Payments are evolving. The traditional payments ecosystem, says research firm Ernst & Young (EY), is being disrupted by solutions that prioritise speed, accessibility and cost. Fintechs are evolving the ways in which they use technologies to make money management into an experience that’s frictionless and fast.
The crypto payment landscape is also seeing remarkable uptake from consumers and businesses because it’s fast, cost effective and, most importantly, easy to learn and manage. Crypto has long since abandoned its reputation as a gimmick to become a payment method as natural as tapping a credit card. This evolution is largely due to the fact that crypto companies have been paying attention to what users actually want.
“From coffee shops to luxury retailers, businesses are saying yes to crypto payments because they’ve recognised they are more than just investment assets,” Hannes Wessels, general manager for Binance in South Africa explains. “Major players like Visa have opened their doors to crypto, while smaller merchants have realised that accepting digital coins can attract tech-savvy customers while reducing their transaction fee costs. People are using crypto to pay for their groceries, book flights, buy sneakers and even buy cars.”
One of the biggest drivers of this evolution is the fact that the cryptocurrency payment system extends beyond geographical boundaries and exchange rates, which makes it very cost effective for anyone to make and receive payments from anywhere in the world. Binance allows for customers to accept upwards of 80 popular cryptocurrencies, including bitcoin, making it very easy for businesses and consumers to make transactions within an ecosystem of 30-million Binance Pay users. The company charges no gas fees to users and merchants, and payments are made instantly, in real-time.
“In countries where traditional financial institutions dominate, people have had to live with high transaction fees and limited scope in their transactions for years, and now these accessible payments change the game completely,” says Wessels. “Transaction fees are lower, which can make it a lot easier for anyone to transact globally. Payments are also instantaneous so there’s no waiting for money to reflect over the weekend or across different institutions. You make a payment; your beneficiary receives it almost immediately.”
A place for AI
Speed and cost are only two sides of the crypto payment coin. The other is security. Over the past year, decentralised finance protocols have become increasingly sophisticated, allowing for radical improvements in how people can trade, lend and borrow their digital assets; AI has introduced advanced capabilities across security and fraud detection; and multi-chain architectures have allowed for the evolution of increasingly agile, efficient and scalable crypto solutions.
“AI is an invaluable tool that we’re using to tackle security from both an offensive and defensive perspective,” says Wessels. “Alongside our multiple layers of security across architecture, people and processes, we’re using AI to identify and neutralise threats before they can affect users. Security is only going to become even more of a priority over the next year and AI ensures we are on point and prepared.”
The move towards crypto payments isn’t happening in tech hubs or in niche groups. Street vendors, high-end boutiques and grocery stores are all allowing for people to make payments with their crypto. It has opened the doors to the world – for businesses it is the opportunity to engage with a global customer base and hedge against traditional currency fluctuations, and for consumers it is a way of shopping without borders, and within trusted ecosystems.
“What started out as a niche payment method for enthusiasts has become a practical, everyday tool that makes managing money very simple,” concludes Wessels. “And its evolution has only just begun as contactless crypto payments become the norm, virtual currencies become more commonplace as a form of investment, and financial management is as accepted in the crypto space as in the traditional one.”
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