Technology-Led Shifts And Opportunities In Card-Based Payments

Jan 27, 2023


5 min of read

As technology continues to evolve more rapidly than ever, it has created ripples in the world of payment systems. While physical debit and credit cards were the standard for several years, these are quickly being replaced with scan-to-pay solutions and other mobile forms of payment. There’s no doubt that technology will continue to transform how we pay for things in the years to come – let’s explore these shifts and opportunities regarding card-based payments.

How Banks Are Modernizing Legacy Payments

According to, payment processors and established banks are modernizing three components of legacy payments technology. These are:

  • Infrastructure and deployments: This includes data and tokenization.
  • Middleware ecosystem: Some examples include analytics, authorization, and instruments.
  • Front-end channels and execution systems: This involves customer experience, financial wellness, and user interface.

Technological Shifts in Card-Based Payments

The rise of contactless payments

With the development of new digital payment systems, it has become easier and more secure to pay for goods and services without having to physically exchange money or credit cards. In addition to traditional card-based payments, contactless payments, also known as tap-and-go or digital wallet payments, are becoming increasingly popular. This payment type allows consumers to pay with their smartphones or smartwatches by simply tapping or holding their device against a payment terminal. Contactless payments are secure, fast, convenient, and accepted at more and more locations.

The technology behind contactless payments is based on near-field communication (NFC). NFC is a wireless technology that enables two electronic devices to exchange data when placed in close proximity to each other. This technology is the same one used for Apple Pay, Google Pay, and other popular digital wallet services. When making a contactless payment, the customer's device sends a signal to the terminal, which then securely processes the payment.

The rise of contactless payments has led to the development of new payment systems, such as mobile payments, wearable payments, and biometric payments. These systems offer consumers added convenience and security when making payments, and you can also use them to pay for physical goods, services, and even digital goods and services. In addition, retailers are increasingly offering loyalty programs, discounts, and other rewards to customers who make contactless payments. This, in turn, has helped to incentivize this type of payment and drive its usage.

For customers, contactless payments provide a convenient, fast, and secure way to shop. Customers can simply tap their credit card, debit card, or smart device on a reader at the point of sale to complete their purchase. As you pay for your goods, you'll no longer need to fumble with cash or wait in long lines at the checkout. It also eliminates the need to provide personal information with each transaction, such as an address or phone number.

For merchants, contactless payments provide a quick and easy way to accept payments. Contactless payments make tracking sales and managing inventory easier, since exchanges are automatically recorded in the merchant's system.

Contactless payments have become increasingly popular due to their convenience, but this has also made them a target for fraud and theft. To ensure the security of contactless payments, businesses should implement a variety of additional security features, like including other authentication methods such as PIN numbers, biometrics, and two-factor authentication.

Companies could also require cardholders to set up an account to use contactless payments and use additional security measures such as tokenization to protect customer information. If you're a business owner, be sure to regularly review their contactless payment systems for any security breaches and implement measures to ensure the safety of customer data. With the proper security measures in place, businesses can ensure the security of their contactless payments and protect their customers from fraud and theft.

Increased use of biometrics

Biometrics-based payment cards are an emerging technology that uses a person's unique physical characteristics, such as fingerprints, iris scans, and facial recognition, to authenticate and authorize payments. This technology is becoming increasingly popular as a more secure form of payment.

Biometric payments offer several advantages over traditional card payments. For example, biometric cards are more difficult to counterfeit and can’t be stolen or lost as easily. Additionally, biometric cards can reduce fraud by ensuring users are who they say they are. Unlike traditional cards, biometric cards do not require a PIN or signature to be entered, providing an additional layer of security.

In addition to increased security, biometric cards can offer a more streamlined user experience. Rather than remembering a PIN or signing a receipt, the user can simply use their biometric data to make the payment. This makes biometric cards a faster and easier payment method.In the future, biometric card payments will likely become even more popular as technology evolves. This could include further increased security measures, such as using dynamic biometric data and multi-factor authentication. It could also include the use of artificial intelligence to detect fraudulent activity. In the future, businesses will likely use biometrics to enable contactless payments, allowing users to quickly and securely complete transactions without having to take out their cards.

Deep learning and AI

Deep learning and AI are becoming increasingly prevalent in the world of card-based payments. Deep learning is a branch of machine learning which uses multi-layered artificial neural networks to process data from large datasets. AI, or artificial intelligence, is the ability of machines to learn from past experiences and to make decisions without human intervention.

Payment processors can use the combination of deep learning and AI to improve the security of card-based payments. With deep learning, payment systems can identify and track patterns in card usage, allowing them to detect any suspicious activity and block fraudulent transactions. Payment processors can use AI to enable machines to identify and verify cardholders, making it difficult for unauthorized individuals to access payment systems.

AI-based payment systems also have the ability to provide personalized recommendations and discounts to cardholders, thus increasing customer satisfaction levels. By leveraging the power of deep learning and AI, card-based payments can be made more secure and efficient.

The Internet of Things

In addition to allowing for easier payments, IoT-enabled devices are making card-based payments more secure. Through biometric authentication and encryption (as we mentioned previously), these devices can ensure that only the intended user can make payments and that their data is kept safe, making card-based payments more secure than ever before.

Moreover, IoT-enabled devices are making card-based payments more efficient. By providing detailed analytics on transactions, companies can optimize their payment processes and cut down on the amount of time spent processing payments. This is especially beneficial for businesses that need to process a high volume of payments regularly.

IoT-enabled devices are also making card-based payments more accessible. By allowing payments to be made through a variety of devices, including smartphones, tablets, and other connected devices, more people have the ability to make card-based payments. This is especially beneficial for people who may not have access to traditional payment methods, such as those in developing countries or those who are unbanked.


The advent of blockchain technology has revolutionized the way we make payments. By using blockchain, card-based payments have become more secure, efficient, and cost-effective. The distributed ledger technology (DLT) used in blockchain technology has made it possible to securely store and transfer digital assets without needing a third-party intermediary. This has eliminated the need for expensive and time-consuming payment processing, reducing costs and increasing the speed of card-based payments.

Blockchain has also allowed for the development of smart contracts, which enable parties to securely store and transfer money without the risk of fraud or double-spending. Smart contracts can be used to automate payments and ensure that all parties involved in a transaction are properly compensated for their services. Blockchain technology has also enabled the development of decentralized applications that will allow users to make payments securely and quickly from anywhere in the world.

Multi-function instruments

Multi-function instruments have had a significant impact on card payments in recent years. These instruments, which include point-of-sale systems, online payment gateways, and mobile payment apps, have allowed businesses to process card payments more efficiently and accurately. With multi-function instruments, companies can accept both credit and debit cards, as well as contactless payments, with just one device. This eliminates the need to purchase multiple devices and makes it easier for both customers and businesses to make and accept payments.

The increased security provided by multi-function instruments has also made card payments much more secure. With multi-function instruments, businesses can employ additional layers of security, such as PINs, to protect against fraud and theft. This gives customers peace of mind when making payments and makes it easier for businesses to detect and prevent fraudulent activity.

The convenience of multi-function instruments has allowed businesses to offer more payment options and better customer service. You can now pay with the payment option of your choice, such as credit cards, debit cards, or mobile payments, without having to wait for or carry multiple devices. This not only makes it easier for customers to pay, but also provides businesses with more detailed data on customer spending habits, allowing them to better tailor their services to their customers.

Final thoughts

While adapting to rapid technology shifts can feel challenging, these massive advancements can help make payments faster, easier, and more secure. As we embrace technology-led opportunities, card payments will become more efficient than ever before.

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