New payment technologies improve the operating efficiency of enterprises

Modern payment and billing technologies are very interesting for two reasons. Firstly, startups from the fintech industry that deal with them can be excellent investment opportunities, and secondly, their development contributes to an increase in the productivity of the entire global economy.

Until recently, it seemed that payment and credit cards would remain in our wallets for quite a long time. However, it turns out that payment systems based on them have several significant drawbacks. Consumers, despite numerous safeguards, still did not feel comfortable providing their credit card numbers while shopping online and their fears were confirmed by numerous data leaks. For businesses, on the other hand, the problem was delays in receiving payments and the need to maintain separate, expensive payment devices. Simply put, the entire system was perceived as insufficiently secure and insufficiently effective. Therefore, both consumers and entrepreneurs are more and more willing to use new payment and settlement methods. Unlike card payments, they are cheaper, safer, widely available and real-time.

The costs of cashless transactions have been falling for a long time, even within the traditional banking system. This is due to consumer pressure and the systematically increasing competition. Additionally, there is significant pressure from regulatory institutions. In order to popularize non-cash transactions, they must also provide consumers and entrepreneurs with favorable terms of transaction settlement.

A significant increase in the security of non-cash transactions can be achieved thanks to tokenization. This solution allows you to make payments using one-time codes or one-time payment cards associated with your bank account. This means that your payment information, even in the event of a leak, will be worthless.

For entrepreneurs from the e-commerce sector, recurring payments are a particularly advantageous form of settlements with customers. They became the basis for the emergence of a new trend known as the subscription economy. Thanks to it, more and more products and services are available thanks to relatively small monthly payments. This is the case with cars, computer software, mobile applications or access to premium content on the Internet. Subscription economy is not only about payments — it is a new model of customer relations that facilitates high-quality service, largely based on automated business processes.

The costs of cashless transactions have been falling for a long time, even within the traditional banking system. This is due to consumer pressure and the systematically increasing competition. Additionally, there is significant pressure from regulatory institutions. In order to popularize non-cash transactions, they must also provide consumers and entrepreneurs with favorable terms of transaction settlement. A significant increase in the security of non-cash transactions can be achieved thanks to tokenization. This solution allows you to make payments using one-time codes or one-time payment cards associated with your bank account. This means that your payment information, even in the event of a leak, will be worthless. For entrepreneurs from the e-commerce sector, recurring payments are a particularly advantageous form of settlements with customers. They became the basis for the emergence of a new trend known as the subscription economy. Thanks to it, more and more products and services are available thanks to relatively small monthly payments. This is the case with cars, computer software, mobile applications or access to premium content on the Internet. Subscription economy is not only about payments — it is a new model of customer relations that facilitates high-quality service, largely based on automated business processes.

The development of the fintech sector should also lead to an acceleration of money circulation between economic entities and the related increase in efficiency. One method could be the wider use of electronic invoicing. For example, including the “pay now” button in an electronic invoice that activates the payment process, may result in invoices being paid by contractors even twice as fast.

Over the last twenty years, financial technologies have come a long way, from weekly customer visits to a bank branch to withdraw cash and make transfers to intuitive tools that allow you to conveniently manage your finances from your desk. This process is not over and the next 20 years will undoubtedly be the time of further development of the fintech industry

Polish Fintech specializing in advanced technologies and artificial intelligence in the world of finance.

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