Money as we know it emerged around 5,000 years ago when Mesopotamians came up with shekels. Since then, humanity has been striving to optimize money flow and improve money exchange. 
From flying cash in China to letters of credit <a href="https://admin-prod.sombrainc.com:9443/blog/how-technologies-changed-money-transfers">used </a>by the Templars and up to instant digital payments, our civilization made impressive progress.
What are digital payments? Simply put, those are any transactions conducted via online or mobile tools rather than by an actual cash transfer. Digital payments are convenient, so millions of people around the globe turn to them for everyday transactions. 
According to the report by <a href="https://www.grandviewresearch.com/industry-analysis/digital-payment-solutions-market" rel="nofollow">Grand View Research</a>, the global market for digital payments was valued at $81.03 billion in 2022, and annual growth of around 18.5% is expected in the coming years. Digital payments are becoming more popular — and more technologically advanced. Below, we’ll discuss how digital payments will evolve in 2024.
<h2>Biometrics for security </h2>
According to <a href="https://www.juniperresearch.com/researchstore/fintech-payments/financial-crime-prevention-trends-report" rel="nofollow">Juniper’s Financial Crime Prevention report</a>, financial crime prevention tools cost will rise from $22.1 billion in 2023 to $28.7 billion in 2027. The researchers attribute this 30% growth to a response to cybercriminals targeting the ever-growing volume of digital payment transactions. 
What exactly will digital payment providers do to keep users’ money and data cyber-safe? One of the most obvious yet effective ways is implementing biometric authentication. Biometrics allows users to confirm transactions with facial recognition or fingertip scanning. Biometric features are unique and very difficult to recreate, so using biometric data for authentication is considered more secure than passwords. 
Some market players have already started testing biometric authentication for payments. For instance, <a href="https://www.cnbc.com/2022/05/17/mastercard-launches-tech-that-lets-you-pay-with-your-face-or-hand.html" rel="nofollow">Mastercard</a> launched a pilot program in May 2022, allowing retailers to offer biometric payments. The program is active in some stores, but Mastercard plans to extend it to new locations. Meanwhile, another research by <a href="https://www.juniperresearch.com/press/press-releases/biometrically-authenticated-remote-mobile-payments" rel="nofollow">Juniper </a>predicts that the value of remote mobile payments with biometric authentication will quadruple and reach $1.2 trillion by 2027. 
Increased security and convenience go hand in hand with customer satisfaction. With this in mind, biometric authentication is expected to become even more common by 2024, which will impact how people pay online.
<img loading="lazy" decoding="async" class="alignnone wp-image-12151 size-large" src="https://sombrainc.com/app/uploads/2023/03/How-Digital-Payments-Will-Evolve-in-2023_1-1-1024x636.jpg" alt="The chart illustrates the growth of biometrically authenticated remote mobile payments from 2022 to 2027" width="1024" height="636" />
Source: Juniper Research
<h2>Central bank digital currencies (CBDC)</h2>
The recent proliferation of digital currencies like Bitcoin, Ethereum, and Ripple prompted central banks to ensure that the money they issue stays relevant. Countries are now exploring the idea of central bank digital currencies to create an alternative tool for digital payments. 
As of January<a href="https://cbdctracker.org/" rel="nofollow"> 2023</a>, a few forward-looking countries have already launched pilot programs for state-owned digital currencies, while others are still researching or developing proof of concept. In total, 114 countries, responsible for more than 95 per cent of the world&#8217;s GDP, are addressing CBDCs.
Why is it a positive tendency for the financial sector? CBDCs will enable wider adoption of digital currencies within a regulated space. They will also allow banks to <a href="https://institute.global/policy/central-bank-digital-currencies-can-increase-financial-inclusion" rel="nofollow">boost financial inclusion</a>, improve public services, and speed up the development of digital payment technology. Although the implementation of CBDCs will take some time, this trend will probably have a significant impact on the online and mobile payments market.
<img loading="lazy" decoding="async" class="alignnone wp-image-12192 size-large" src="https://sombrainc.com/app/uploads/2023/03/How-Digital-Payments-Will-Evolve-in-2023_2-2-1024x636.jpg" alt="Image illustrates the quote that in total, 114 countries, responsible for more than 95% of the world's GDP, are addressing central bank digital currencies (CBDCS)" width="1024" height="636" srcset="https://sombrainc.com/app/uploads/2023/03/How-Digital-Payments-Will-Evolve-in-2023_2-2-1024x636.jpg 1024w, https://sombrainc.com/app/uploads/2023/03/How-Digital-Payments-Will-Evolve-in-2023_2-2-300x186.jpg 300w, https://sombrainc.com/app/uploads/2023/03/How-Digital-Payments-Will-Evolve-in-2023_2-2-768x477.jpg 768w, https://sombrainc.com/app/uploads/2023/03/How-Digital-Payments-Will-Evolve-in-2023_2-2-1536x954.jpg 1536w, https://sombrainc.com/app/uploads/2023/03/How-Digital-Payments-Will-Evolve-in-2023_2-2-2048x1272.jpg 2048w, https://sombrainc.com/app/uploads/2023/03/How-Digital-Payments-Will-Evolve-in-2023_2-2-362x225.jpg 362w, https://sombrainc.com/app/uploads/2023/03/How-Digital-Payments-Will-Evolve-in-2023_2-2-352x219.jpg 352w, https://sombrainc.com/app/uploads/2023/03/How-Digital-Payments-Will-Evolve-in-2023_2-2-372x231.jpg 372w, https://sombrainc.com/app/uploads/2023/03/How-Digital-Payments-Will-Evolve-in-2023_2-2-309x192.jpg 309w, https://sombrainc.com/app/uploads/2023/03/How-Digital-Payments-Will-Evolve-in-2023_2-2-100x62.jpg 100w, https://sombrainc.com/app/uploads/2023/03/How-Digital-Payments-Will-Evolve-in-2023_2-2-600x373.jpg 600w, https://sombrainc.com/app/uploads/2023/03/How-Digital-Payments-Will-Evolve-in-2023_2-2-120x75.jpg 120w" sizes="(max-width: 1024px) 100vw, 1024px" />
<h2>Super apps </h2>
A super app is an all-in-one application that provides multiple features and services, often seemingly unrelated, through a single interface. Today, the idea of getting all the necessary services in a single mobile app dominates the Asian market. WeChat, Grab, and Alipay are all super apps. But the concept is gradually expanding to Western markets, as well.
Naturally, customers want digital payments as a part of their overall digital experience within super apps. The possibility of paying within these applications is critical, so we can expect that some digital payment solutions offered in the Western market will become one of the supper app’s services in the nearest future. 
In the alternative scenario, super apps can arise from the existing digital payment solutions. For example, in 2021, <a href="https://www.paypal.com/uk/brc/article/enterprise-evolution-of-super-apps" rel="nofollow">PayPal </a>announced its plan to build a super app covering billing, peer-to-peer funds transfers, the possibility to buy and hold crypto, and educational materials on crypto trading.
Super apps simplify user experience and make it even more comprehensive. In the coming years, we will probably have a chance to see how super apps change customer experience with digital payments beyond the Asian market. 
<h2>Real-time payments (RTP)</h2>
Real-time payments can be processed in seconds. It is a vast leap forward in the business world since moving money between companies using traditional payment methods like ACH in the US usually takes from several hours to one day. Plus, transactions go through only on business days and during working hours, while RTPs are accessible 24/7. 
The RTP technologies are being implemented worldwide. For example, the UK has <a href="https://www.wearepay.uk/what-we-do/payment-systems/faster-payment-system/" rel="nofollow">Faster Payments Service</a>, a system that connects banks to enable real-time payments in GBP. Singapore has a similar system called <a href="https://abs.org.sg/paynow">PayNow</a>, which allows customers to transfer Singapore dollars between banks in the system almost instantly. The US is to join the party in 2023 with Central Bank’s <a href="https://www.frbservices.org/financial-services/fednow/blog/progress-update-fednow-pilot-program.html" rel="nofollow">FedNow</a> pilot project, and <a href="https://nordicpayments.eu/" rel="nofollow">P27</a> is to be launched in the Nordic countries to enable faster payment processing in the Nordic currencies and Euro. 
<img loading="lazy" decoding="async" class="alignnone wp-image-12153 size-large" src="https://sombrainc.com/app/uploads/2023/03/How-Technologies-in-Wealth-Management-Increase-Value-for-Clients_3-1-1024x636.jpg" alt="The infographic explains the implementation of real-time payments across the world" width="1024" height="636" />
Instant cross-border payments will probably be central in 2024 now that several countries have systems for real-time interbank payments in place. For example, PayNow announced integration with India’s UPI. All of this will take B2B digital payments to the next level.  
<h2>Buy Now Pay Later (BNPL)</h2>
The Buy Now Pay Later (BNPL) is a type of <a href="https://admin-prod.sombrainc.com:9443/blog/tech-outlook-financial-industry">embedded finance</a> that allows customers to purchase products now and pay them off over time, in installments and interest-free. 
<a href="https://greyviews.com/reports/buy-now-pay-later-market/557" rel="nofollow">GreyView </a>predicts the global market for Buy Now Pay Later to reach $3,7 billion by 2030, with an annual growth rate of 45.1%. Also, by 2025, the share of Gen Z and millennials using the split payment option is expected to increase by over 10% each, leaving the two generations in the vanguard of BNPL adoption. 
What’s behind this growth? Consumers get access to affordable payments; merchants benefit from purchases via an additional payment option. The pressure of the global financial downturn will also add to wider BNPL adoption, making it a part of many digital payment solutions. 
<img loading="lazy" decoding="async" class="alignnone wp-image-12154 size-large" src="https://sombrainc.com/app/uploads/2023/03/How-Digital-Payments-Will-Evolve-in-2023_5-1-1024x636.jpg" alt="The infographic explains the process of using Buy Now Pay Later (BNPL)" width="1024" height="636" />
<h2>Conclusion</h2>
The market for digital payments will continue growing in 2024. The broader implementation of biometric authentication, the potential arrival of CBDCs, the expansion of real-time payments across borders, the spread of super apps, and the increase in BNPL use will drive progress in digital payments. By getting a grip on these digital payment trends, you will better respond to market demands. 
<a href="https://admin-prod.sombrainc.com:9443/">Sombra</a> is a professional software engineering company with a <a href="https://admin-prod.sombrainc.com:9443/case-studies">proven track record</a> of fintech projects. We can build a high-end digital payments solution from scratch or upgrade your existing product. Our team is always here to help you address your business challenges with <a href="https://admin-prod.sombrainc.com:9443/fintech">custom software development for the financial industry</a>.

How Digital Payments Will Evolve in 2024

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