Here are the highlights from a recent Price Waterhouse Coopers study outlining ‘6 Macro Trends Affecting the Future of Digital Payments’.

1. Inclusion and Trust
   The World Bank has a stated goal to provide access to a transaction account to store money and send and receive payments for the vast number of adults around the globe who are not currently part of any formal financial system. As smartphone penetration is tipped to reach 80% by 2025, it makes sense for this to be digital via a mobile device, as it’s convenient and affordable. Therefore expect even more growth in mobile APP based digital payment solutions and improvement in systems to ensure we can have trust in mobile payment gateways, including data privacy.
2. Digital Currencies
   A recent BIS survey suggests that 60% of central banks are considering Central Bank Digital Currencies (CBDCs), and 14% are actively conducting pilot tests. The introduction of bank controlled digital currencies and private sector cryptocurrencies are predicted to have the biggest disruptive impact on the banking sector over the next 20 years. Digital currencies are here to stay and will become increasingly important.
3. Digital Wallets
   Digital wallets such as Apple Pay, the relaunched Google Pay and the rise of super-apps such as WeChat Pay and Alipay in China are becoming pivotal as a payment “front end” in the retail sector. Businesses can look forward to increased investment by fintech providers in mobile technology beyond retail payments to support business-to-business (B2B) payments and the digitalisation of supply chains.
4. Battle of the Rails
   If the digital wallet is the front end of modern payment methods, the back end is the behind the scenes payments processing or payments ‘rails’. The most popular payment rails include Automated Clearing House (ACH), Mastercard, VISA (and other major credit card providers), PayPal, the RTP Network, blockchain, SWIFT, and SEPA. Regulators are forcing the industry to strengthen the payments infrastructure as many of these payment rails have been too slow, too expensive, and not good enough at enabling cross-border payments. We expect to see increased adoption of blockchain as a payment rail, as Central Bank Digital Currencies are rolled out.
5. Cross Border Payments
   Users expect low cost, instant global payments, something traditional banks cannot provide. This frustration has led to a proliferation of new players and solutions that can provide the level of service more and more customers rightly expect. A recent pilot by Faster Payments Service, owned and operated by British retail payments authority Pay.UK, saw the fastest payment ever sent from Australia to a UK beneficiary, with confirmation of credit and funds available in just 36 seconds. Singapore and Thailand recently linked their respective national systems PayNow and PromptPay, allowing registered users on either system to instantly send money between the two countries using only a mobile phone number.
6. Preventing Financial Crime
   Expect to see greater collaboration among banks, payment providers and the public sector in preventing fraud and money laundering, with expected trade-offs between cybersecurity measures and customer convenience. As these measures come into effect, expect trust in digital currencies and payment methods to grow, but the need to work with a secure and trusted platform to remain an essential requirement.