The Future of Payments Is (Almost) Here: Top Takeaways from Money20/20

“Customers don’t care about payments. They just want their stuff.”

I admit, it was a bit jarring to hear this from Jason Kroosec, VP & head of Roku Pay at Roku, at the world’s largest fintech and payments conference. But in reality, the concept is the backbone of Money20/20 and all the companies attending it.

While those who live and breathe payments revel in the entire process — from card to gateway to processor to the bank and everything in between — the truth is that the more seamless the payments experience, the more consumers have the luxury of not having to think about it.

This theme ran through every session at Money20/20 USA 2022. Payment innovations and regulations are all about building better, safer, more seamless and secure purchase experiences for customers. These sessions covered a wide variety of topics, including:

• Payments in the metaverse
• Buy Now, Pay Later (BNPL): What it really is and why it’s here to stay
• The future of crypto
• What’s next for the Consumer Financial Protection Bureau (CFPB)
• Biometrics and digital identity

Businesses are a lot more excited about payment innovations than consumers…

It’s exciting to think about the future of payments and everything it has to offer, but it’s evident many of the largest companies in fintech have to restrain themselves from moving full-speed ahead.

For example, Sephane Kasriel, head of Commerce & Fintech at Meta, said that while Web 3 is an exciting concept and there are a lot of opportunities for the payments experience to become even more embedded in our everyday lives, the concept is too future-forward for the everyday consumer. They’re much more comfortable with “Web 2.5” — which combines the comfortability of Web 2 with some modest innovations from the world of Web 3.

It’s going to take more time for consumers to get excited about technologies like the metaverse and crypto. In fact, Sophia Bantanidis, Future of Finance, Citi Global Insights at Citi, says we still have 2–3 more “boring years” of metaverse development before consumers will truly care about the technology. And Jess Houlgrave, head of Crypto Strategy at Checkout.com, said that while many consumers will make payments on crypto rails, the vast majority of people won’t own a cryptocurrency like Bitcoin.

But many payment innovations are here to stay

While it may take consumers more time to get used to the metaverse, crypto rails and Web 3, it’s clear these technologies have a role to play in our shared future. Several speakers discussed the potential these technologies have in creating more seamless and safer payment experiences for customers.

BNPL is a payment option that consumers adopted fairly quickly — and one that fintech experts are confident is here to stay. Payments leaders made it clear that this alternative form of payment is an easy “yes” for consumers because it’s convenient and a natural budgeting tool.

As consumers’ preferences shift toward more convenient payment options like BNPL, QR codes and contactless — and as they get more accustomed to advanced payments tech like biometrics and Web3 — businesses will need to offer these technologies to meet consumers expectations. Money20/20 speakers emphasized how optionality is key. There are a lot of different payment options out there, and people want to use their preferred formats — if businesses don’t accommodate these preferences, they risk losing sales to those that do.

Regulation will pave the way for new payments tech acceptance

Regulations are both a major hurdle and an incredibly important part of payment innovations. Many of these technologies are nascent, and regulatory bodies like the CFPB are focused on creating guardrails for BNPL, crypto and other innovations to ensure consumers are protected when using these payment forms.

In fact, Houlgrave at Checkout.com said the top reason CFOs aren’t engaging with crypto today is the regulatory uncertainty. It’s the No. 1 issue to solve. And even though it takes time to get the guardrails right, it’s the nature of the game. Ashwin Basan, senior advisor to the Director at the CFPB, explained it’s their job to be careful and thoughtful in their approach, making the regulatory process slow and sometimes cumbersome.

Basan went on to say that financial services and regulation used to be much more consistent, but with these constantly changing payment technologies — and with more ways to pay than ever— we’re now in a period of whiplash and dynamic regulatory change. This can make it challenging for businesses to invest in these technologies let alone promote adoption.

But regulatory uncertainty aside, it’s clear we’re living in an exciting time for the payments and fintech industry, and on the cusp of some great innovations to drive the payments experience customers crave: One they don’t have to think about.

To hear more about the latest and greatest in fintech and our takeaways from Money20/20 USA 2022, get in touch with our fintech team.