prevalence and sophistication of fraud schemes.
Whilst fraud has often been financially compensated for, scams have not BUT legislators are lining up to make banks pick up responsibility for acting against scam losses as well. Modern tools are needed for these modern times.
Financial institutions are at a crossroads. Table stakes are high, as is the need to assess their technical infrastructure, fraud mitigation strategies and workforce management approach to support the trends that will take off. Actions include:
- Increase partnerships to support fraud prevention.
- Push for digital identity standards.
- Invest in data management and API development to enable plug-and-play connectivity to new rails.
- Make changes to operations and organisational structures to emphasise upskilled functions.
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