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With more than 30 years of experience, I have seen a lot of change and innovation in the payments industry. Over the last few years, digital payments have been impacted by COVID, followed quickly by aggressive growth. And now, we are facing a downturn, which is also affecting payments and how businesses think about them.

I have recently spoken about payment innovation on two podcasts:

During each podcast, I go into more detail and discuss even further-reaching trends, but I want to share the 3 biggest trends I see impacting payments right now.

Focus on ROI

There has been a shift of power in many companies from the CTO to the CFO, because companies are really focused on their return on investment. Whenever we speak to companies today, they want to see how they can get a return on investment through payments. And we see it really coming down to a focus on improving authorization rates, which leads to increasing revenue and decreasing costs. For merchants, there is an opportunity to lower the costs of transactions, especially those associated with cross-border payments.

Embedded Finance & Payments

Software platforms run businesses today. Think of Salesforce, for example, and all the ways they power what companies are doing. These platforms will be embedding financial services, like lending and embedded payments, so a company can open their banking account and accept payments right in the same platform they use to run everything else. This creates seamless experiences for their customers, the merchants, and provides additional value and stickiness for the platforms.

Payment Vendor Consolidation

At BlueSnap, so many of the companies we talk to are using as many as five payment vendors to meet their needs. What this means is every time they want to update their payments, they need to make the change five times. They need to do maintenance updates five times, too. It’s something we call technical debt, and it can easily consume your development team’s time. It is a true cost of payments that a lot of companies had previously ignored. But now that they are looking at ROI, they see that they can save money by consolidating their vendors if they can find that single payment solution that meets all of their needs for accepting global payments.

To hear more of my thoughts on these and other payment innovation trends, listen to the podcasts linked above.

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Frequently Asked Questions

What are cross-border payments?

Cross-border payments, or cross-border transactions, occur when the acquiring bank and the issuing bank are in different regions. When banks process cross-border payments, they perceive them to be riskier than domestic transactions, leading to higher fees and a greater likelihood of being declined

What are embedded payments?

Embedded payments are when payment functionality is embedded directly within a software platform, so clients do not need to integrate with another service to accept payments.

What are my options for embedding payments?

A few different models exist. You may be able to implement no- or low-code platform models without development help, but development resources are typically needed for implementations that have more customizable options. Depending on the model that you choose, your payments can be up and running in a day or two, or if you choose a more customizable model, a few months. You may also choose different fee structures, such as revenue sharing or buy rate.

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