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Fintech Trends in Payments 2021

Despite the overwhelming effects of the Covid-19, fintech shows agility, resilience, and ingenuity in developing new payment methods and innovations. Trends that got their acceleration in 2020 will dominate also in 2021 year continuing their widespread adoption. 

Coronavirus outbreak severely affected all spheres of life producing the domino effect on all spheres of the economy. Like a row of dominoes knocked the next one crisis in one sphere resulted in a more severe crisis in another one.

The measures to mitigate the disease spread have destructive consequences on international trade, manufacturing industries, and rising unemployment. 

 Coronavirus fueled payment sectors becoming sort of a trampoline that accelerated the rate of steadily developing pre-pandemic trends and pushed new era services and products toward customers. It’s pretty obvious that trends having been widely adopted at lockdown times will continue to extend their presence this year too even after the pandemic conditions would be terminated.


  • Resulting from lockdown the consumer spendings is sharply down in most cases leading to low revenues.  The business strategy, as well as consumers’ shopping behavior, have changed making businesses search for new ways and most of them go online promoting e-commerce development.  By going online businesses get the chance to rise the volume of transactions and thus compensate for the losses caused by the lockdown. 2020 Holiday sales statistics have proved that the future is after online shopping driving E-commerce to gain forces. According to  Mastercard SpendingPulseTM, e-commerce sales rose to 49% during the holiday period preventing the business from catastrophic losses and even benefiting them by enabling customers to choose holiday gifts in the comfort of their homes.


    As E-commerce is also seeing a surge, the move toward cashless payments is increasing thus the emergence of digital payments is promoted on the payment scene. 

    According to the European Central Bank, the total number of non-cash payments in the euro area increased by 8.1% in 2019 compared with the previous year and on, and card payments accounted for 48% of the total. Of course, these statistics have also changed to 2020. According to Accenture’s report, UK cash usage declined 50% during 17-25 March 2020.  COVID - 19 prompted the digital payments offering innumerable benefits to payers and kept the lifeline keeping the economies running. 

    Digital, embedded, and mobile opportunities, in particular, are providing the best services propositions in a remote-working economy.

    Contactless payments are another reason for digital payments proliferation because now the population is more concerned with what they contact and how they contact.  the surveys hold in April by MasterCard showed that of 17,000 consumers in 19 countries, 82% of respondents consider the contactless payments to be ‘the cleaner way to pay.’”  It led to the rapid decline in cash usage since banknotes aren’t considered hygienic anymore and lockdown keeping people at home reduced the in-person payments, therefore, the rise of digital payments and contactless cards isn’t a coincidence. For example, CO-VID 19 favored the growth of contactless cards and e-wallets on the change of swipe cards. Having the same infrastructure as traditional cards however the NFC and RFID technologies have enabled them to connect with merchants as opposed to EMV chips and magnetic cards promoting contactless payment processing. QR codes see an uptake as a safe and fast payment solution and are one of the most popular payment methods in China.  As we see taking into account factors such as infrastructure, consumer behavior and rising revenue the adoption of digital payments will differ in regions dependent on the level of internet development. In regions, for example, the USA or APAC countries, the transition to cashless payments is overwhelming with digital wallets and mobile and online banking becoming the main payment method as opposed to cash payments. The variety of digital payment methods allows flexible and convenient payment implementation providing the payers with a choice option. 


    Embedded finance has been one of the main banking topics of 2020 and COVID - 19 accelerated the adoption rate. The idea of integrating financial services into provider solutions allow companies from different industries to broaden the customer experience by providing them with access to financial services at the point of need. Brands like Amazon, Google, Apple, Uber are broadly introducing embedding payments services, for example, Google Maps allows you to buy parking lots directly from the application instead of having to use another application. embedded finance allows organizations and enterprises to open up new revenue streams and reinvent the services they offer to their customers. This will be supported by the Banking-as-a-Service (BaaS) ecosystem, which offers the full banking stack to any business, regardless of industry, seeking to improve customer experiences with capabilities it would have been unable to build alone.


    Blockchain, IoT, and AI are key technologies driving the next wave of digital transformation. Blockchain technology, the Internet of things (IoT), and artificial intelligence (AI) are recognized as innovations that have the potential to improve current business processes, create new business models, and disrupt the whole payment industry. The reciprocal use of these innovations would help to save on operational costs, reduce risk, automate credit decisions, detect fraud, offer predictive analytics to improve trade decision making and reduce overhead. The core example is payment facilitated on IoT devices by Blockchain network that secures big data exchange and AI providing the authorization by face or print mark recognition broadly utilizes its fraud-prevention and security options. 

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