Payment methods have had quite a decade, integrating various ways individuals can carry out transactions. The digitization of the payments industry has introduced the world to cashless transactions.

Digital wallets, mobile payment systems, and QR code-based payments, amongst other innovations, have changed the payments landscape forever. The post-pandemic era for money has been primarily dictated by the use of cashless methods of payments, both for convenience purposes and the prevention of spreading infection.

Major vendors such as Apple & Google have wasted no time in making their mark on the biggest of economies, such as the USA. International finance and real estate events in Las Vegas, notably MoRe 2.0 Conference, have played host to industry veterans and financiers, providing insight into how digitization has expanded the world of payments into a new horizon.

Seemingly beneficial in every aspect, experts also shed knowledge on how there are still a few risks to be taken care of when it comes to digital payments and cashless transactions. Keeping these in mind, the impact of technology on payments can be summarized in the following way -

Benefits

When we talk about the benefits of payment digitization, there are a few major ones that come to mind. Experts taking the state at financial events have listed a few as the key benefits experienced so far, namely:

1. Convenience and efficiency at the forefront

   Digitization has made the demand for payments faster and more convenient grow more than ever before. A global spike in the acceptance of digital wallets, especially post covid, made way for e-payment giants such as PayPal ( a 22% growth), Google Pay (a 4% growth) & Apple Pay( a 7.3% annual growth) to integrate contactless payment as a leading industry sector. Without having to physically pay by cash, write a check or even take trips to the bank, consumers can complete transactions with much more ease and convenience.

2. Improved security

   The risks involved when carrying physical forms of money, such as checks and cash, have been relevant for decades. Real-time theft and check fraud are just some examples of risk factors in carrying physical money. This is where digital payments brought in a problem-solving change.

   Being digital, the risks related to theft and fraud are relatively lower, instantly reassuring consumers through its utility. Financiers and leaders at financial events, notably MoRe 2.0 Conference, have provided further assurance about the security improvements in digital payments. Introduction of secure payment methods such as tokenization, two-factor authentication, digital IDs, and biometrics have made it difficult for fraudulent activities to occur across a variety of use cases.

3. Increased transparency for the consumer

   Transparency is an essential factor for maintaining payments for any business, especially when maintaining a closer look at supplier relationships. Automating the invoicing process provides greater insight and control over outgoing cash flow, as compared to manually maintaining these records, which is prone to human error.

   Having a transparent cash structure also streamlines the process of going through workplace audits, as all your metaphorical cards are laid out on the table, per se. With both consumers and suppliers having easy access to payment details, there’s a decrease in confusion and chances of suspicious transactions taking place.

4. Saving processing fee costs

   Payment methods such as checks are loaded with processing fees & soft costs when making transactions. Businesses tend to lose a significant amount of money on regular check transactions. Some of the biggest names in the finance world taking the stage at

   International finance and real estate events in Las Vegas have touched upon the research showcasing how for most businesses engaged in B2B payments, paper checks cost them about 13$ per the invoice & $5 per check processed.

   In contrast, digital payments have a relatively more straightforward integration into businesses. Ease of traceability, faster transaction rates, more effortless collection, and less expensive to the business overall make digital payments the economical choice for businesses to adopt.

5. Accessibility for remote areas

   Digital payments have had a significant impact on making financial services available for individuals living in rural or remote areas. With access to smartphones, consumers in remote locations can access different services and financial mediums to carry out their transactions without having to visit the bank or any other financial institution every time a transaction is to be made. This is especially helpful for people dealing with handicaps leading to immobility who may not have access to traditional banking services.

   The rapid integration of online payment methods, such as QR payments, POS machines, SMS code payments have made transactions much easier for folks in remote areas.

Risks

Although highly beneficial and accessible, digital payments do have their fair share of risks and problems to be attended to. Keeping in mind the rapid integration of digital mediums in payments, financial veterans and innovators set to engage in key panel discussions at insurance & finance events in 2023, notably MoRe 2.0 Conference, will help provide insight into some of the challenges faced by the payment sector, namely -

1. Technical issues

   Just like any other instances of technology, online payments are bound to be subject to server crashes and errors. Heavy reliance on technology can be detrimental in cases of outage or network failures, restricting consumers from being able to complete transactions, and rendering the whole concept of ease of use void.

   Even with scheduled maintenance downtimes, businesses can suffer from such outages, experiencing high bounce rates. Investing in alternative methods of payments for times like this can prove beneficial, especially for priority transactions.

2. Suspect to fraudulent activities

   Although a solid foundation when it comes to security measures, digital payments do have instances when they fall victim to cases of fraud and digital theft. These instances include -

   • Phishing - Common throughout the digital realm, phishing attacks are executed through the use of fraudulent links & pop-ups, allowing scammers to retrieve personal user information and gain access to the financial details of individuals.
   • Identity theft - Committing fraudulent activities under someone else’s identity, known as identity theft, has been an ongoing issue in the world of online payments. Fraudsters can use various ways to gain access to personal user data and banking details to make unauthorized transactions under the individual’s name.
   • Clean Fraud - Usually the most challenging form of fraud to detect, fraudsters are able to use vital information about detection systems set up by businesses and integrate wrap-around the security system to hack into user databases.
    

   The global impact of fraudulent transactions using credit cards and other digital forms of payment has seen a steep rise, brought on by the rapid global digitization, over the last couple of years. Discussing possible solutions to this rising issue have been veterans in the finance industry utilizing their platforms at international finance and real estate events in Las Vegas. According to recent research, predicted global loss in e-commerce due to fraud is expected to be as high as $ 48 billion in the year 2023.

3. Barrier of technological literacy

   A persistent drawback in the seamless digitization of payments has been the barrier some demographics face regarding the literacy aspect of digital payments. Some senior citizens and individuals in remote areas, with little to no knowledge when it comes to using the internet or having access to it, find it difficult to educate themselves about using digital payment services, such as the process of setting up digital wallets.

   With a fear of the complexities involved with online payments, most of these consumers prefer to stick to traditional payment methods, hindering the development of the digital payment sector.

   Actively working on solutions to provide ease of use for such demographics is what will integrate digital payments even more rapidly. Insurance & finance events in 2023 will play host to industry leaders and innovators, helping you stay updated on the latest developments and perspectives to help further the industry.

4. Time & amount based restrictions

   Some of the financial institutions offering digital modes of payment have amount-based restrictions. For businesses dealing with a large client list of both b2b and b2c transactions, a limit on the number and amount of transactions can prove to be quite an inconvenience.

   OTP (one-time passwords) is also a security medium provided by banks when requesting access to a user’s personal account or approving online transactions. Although a welcome addition to security, privacy breaches by hackers gaining access to user databases and time-based restrictions can prove OTPs to be quite detrimental and inconvenient due to their time limit and protection against breaches.

5. Additional costs

   Although digital payments prove to be cheaper for businesses in the long run, the costs incurred in the initial stages especially can prove to be a burden. Setting up mediums for conducting online transactions, along with the costs of storing user data in systems provided using in-house payment softwares, can be a headache of a cost to incur for some organizations.

Conclusion:

Although a very rapid welcome on a global scale, digital payments still have to assess a few risk factors that can hinder smooth development and integration across the world. Eager to stay up to date on the latest developments, all eyes will be set upon financial experts and leaders, being hosted at insurance & finance events in 2023, providing the audience with engaging panel discussions and insightful keynotes.

MoRe 2.0 Conference, will be hosting its three-day event in Dubai and the USA, recognized as one of the most renowned international finance and real estate events in Las Vegas. To learn more, visit the link - more2conf.com