Last updated January 2021 - estimated reading time: 5 minutes​

Over the past few years, payment technology has moved forwards rapidly – offering consumers a more convenient and streamlined payment experience.

But where to next?

According to a new report by Rambus, there's much to come.

Let's dive in.

#1.Context-based payments

A payment process carried out in the background, a context-based payment, requires no direct interaction between the customer and the merchant.

A perfect example of this is Uber – whereby the app makes the payment for you.

If you're wondering where it will go from here, think in-store context-based payments.

Given that the technology required is very sophisticated, there are currently many trialed (geolocation, communication, biometrics, and computer vision, to name a few).

At the moment, there are a couple of concepts that look promising.

• Google hands-free app enables consumers to say, "I'll pay with Google" to complete a transaction.
• While AI-powered technology allows customers to pay-as-they-go without queuing at the check-out.  One example is Amazon Go  enabling customers to go in-store, pick up items, and walk out – with their purchases automatically charged to their Amazon account.

#2. Biometric authentication

From fingerprints to facial recognition, apps like Android Pay and Apple Pay have been leading the way when it comes to biometric authentication. But software upgrades and product launches are likely to open up a whole new world of possibility – increasing the number of devices that support it.

Technologies like iris recognition, heartbeat analysis, and vein mapping, to name just a few, are being touted as potential ways of progressing biometric payment systems. It is hoped that they'll increase accuracy, efficiency, and security.

 Facial recognition is being tested for payment in China, in particular.

Indeed, recent research by Visa found that consumers across Europe have a preference for using biometric authentication when making payments.

Our 2018 research, conducted by GfK in the UK, revealed that 54% of UK consumers would be ready to use biometric payment cards.  Benefits are appealing to consumers that are currently testing these in many countries in Europe, Cyprus and even the Middle East.

And there's more.

In 2020, Amazon unveiled Amazon One: a new technology the company has started to test at some of its Amazon Go stores.  Amazon One scanners analyze the users' palm and the unique configuration of veins under the skin, letting them pay by waving their hand in mid-air – in the same way facial recognition works.  At first, Amazon One will be used for shopping and soon, as a replacement for tickets at music and sporting events.

Amazon One

#3. Rise of the wearable

In the world of mobile payments, smartphones are firmly in the lead.

But the advancement of wearables might soon change that given that the Global Wearable Payments Devices Market size is expected to reach $42. 9 billion by 2026.

Many wearables are currently based around health and fitness trackers.

Manufacturers are now working on incorporating additional features (like integrating payment functionality) to make them an everyday essential.

Given that they are immediately available and require no rummaging around in bags and pockets, wearable payment devices offer a real point-of-difference over smartphones and contactless cards as proven for the Rio Olympics in 2016.

So it will be interesting to see how they develop in the next few years.
 

#4. Mobile apps

As mobile technology improves, it's becoming clear that ease and convenience are not enough. Consumers want added value. And that's why certain mobile apps, such as Starbucks with their loyalty system, have done so well.

With over 3 billion loyalty cards provisioned to mobile applications by 2020 – it's only set to continue.

Consumers can expect a whole lot more in the near future. By recording past behavior and intelligently deploying user data, consumers could receive smart recommendations. And with the addition of augmented reality, consumers may be able to analyze product information and read reviews in real-time – rather than research at home. ​​

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• China accelerates its payment transformation
• Japan, a cashless society
• Taiwan and micro-payments
• Bank of Cyprus to supply the world's first biometric dual payment card for chip and contactless payments.
• Did Fintech deliver in 2019? 
• The technology behind Black Friday
• Central Bank Digital Currencies are coming