Digital payments are on the rise globally, with increasing adoption across websites, apps, and in-store platforms. Looking ahead to 2025, the payments landscape is expected to become more digital, flexible, and consumer-driven.
Key developments include the expansion of account-to-account (A2A) payments, the use of biometrics for authentication, and the globalization of cross-border payments.
Additionally, artificial intelligence (AI) is setting new standards for security and usability.
Key Trends Shaping 2025 Payments:
AI Guards Against Fraud
AI is set to play a crucial role in personalizing payment experiences and enhancing fraud detection. Advanced algorithms will analyze transaction patterns to identify potential risks in real time.
Visa has been at the forefront of AI in payments for over 30 years, investing $3.3 billion in AI and data infrastructure over the past decade.
In 2024, Visa introduced three new AI-powered risk and fraud prevention solutions as part of the Visa Protect suite, designed to reduce fraud across immediate A2A and card-not-present (CNP) payments, as well as transactions on and off Visa’s network.
Responsible use of AI remains a priority, with ongoing efforts to strengthen AI governance initiatives.
Digital Identity Simplifies Authentication
Traditional authentication methods like passwords and security questions are being replaced by secure credentials such as facial recognition and fingerprints.
This shift enhances security and convenience, reducing reliance on PINs and passwords. Visa’s Payment Passkey exemplifies this advancement.
Notably, Visa partnered with QNB in Qatar to launch an enhanced version of Visa Click to Pay for retailers, marking the first implementation of biometric authentication globally and setting a new standard for secure, seamless, and convenient online payments.
Real-Time Payments Gain Momentum Globally
By 2025, real-time payment (RTP) systems are expected to gain traction, influenced by developments in major economies.
In the U.S., the Federal Reserve plans to migrate to ISO 20022, an internationally accepted industry standard for exchanging financial information, in March 2025.
This transition is anticipated to boost the adoption of its RTP FedNow service, enabling instant payments 24/7/365 for financial institutions, businesses, and individuals.
In Europe, the Single Euro Payments Area (SEPA) Instant Credit Transfer Scheme will facilitate instant euro transactions across EU borders.
However, challenges such as fraud, security vulnerabilities, and lack of cross-border capabilities persist.
Collaboration with the private sector, including companies like Visa, can help address these issues by enhancing security, interoperability, and cross-border functionality.
A2A Payments Get Streamlined
While card-based payments offer certain experiences, security, and protections, electronic payments like ACH transfers have been slower to digitize.
Innovations such as pay by bank are digitizing and streamlining A2A payments, providing consumers with more payment options.
As real-time payments grow in popularity, so do associated fraud risks. Emerging tools like Visa Protect for A2A Payments are being introduced to mitigate fraud on RTP networks.
Embedded Finance Proliferates
Embedded finance involves integrating third-party financial products and services into non-financial digital platforms.
This trend is becoming more prevalent, particularly within the merchant ecosystem. There’s an increase in embedded finance lending products and white-label payment solutions.
When executed effectively, embedded finance benefits providers through low-cost distribution, enablers by meeting the demand for simplicity, distributors by enhancing platform engagement, and end-users by offering contextualized financial services in a single location.
Cross-Border Payments Travel Fast
Globalization has increased the need for efficient cross-border money movement for consumers and small to medium-sized businesses.
Traditional cross-border payments have been complex, costly, opaque, and slow. The expansion of real-time payment networks holds the potential to revolutionize cross-border payments, provided there is interoperability and mechanisms to process payments in multiple currencies.
Visa Direct serves as an example of a global network for real-time payments that is interoperable, enabling faster and more cost-effective cross-border transactions.
Improved cross-border payment solutions will allow businesses and consumers to transact internationally without traditional delays and fees, simplifying currency conversions and compliance with local regulations.
The payments landscape is continually evolving to offer greater convenience, transparency, and trust, empowering businesses to grow, consumers to feel confident, and communities to flourish.
Innovations such as secure biometric authentication and instant, seamless global transactions are pivotal in meeting the demands of all participants in the payment ecosystem.
Chad S. Pollock is the Vice President and General Manager, East Africa at Visa
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