In the decade ahead, the focus of payments innovation will shift from consumers to businesses, Forrester analysts state.
Payments will be an operating system as tech firms build autonomous payments into connected devices and platforms, or weave programmable payments into accessible, frictionless and secure customer experiences.
A new report from Forrester titled ‘The Future Of Payments' outlines how, by 2030, payments will become a feature in devices - including vehicles - with owners loading preferred payment options and usage rules into their profiles.
Increasingly blurred boundaries mean that practically anyone can declare themselves a payment provider, using banking-as-a-service to embed payments, Forrester states.
Customers can filter this choice through a lens of preference and habit. For firms, complexity is only increasing, as they try to reconcile the demands of customers with the plethora of capabilities from payments providers and networks.
Over the next decade, Forrester finds:
Tech titans will dominate the entry point for payments. Without regulatory intervention, tech titans will keep consolidating and orchestrating more of a customer's relationship with payments, assimilating value-adding services such as 'Buy Now Pay Later' (BNPL), card issuing, and P2P payments.
Payment fabric providers will dominate the landscape. These providers will help intermediate layers of the payment stack and encapsulate payments technology in vertical platforms for industries such as restaurants or airlines. Interoperability will be a winning strategy - controlling the point of access or the point of integration to a collection of networks.
Platforms will create their own payments networks. Taking cues from the likes of Singapore's Grab platform and Italian-based utility Enel, large firms such as utilities and telcos will seek to orchestrate their own payment platforms - enabling tighter control over payments and creating new revenue streams.
Forrester Principal Analyst Jacob Morgan says, “The last decade was all about mobile payments and the consumer. The next decade is all about building payment fabric for businesses - embedding technology, and programmable payments - as payments becomes an operating system.
Forrester Analyst Meng Liu says, “The focus of innovation will shift to business. Corporates as well as small- and medium sized businesses will pay to alleviate friction from arcane processes and legacy B2B payments.
"Payment providers will leverage a host of technologies such as AI, RPA, APIs and virtual cards to integrate, aggregate, and orchestrate the fragments and improve interoperability in the B2B payments value chain.
Forrester Senior Analyst Lily Varon says, “Retailers and brands seem to be stuck on one question when it comes to their payments acceptance strategies: ‘What is the next payment method I must accept from my customers?' But that's only just the tip of the iceberg.
"Now's the time to step off that proverbial hamster wheel and assess the many technological innovations that will shape the next decade, modify consumer behaviour, and declutter payments for their businesses and their consumers.