The payments industry is set to undergo significant changes in the coming years, driven by technological advancements and shifting market dynamics. According to Prajit Nanu, the founder and CEO of Nium, a real-time global payments company, there are several key trends that will shape the industry in 2024:
- A2A payments: Account-to-account payments will continue to gain momentum in 2024, with more banks launching faster payment capabilities. This is driven by merchants’ backlash against ever-increasing card fees and the rise of open banking. Real-time A2A payments offer a cheaper, faster, and more secure alternative.
- AI and fraud prevention: While AI will have a significant impact on fraud prevention in payments, it is not expected to fundamentally change how payments are conducted worldwide. AI can make fraud attempts more sophisticated, but as digital payments become more prevalent, fraud prevention measures will also become more intense. Initiatives like SEPA instant credit are pushing the boundaries of real-time payments and necessitating stringent security measures.
- Consolidation: There will be a rise in consolidation in the payments industry, especially among B2B payments companies. Traditional banks and payment systems will also face increased competition from fintech players, driving them to collaborate and innovate to stay competitive. Businesses are seeking alternatives to traditional banking systems due to delays and hidden fees associated with international payments.
In addition to these trends, Nanu predicts a convergence of regulatory innovation, integration of AI, and the development of real-time use cases in the payments industry in 2024. The global economy’s increasing interconnectedness will drive the demand for efficient, secure, and cost-effective cross-border payment solutions.
