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Despite economic uncertainty, consumer spending is strong, and innovative payment solutions are helping drive this growth. And as we look ahead to 2024, one thing is certain: Payments will continue their rapid evolution. Here are our expert predictions for how this will unfold in the coming year.

On Security & Gen Z

Security and reliability will continue to be critical, even as payments become simpler on the surface. In the past, data and transactional security were assumed to be a given. That is no longer the case. Not only is there an increased risk of data breach, but young consumers, like Gen Z, are very cognisant of security. As digital natives, they have to be. In 2024, we need to lock down security and clearly communicate the steps we are taking.

On Security & Gen Z

Security and reliability will continue to be critical, even as payments become simpler on the surface. In the past, data and transactional security were assumed to be a given. That is no longer the case. Not only is there an increased risk of data breach, but young consumers, like Gen Z, are very cognisant of security. As digital natives, they have to be. In 2024, we need to lock down security and clearly communicate the steps we are taking.

On Transparency

Transparency and context for the consumer will become extremely important, namely on the banking side. That means sharing data where the consumer allows it and adopting a more transparent approach to general data use. The U.S. ecosystem is very fragmented, and the consumer has to piece together a picture from multiple sources. We need to start improving that as an industry, both for the good of consumers and because regulation is only going to get tighter and tighter.

On Buy Now, Pay Later

Buy now, pay later (BNPL) is the new way to shop, and we’ll see it continue to grow throughout 2024. Hugely popular among younger consumers who want more flexibility and control over their spending, BNPL is being used for big-ticket items like furniture, electronics or travel as well as everyday expenses like groceries. Why use credit or debit cards when you can pay in installments with no interest or fees? With BNPL, you can manage your budget and avoid credit card debt, which is especially important in times of economic uncertainty. Going forward, it will have to be a seamlessly integrated part of any complete omnichannel shopping experience.

On Fees

The year ahead will likely see more fees across the industry. As venture capital-backed investment shifts and we see an increase in funding down rounds, I expect startups and scaleups will compensate with more fees. We’ll also see more creative convenience and service fees being added, given the network-driven caps on surcharging and cash discounting. Finally, the U.S. has some of the highest fees in the world, and we know from the CCCA that certain lawmakers are focused on that. Companies will be looking for new creative ways to monetize payments.

• Biometric payments gain consumer trust and wider adoption, and 25% of Americans already say they’re comfortable with using biometric payments
• Digital omnichannel commerce becomes table stakes for merchants, as 69% of consumers say they’re excited to try new payment technologies
• Increasingly complex government regulation creates challenges and opportunities, as multiple regulatory changes are either imminent or in development

• Embedded payments and finance emerge as key channels, with 50% of merchants already using a software vendor for payments
• Gen Z takes the lead in driving industry trends and growth, as their spend is set to triple by 2030
• Artificial intelligence (AI) becomes a critical payments technology, with 30% of companies already using it to enhance their offerings