Radar Payments: The Top Payments Predictions for 2022


This past year has seen an enormous shift towards digital transformation, as markets worldwide have continued adjusting to the initial pandemic aftershock. Fostering long-term economic resilience has remained a top priority alongside the rapid acceleration towards digitalisation, and a crucial part of this has been optimising the customer experience. 

Here, Jane Loginova, CEO of Radar Payments, shares her list of top banking and payment trends for 2022, which may not come as a surprise for industry peers. It is rather a top collection of the rising demands we receive from fintechs, banks and payment services providers across the globe. This should help financial institutions confirm their areas of focus in 2022 and years to come, ensuring their strategic priorities align with market needs while keeping in mind that fast movers are often the winners.

Jane Loginova, CEO, Radar PaymentsJane Loginova, CEO, Radar Payments
Jane Loginova, CEO, Radar Payments

Companies in all sectors have been forced to shift their mindset and perspective towards prioritising the seamless and secure customer experiences that have become expected in recent years. As social restrictions have continued to affect the frequency and ease of in-person experiences, the world has become more digitally interconnected than ever. 

Looking at the new year around the corner, these are the main things to watch out for and expect in 2022.  

SaaS Payment as the only way forward

The economic, societal impact and the demand for new digital services will continue to serve as a catalyst for the adoption of payments SaaS. 

While Gartner forecasts end-user spending on public cloud services to grow 21.7% to reach $482 billion in 2022, we at BPC expect that 80% of our business clients will primarily demand Cloud SaaS services within the next 2 years. 

Cloud-first is becoming the go-to model for banking and payment organisations that put agility, cost efficiency and reduced time to market on their top priority list.

There will also be an Increasing appetite for traditional banks seeking outsourcing shared services and white labelling of omnichannel payments in-house like fraud prevention, payment gateway and reconciliation services.

The year of convergence for the Connected Economy and IoT 

With over 50 billion connected devices being used daily – a number that is only set to grow further thanks to the advent of 5G – new disruptive consumer business models are being built upon networked devices. Forrester predicts that 2022 will be the year of convergence between edge, IoT and networking tech. The biggest change will see new digital ecosystems arise to deliver greater value for its participants (banks, consumers, businesses) using new generation channels. These digital ecosystems are underpinned by the use of APIs which ease connection to third parties and help expand financial institutions’ offerings beyond banking and payment. 

While we might currently think of IoT as devices on our bodies to track our health or in our homes to help us control the air conditioning, there is set to be a massive boom in smart infrastructure next year, with investment expected to increase by 40%. This will drive, among other trends, new sustainability-related services, with IoT being used for energy efficiency, smart mobility and resource management in areas such as environmental monitoring, resource management and supply chain processes, which are all on top of investors’ agenda. This will open up new horizons for financial institutions that wish to serve their business clients differently. Connected –first organisations will be a key differentiator for banks and fintechs in 2022 that wish to create new ecosystems. 

The rise and rise of SoftPOS 

Software point-of-sale or “tap-to-phone technology”(SoftPOS)  is gaining momentum against traditional EFT/POS based services and it will continue into 2022.  This is due to the rise in interest among SMEs around digitising payments, especially for economically viable tools like mobile apps.

ATM networks will continue on the decline, leaving more space for all in one intelligent kiosk devices to handle onboarding and instant card issuance without any cash function in any high street store.

Alternative payments not so alternative anymore with open finance

Amazon’s recent decision to stop Visa credit cards as a payment method for its UK customers due to high fees caused ripples around the payment sector. It was also a wake-up call for traditional card payment players, as alternative payment providers became mainstream and gave retailers more options than ever . 

This rise of account-to-account payment software, which blends payments and data, allowed a growing number of consumers, businesses and banks to process payments more cost-effectively than legacy payment methods like card payments. Real-time payments also improved the customer experience and payment security. 

The rise of this and other alternative payments will continue and increase throughout 2022 – and the one to watch will be the QR (Quick Response) code. 

Throughout the pandemic, QR codes have seen significant adoption as convenience and hygence become paramount. While China leads the way, with 70% of its population regularly using QR codes for making purchases, a 2021 Ivanti survey shows that 69% of Brits are open to using this payment method in the future, and the new year is likely to see more companies accepting payment via QR code.

Open Banking and Instant Payments (PSD2 and non-PSD2 regulated) will play a decisive factor between disruptors (such as payment service providers) and banks in controlling consumer payment methods such as QR codes – and the overall customer experience . At the moment banks are keeping as much customer data as possible to protect their competitive edge but the ECB and other central banks will continue to add pressure to open-up the payments gateway. This will also happen in the Kingdom of Saudi Arabia in the Middle East – one of the biggest digital transactional hubs in the world- as open banking regulations comes into effect next year.

A shake-up of Buy Now, Pay Later

Over recent years, Buy Now, Pay Later (BNPL) has been making waves as it matures into a high-demand product that rapidly exploded in popularity. In the US, six per cent of Gen Z consumers used BNPL in 2019, and a mere two years later, that number spiked to 36 per cent. However, this lightning growth accompanies new worries and issues around whether the proliferation of such services helps or harms consumers in the longer term. 

Across the globe, an Australian Securities and Investments Commission report showed that 21 per cent of BNPL users surveyed had missed a payment in the previous 12 months, and that of those who missed payments, over half used at least two BNPL providers. 

This is an ongoing international concern, and regulators are starting to pay more attention. In the UK, the Labour MP Stella Creasy has called for urgent regulation to stop young consumers from taking on an insurmountable mountain of debt.  As more people get into debt, regulators around the world are likely to start cracking down, especially alongside the rise in inflation. 

Australia will be one of the most vocal proponents for reform. Like the UK, the BNPL industry remains unregulated in the country, but the government recently announced it will broaden its payments laws next year to increase supervision and reign in control. 

Increased investment in fraud solutions

Despite the exciting developments of digital transformation, more lockdowns have meant a significant increase in the number and duration of people online: cybercrime has risen 600% due to the COVID-19 pandemic. This encompasses theft, embezzlement, data hacking and more, forcing companies to move quickly in their response. 

Overall, digital fraud continues to be a massive threat as fraudsters grow more sophisticated, with 20% of internal fraudsters working at an executive/C-Level and causing the highest average fraud loss ($600K). 

This has meant a demand for multi-layered real-time fraud solutions, which are only set to become more of a necessity in the new year. These solutions tend to leverage machine learning and AI to detect fraud. This type of system helps an organisation to react quickly to fraud innovations. It helps them ensure customers are safe while protecting the organisation from dishonest employees throughout the pandemic. 

CBDC regulation 

While there is still a long way to go before mass adoption, the future of crypto will get closer in 2022 – as digital currencies make their way to the top of the agenda for central banks. Central Bank Digital Currencies (CBDC) – the digital equivalent of a country’s fiat currency – will proliferate around the world and central banks will pilot them to find ways to lower the cost of cross border transactions and other services.  There will also be other digital models and initiatives emerging – leading to a demand for regulation to improve efficiency and protect the consumer.

Super Apps

Consumers keep asking for super-apps that will allow them to centralise services and create one giant marketplace that is available in one app, offering multiple capabilities into a single mobile application – from mobile banking to ticketing. These super-apps will continue to emerge globally in 2022, and this will drive up demand for paytech that can provide seamless integration with other apps and an enhanced user experience –  as multiple apps are aware of customer information such as location, buying preferences, and financial details.  

In an era where mobile users have increased their screen time to 25%, it can be difficult to imagine how we have survived without super apps. Digital banks are becoming ubiquitous as millennials (followed by generation Z) change the way they wish to bank. Apart from providing multiple capabilities on a single platform, a super app is a game-changer because it can be customised to a user’s needs. Open banking and APIs that interconnect these applications and payment services will be essential in building a super app. So will payments solutions – and we expect to see an increase in digital payments solutions by fintechs with customer-centric/lifestyles journeys focus.

Embedded Finance 

The rising demand for super apps will also lead to increasing demand for embedded finance. This buzzword has been described as the future of financial services and payments, and is the merging of a non-financial service provider, with a financial service, such as payment processing, or lending to make it easy to pay with little friction from the customer through an app – like Uber or Starbucks.  This is possible because embedded finance companies have disintermediated third-party banks and lenders and found a way to connect directly between themselves and the consumer. 

According to the World Retail Banking Report 2021 (WRBR) published by Capgemini and Efma, embedded finance will affect payments going forward and beyond 2022 by enabling all sorts of new business models to emerge. 

The trend will continue to accelerate as the economic fallout of Covid-19 coupled with post-pandemic disruption will increase demand for value-driven customer-centric banking. In order to meet this demand, banks will need to embrace Banking-as-a-Service platform models that use APIs to embed banking in everyday life. This will make services more accessible and inclusive for banking customers and will allow financial institutions to align their offerings with what the end-user wants.  

If banks fail to keep up, they could risk losing their customer base altogether, paving the way for new players to do what financial services were always supposed to do: put the customer first.

  • Polly is a journalist, content creator and general opinion holder from North Wales. She has written for a number of publications, usually hovering around the topics of fintech, tech, lifestyle and body positivity.