Top Payment Trends to Watch in 2024

Consumer appetite for tech-enabled experiences drives merchants to remove more friction from the purchase experience

Today’s consumer expects faster, easier and more secure commerce experiences that effortlessly span the physical and digital worlds. These heightened expectations have driven innovation and merchant adoption of advanced payment technologies. Business owners across sectors – from retail to restaurant, entertainment and healthcare – continue to invest in solutions that reduce friction and simplify the purchase experience in order to meet and exceed their customers’ expectations.  

Global Payments Inc. 's recent 2024 Commerce and Trends Report provides insights regarding these and other trends to help business owners align their payment technologies with consumer needs and preferences. As I reflect on this report and what 2024 is likely to bring for the payments industry as a whole, a few things stand out: innovation in embedded payments is accelerating; POS software will continue maturing into a powerful growth and efficiency engine for SMBs; the generative AI opportunity is real, but still in its infancy; and the modernization of business-to-business (B2B) payments is beginning to live up to the hype (finally).        

Innovation in Embedded Payments   

The payment experience is increasingly embedded in the customer journey, a process that accelerated tremendously during the pandemic and continues today. Whether a consumer is purchasing on a social media app or taking their car to the shop for maintenance, they want the payment to be seamlessly woven into their experience. By 2026, the global market for embedded payments is expected to surpass $138 billion.

Embedded payments support a variety of digital payment methods – including credit and debit cards, digital wallets and bank transfers – with digital wallets increasingly favored in many geographies. Digital wallet adoption in many Asian countries is more than 80%, India is hovering around 90%, and more than half (53%) of Americans say they use digital wallets more than traditional payment methods. 

As embedded payments have gained in popularity, so have biometric technologies, which continue to show promise in making embedded payments increasingly seamless and more secure. Consumer familiarity with biometric technologies like Apple’s Face ID are opening up new opportunities to practically erase the payment as a specific moment in time in the commerce experience. For example, Global Payments is enabling a “walk out” environment at Atlanta’s Mercedes-Benz Stadium that essentially eliminates the checkout process.

Utilization of Generative AI Capabilities  

There is a lot of speculation about the application of generative AI (genAI), and it is often hard to decipher fact from fantasy. That will begin to sort itself out in 2024 as companies move from developing the governance frameworks for utilization of the technology and dabbling in proof of concepts to launching commercially viable solutions.

Payment industry players will generally divide genAI into two broad categories: How it can help them add business value and new revenue streams and how it can help them increase productivity. 

On the value side, there is huge potential for the technology to increase authorizations, improve sales forecasting, drive loyalty, reduce fraud, provide better analytics and customer engagement and more. 

There are also productivity benefits, utilizing genAI to eliminate work that is manual and repetitive so people can accomplish more while performing higher-value tasks.  These opportunities span almost every business function from software development to customer service.   

Reinvention of Point-of-Sale Solutions 

Consumers’ enthusiastic return to in-person experiences, particularly in retail and restaurant, has reinvigorated the demand for point-of-sale (POS) software solutions that help business owners operate efficiently and enable the omnichannel experience customers demand in today’s digitized world. More small and medium-sized businesses are realizing how the right POS software system can be the nerve center of their enterprise, helping to connect front and back office functions.  

For example, a customer may browse for clothes online, try them on in the store, and pay with a digital wallet. Whichever combination of these touchpoints they use, this can only be delivered seamlessly through a modern POS that enables a true omnichannel experience. 

Additionally, POS systems can manage inventory and customer loyalty programs, track sales and customer data and enable reporting. Many leverage artificial intelligence (AI) and machine learning to automate routine tasks and provide valuable insights into customer behavior, allowing business owners to make data-driven decisions and deliver personalized recommendations and promotions in real time. POS software systems will get even better as more AI-powered tools are integrated into them. 

Modernization of Business-to-Business (B2B) Payments 

B2B has been called the “next frontier for payments” for so long that the arrival of real, substantive progress is easy to miss. As we continue to see tight labor markets and employers looking for ways to drive more efficiency and productivity, businesses are increasingly willing to invest in technology that offers tangible value, which will drive greater B2B digitization. 

The market is still highly fragmented – and more adoption of technology to support workflows around accounts payable and accounts receivable is a vital next step – but it is finally happening and there is real momentum. 

Adoption of Technology that Solves Real Problems

Although cryptocurrencies and central bank digital currencies sparked a lot of conversations in 2023, they both feel like solutions in search of a problem in terms of their application to everyday commerce. In the near term, it is difficult to imagine compelling use cases that are uniquely suited to alternative currencies. 

Overall in 2024, the focus will be on further advancing existing payment solutions while layering in enhancements – like genAI-powered tools and biometrics – that take the end consumer experience to the next level. The payment companies that deliver these solutions in a way that helps business owners drive revenue while running their operations more efficiently will be positioned for success.