It’s no secret that the manner in which we pay for things has changed drastically over the years. Cash, once the gold standard of payment, is increasingly being replaced by credit cards, bank transfers, and other digital options. As these changes continue to develop, the major players in the competitive payment industry are also shifting, with older companies giving way to new faces and fresh ideas. With the industry now reaching an inflection point with respect to how it may move forward, we decided to take the opportunity to reflect on where it’s been, where it is, and where it’s going. We’ll be looking at these changes with help from Allied Wallet, one of the current leaders in the industry and a case that exemplifies many of the industry’s trends.
Payment processing’s past
In order to best see how payment methods are changing, it’ll first be helpful to take a glance at how we’ve historically paid for things, namely with cash. At its base level, cash was, and still is, an incredibly useful source of value. It’s backed by the government that issues it, meaning that as long as the country is still solvent, the currency should still hold value, although that value will fluctuate based on market rates. What’s more, cash is widely accepted and requires no special technologies to utilize.
Of course, there are downsides to cash. One of the glaring issues with its use is a lack of security and traceability — if someone steals a wad of bills from you, they’re often gone forever. It’s also pretty much impossible to use cash when seeking to pay for things digitally. Any purchases you make from an online retailer or anytime you want to transfer money to someone who is not physically next to you is going to require some time of remote payment system.
Moving towards the present
The above issues are one of the primary reasons that there has been a move away from cash and towards credit cards and other forms of digital payments. To say that the internet has been a driving force behind the way we pay each other in the modern world would almost be an understatement. Rather, it may be more correct to say that it has changed the very nature of how we do business. At present, it is not at all uncommon for two individuals that have never met or spoken to each other to engage in commerce via a third party, such as Amazon or Alibaba. Since cash is not useful in this situation, payments have had to adapt to meet the changing needs of consumers.
Companies such as Allied Wallet have developed a number of tools to allow customers to pay for goods and services via the internet. For example, the company offers a global payment gateway that allows merchants of any size to accept credit cards and other digital payment methods. This opens the door for small businesses to more readily engage in e-commerce and provide their customers with payment options that do not center on cash. It also allows them to track sales data and other important payment metrics which in turn provides the ability to streamline customer experience and make businesses more efficient and profitable.
Though the internet is a huge force behind many of the shifts in the payment industry, there are many other technologies that have had an important impact on the ways we make payments. Mobile technology in the form of smartphones and tablets is one such innovation that has greatly influenced this area of commerce. From one standpoint, these devices are intrinsically tied to the internet and are often used to make purchases on the aforementioned sites. However, phones and tablets open other options as well for in-person payments that again have helped replace cash in recent history.
One of the prime ways in which Allied Wallet and others are steering this change is through the advent of mobile POS systems. These systems connect to tablets and smartphones to allow merchants to accept credit card payments without needing to be tethered to a landline. This is a significant change from credit card technologies of the past which often required a set location from which to make payments. The new technology is allowing small merchants to move away from a reliance on cash that has often limited their ability to do commerce in the past.
As we seek to determine the future of payment processing, we can look to the actions of industry leaders like Allied Wallet to get a sense of where things may be moving. One telling action here is the company’s recent partnership with Chinese companies like Alipay in order to more easily facilitate transactions with the third party retailer. That partnership allows customers with an existing eWallet account to utilize the Chinese company’s payment ecosystem seamlessly with their other payment accounts (Finance.Yahoo).
Additional changes in the payment processing industry are also underway, though it may be too early to tell what will be adopted by merchants and consumers at large in the future. One promising avenue points to the use of machine learning to better analyze spending habits and make processing techniques more targeted and efficient. Cryptocurrency also offers a host of intriguing options for payment companies and, though the technology is still young, it has many predicting that it will play a role in the future of the industry.
The above look at changes to payment processing methods offers a useful opportunity to take stock of the ways in which technology impacts our daily lives. By seeing the manner in which companies like Allied Wallet have helped make payments easier from both an online and in-person perspective, we can gain a better appreciation for how important payment methods can be when looking at the economy as a whole. In this sense, a look to the future of payment processing will not only help to tell us how we may soon be making payments but also may have further reaching implications for how we conduct our lives in general.
More about Allied Wallet at https://us.money2020.com/companies/allied-wallet