NEW YORK—What will be the top payments trends in 2024?
Global Banking And Finance has identified what it said are the top trends financial institutions, fintechs and retailers will be addressing in the new year.
Those trends include:
In-store Pay By Bank Goes Mainstream
“The arrival of Pay By Bank, a new alternative payment method (APM) that allows consumers to pay for goods and services in-store via an account-to-account transfer, is already seeing growing traction among retailers,” Global Banking and Finance said. “Building on consumers’ desire for convenience and security, Pay By Bank payments involve shoppers simply scanning a QR code and automatically opening a mobile banking app to authenticate and authorize payment.
“For retailers, Pay By Bank’s lower transaction fees make it especially appealing and why it is likely to cement itself as a favored payment by the end of the 2024,” it continued. “Furthermore, there’s no need to clutter payment devices with third-party apps as no additional downloads for Pay by Bank to work are required. App-based, Pay By Bank can also easily be linked to loyalty schemes and tailored offers to encourage shoppers to make repeat purchases.”
Digital Footpaths Break into the Boardroom
“Digital payments like Pay By Bank, smart speaker payments, and biometric authentication are creating a wealth of interconnected payments and customer data,” the forecast continued. “Once solely used by customer experience (CX) teams, these digital footpaths will become mission critical in 2024, with many retail businesses leaning heavily into the insights provided.
“Hurried up the boardroom agenda, retailers will use these digital footpaths to identify and realize new areas of business growth – essential in today’s economic climate and as the cost-of-living crisis continues to bite for consumers. From new product offerings to launching new channels and even where to open new stores, digital footpaths will provide the most valuable insights to retailers in 2024,” Global Banking And Finance stated.
Loyalty Dies
“Although the Bank of England expects inflation to slow, it does not believe it will be back to normal levels of around 2% by at least the end of 2025. Consumers will continue to feel the pinch, likely killing brand loyalty,” the report observed. “According to research by McKinsey, around half of consumers reported switching brands in 2022, compared with only one-third in 2020.
“More worrying for retailers, about 90% said they’d keep changing. With the cost-of-living crisis set to roll on, loyalty will die as customers search for lower prices, exclusive offers, and a better CX,” the forecast continued. “As a result, brands will need to double down on the personalization of offers through insights and payment data if they are to retain customers.”
Retailers Cash In on Data
“Next year will see the retail business model flipped on its head. Building on the success of using customer data and analytics to deliver tailored and personalized experiences for their own customers, retailers will also accelerate selling access to their treasure trove of data to advertisers, suppliers, and brands,” Global Banking And Finance. “By the end of the year, reports of retailers generating up to a third of their revenue from selling data to marketers and others seeking access to consumer spending insights will emerge.”