The year of pandemic pushed the limits on financial institutions on how fast and digitally capable they could be. Faster payments made headlines which put digital payment gateways to be more in action. Xformative, a master card start path recipient shared the views on how the digital payments were not only about faster payments but was also about the option of multiple methods of payment.
Which industries are lagging in digital payments space and why?
Due to the pandemic many financial institutions and their partners were forced to move to digital transformation. But not every industry had the ability to transform. Many laggards could be found. More than 1400 American freelancers, contractors supposed to have been still receiving their money through cheques and cash reported a survey from Bill.com, few space like property and casualties which still received physical checks.
The business providers need to offer more payment flexibility to meet the needs of their workers now that their business will rely on technology partners and to keep them in competition with real time speed and simplifying the payments process
How can fintechs overcome the challenges?
2021 should be about drawing the line between utilization and optimization, responsible fintechs should take the approach of balancing customer experience and economics with a mix of batch and real-time capabilities instead of constantly focusing on real-time choices.
Many businesses are looking forward to select a cloud provider thinking that architecture will be less expensive to operate than the main legacy systems. But for many it has turned their businesses upside down when the developers failed to understand the cloud optimization principles. Since fintechs build mainly in the cloud, they should make sure that real time leverages should be used only when there is necessity.
Why is offering more payment choices important?
Faster payment choice works in parallel and not as a replacement. Customers wants more options to choose from which they are comfortable like Apple pay, Venmo etc. or even traditional methods like cash and card. If the financial institutions are not prepared to meet this need the customers will be lost. These options portray the relationship between the program managers /banks brand values with the customers. And not just that it also communicates the lifestyle and socio economic status. We can see fintechs reassuring financial institutions with partnerships to include the broad scope of emerging payments that help evolve their brand value.
The fintechs and the institutions should partner to digitize payments since 2021 is all about offering choices and building smart , partnering capabilities that will open doors to mew opportunities.