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    What are the Payment Trends to watch out for in 2022?

    The days of carrying a wallet around are numbered. And the future of payment is digital for both consumers and businesses. The revolution is already underway, as studies show that digital transactions might increase eightfold in 2022 to reach a yearly $78 billion. Contactless, frictionless, and fast payment methods are in-demand now more than ever.

    But the digital transformation is only beginning. So, which innovations might gain traction in the coming months? From BNPL solutions to CBDCs, we take a look at three defining payment trends in 2022.

    Growing interest in BNPL Methods

    BNPL stands for Buy Now, Pay Later. And this short-term financing plan draws in more and more consumers. Indeed, this payment plan allows customers to make purchases and only pay for them partially. Consumers typically pay upfront before clearing the remainder in a predetermined number of installments.

    Because of their ease of use, BNPL arrangements are becoming increasingly commonplace. One Statista research even showed that the number of BNPL users in the U.S. had soared over 2021. But countries like Australia and Germany are leading the way, with an 11% and 20% market share, respectively.

    Faced with skyrocketing inflation rates and broader economic uncertainty, the push toward paying in installments is another compelling argument. BNPL players will, thus, multiply as small Fintech companies and card behemoths compete with established banks to profit off a promising market. By 2024, analysts even predict that 4.2% of e-commerce transactions will rely on BNPL and soar past $680 billion a year later.

    Rise of Central Bank Digital Currencies

    Cryptocurrencies were the talk of the town in the past few years. Experts even expected Bitcoin to climb up to $300,000 in 2022. Yet, cryptocurrencies have displayed their sheer volatility, bouncing up and down in recent months before collapsing altogether. Prominent names like Steve Squeri have expressed their skepticism over the long-term prospects of Blockchain-based crypto assets. The American Express CEO said he found it hard for anybody to picture cryptocurrency becoming a fiat currency.

    Still, the interest in virtual money has not faded. But the future of digital currencies might belong to Central Banks. From Jamaica to Nigeria, ten countries have already issued a CBDC according to the Atlantic Council. An additional 24 have entered the development stage, while 15 more are currently piloting a CBDC initiative.

    The U.S., on the other hand, is still researching the possibility. But the idea has come a long way, with the Federal Reserve partnering up with the Bank of International Settlements to explore digital innovations at a dedicated research center.

    Wider adoption of Mobile Wallets

    Mobile wallets have long overtaken credit cards and are now the world’s widest used payment method. But this market will shoot up to more exponential heights, nonetheless. By 2025, half of the population might use a mobile wallet worldwide. The fastest-growing market globally, Southeast Asia, might grow by over 300% to reach up to 439 million users in three years.

    Companies like PayPal have already capitalized on this leading market to implement additional finance functions. These “super apps” provide several extra services, like P2P payments and BNPL. The digital payment giant also announced working on customer-centric services like loyalty programs and shopping management tools.

    Along with Western Europe, North America might witness slower growth. However, local-based businesses are gaining more ground. In Canada, for instance, mobile users have access to exclusive payment providers like Interac or InstaDebit. And the iGaming industry paved the way. Online casinos that accept InstaDebit are now widespread. With instant deposits and quick withdrawal, this payment method has made life easier for gamblers. Withdrawals are just as speedy and cost-free. Besides, InstaDebit allows players to keep their banking details private and secure thanks to high-level encryption techniques.

    Cash is dying out, and digital payments are taking the lion’s share. From e-wallets to Central Banks tokens, digital money will keep growing. And challenges will rise along with the need for heightened cybersecurity. The increasing volume of global transactions, indeed, will undoubtedly attract fraudsters. To tackle such scams, AI-reliant anti-fraud systems and digital IDs are already on the table. Incidentally, up-and-coming payment trends are sure to give rise to exciting innovation and be an enduring game-changer.

    David Novak
    David Novakhttps://www.gadgetgram.com
    For the last 20 years, David Novak has appeared in newspapers, magazines, radio, and TV around the world, reviewing the latest in consumer technology. His byline has appeared in Popular Science, PC Magazine, USA Today, The Wall Street Journal, Electronic House Magazine, GQ, Men’s Journal, National Geographic, Newsweek, Popular Mechanics, Forbes Technology, Readers Digest, Cosmopolitan Magazine, Glamour Magazine, T3 Technology Magazine, Stuff Magazine, Maxim Magazine, Wired Magazine, Laptop Magazine, Indianapolis Monthly, Indiana Business Journal, Better Homes and Garden, CNET, Engadget, InfoWorld, Information Week, Yahoo Technology and Mobile Magazine. He has also made radio appearances on the The Mark Levin Radio Show, The Laura Ingraham Talk Show, Bob & Tom Show, and the Paul Harvey RadioShow. He’s also made TV appearances on The Today Show and The CBS Morning Show. His nationally syndicated newspaper column called the GadgetGUY, appears in over 100 newspapers around the world each week, where Novak enjoys over 3 million in readership. David is also a contributing writer fro Men’s Journal, GQ, Popular Mechanics, T3 Magazine and Electronic House here in the U.S.

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