# The Future of Payments: Flexibility, Regulation, and Bespoke Models Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2022-04-20 Category: FINANCE Category URL: https://financedigest.com/category/finance Meta Title: 2022 Trends in Payments Sector: Flexibility, Regulation Meta Description: Discover the latest trends in digital payments, BNPL models, contactless payments, and the push towards a cashless society. Stay ahead with ECOMMPAY. URL: https://financedigest.com/the-future-of-payments-flexibility-regulation-and-bespoke-modelshtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/graphicstock-man-using-digital-device-make-payments-online-shopping-and-icon-customer-sbi-301984815-1736815862696-compressed.jpg) _By_ **_Paul Marcantonio,_** _Executive Director UK & Western Europe,_ [_ECOMMPAY_](https://ecommpay.com/) The payments sector has innovated and developed rapidly over the past few years, mostly to make existing processes as efficient and streamlined as possible. In the years leading up to the pandemic, the fintech boom saw the birth and development of many new [digital technologies](https://www.financedigest.com/digital-technology-and-startups-during-a-recession-how-to-stay-afloat.html "Digital Technology and Startups During a Recession — How to Stay Afloat") that sought to attract and gain customers – including the inception of By Now Pay Later (BNPL) models, advancements in cybersecurity, contactless payments, cross-border transactions, and more. Then, the pandemic consolidated years’ worth of [digital payments](https://www.financedigest.com/can-i-please-speak-to-someone-why-building-relationships-is-still-crucial-in-digital-payments.html "“Can I please speak to someone?” Why building relationships is still crucial in digital payments") innovations and effectively forced the sector to grapple with newer, faster, and more reliable ways to shift to an increasingly cashless society. In 2022, we have already seen the demand for contactless payments continue to increase, and a rise in more flexible structures to contracts and SaaS models whereby [customers have more control](https://www.financedigest.com/2019-year-customers-take-control-payments.html "2019: The year customers take control of payments") and leeway over how they sign-up and opt-out. Bespoke models are coming into play, and it will become integral to [customer satisfaction and retention](https://www.financedigest.com/agent-retention-is-central-to-improving-the-customer-experience-across-financial-services.html "Agent Retention is Central to Improving the Customer Experience Across Financial Services   "). **Flexibility** Flexibility is [becoming of increasing importance when it comes to attracting](https://www.financedigest.com/uk-becoming-less-attractive-for-investment-manufacturers-warn-2.html "UK becoming less attractive for investment, manufacturers warn") and maintaining customers. Alternative payment options such as the BNPL [model work](https://www.financedigest.com/how-collaboration-technologies-are-helping-organisations-to-embrace-a-hybrid-working-model.html "How collaboration technologies are helping organisations to embrace a hybrid working model") by allowing consumers to split the cost of their purchases over multiple payments, spread across a pre-agreed length of time. Ease of use and flexibility are the main advantages of the BNPL model. Purchases using this [payment method](https://www.financedigest.com/freelancer-payments-methods-what-you-should-know.html "Freelancer Payments Methods: What You Should Know") are made without friction during checkout, resulting in a straightforward and stress-free shopping experience. That said, however, whilst BNPL offers more [financial relief than upfront payments](https://www.financedigest.com/the-future-of-payments-biometrics-within-the-financial-ecosystem.html "The Future of Payments: Biometrics Within the Financial Ecosystem"), there is more to be done in the way of flexibility. By opting for BNPL when making purchases, customers are still effectively signing up to a contract, and, if they neglect to keep on top of the installments or lack in awareness of what they’re signing up to in the beginning, they could effectively be looking at more debt in the long-term than if they’d made the full purchase. Other types of payment plans and buying methods such as using [credit cards have also been opted for in favour of a softer way](https://www.financedigest.com/4-ways-to-get-a-bad-credit-loan.html "4 Ways to Get a Bad Credit Loan") of making purchases, so what we’ve seen over the past few years is a clear trend towards newer, more digital ways of customers managing finances and the start of a decline in traditional methods. The appeal of alternative [payments methods was originally centered around](https://www.financedigest.com/around-the-world-in-mobile-payments.html "Around the world in mobile payments") the flexibility of not having to pay for an item upfront, however, with contracts comes rigidity. In order to maintain customers, providers [need to shift the power back](https://www.financedigest.com/if-the-nation-backs-fintech-we-need-to-address-a-few-things.html "If the nation backs FinTech, we need to address a few things") to the customer. **Regulation** Calls for more regulatory framework in the [payments industry have existed for years](https://www.financedigest.com/2022-the-year-future-payment-trends-become-reality.html "2022 – the year ‘future payment trends’ become reality?") now, and in order for the sector to continue to thrive – in terms of maintaining customers, and attracting and retaining investors – this needs to be addressed sooner than later. Back in 2018, the General Data [Protection Regulation](https://www.financedigest.com/regulators-need-to-strike-the-balance-between-protection-and-strangulation.html "REGULATORS NEED TO STRIKE THE BALANCE BETWEEN PROTECTION AND STRANGULATION") (GDPR) sought to bring industries to a new level of compliance – finance and banking included – and, although not perfect, has undoubtedly changed the way personal data is handled. Specifically looking at the [payments sector](https://www.financedigest.com/combatting-economic-uncertainty-in-2023-with-the-payments-sector-2.html "Combatting economic uncertainty in 2023 with the payments sector"), regulations such as PSD2 and AMLD5-6 have significantly impacted the European payment ecosystem. Whilst a burden for many businesses, these new regulations have forced merchants to crack-down on [existing processes and up their compliance](https://www.financedigest.com/solvency-ii-pushing-existing-systems-and-processes-harder-is-not-enough-for-compliance.html "Solvency II: pushing existing systems and processes harder is not enough for compliance") with new protocols. As the industry [moves towards](https://www.financedigest.com/investment-advice-moving-towards-a-new-model.html "Investment advice – moving towards a new model"), and becomes more prolific in terms of innovations and competition, more regulatory framework will come into play. We’ve already begun to witness this over the past few years, but with the arrival of more fintechs and their diversified offerings, regulation will [continue to adapt](https://www.financedigest.com/scholz-if-germany-continues-to-adapt-we-will-make-it-through-winter.html "Scholz: if Germany continues to adapt, we will make it through winter"). **Bespoke models** The explosion of new [fintechs over the past few years](https://www.financedigest.com/three-waves-of-fintech-disruption-leading-trends-for-the-year-ahead.html "Three waves of Fintech disruption: Leading trends for the year ahead") has meant the subsiding of traditional models. Customers now expect [businesses to be able to offer bespoke models](https://www.financedigest.com/cfos-its-time-to-own-the-business-model.html "CFOs: It’s time to own the business model") that suit their financial needs and evolving lifestyles. The next iteration of successful fintech [business will consist of models](https://www.financedigest.com/7-factors-to-consider-before-your-business-moves-to-a-subscription-model.html "7 Factors to Consider Before Your Business Moves to a Subscription Model") that put the customers’ needs first. If organisations listen to their users and truly follow-through with addressing their wants, they will begin to [see improved retention rates](https://www.financedigest.com/ecb-governors-see-rising-risk-of-rate-hitting-2-to-curb-inflation-sources.html "ECB governors see rising risk of rate hitting 2% to curb inflation – sources") and overall business scalability. More [businesses will also be looking for partners](https://www.financedigest.com/the-evolving-role-of-the-cfo-from-scorekeeper-to-business-partner.html "The Evolving Role of the CFO: From Scorekeeper to Business Partner") which align with their core values and goals – in finding suitable partners they can make this a reality. The new wave of fintechs will see a prioritising of bespoke, tailored products, features, and technologies to streamline the [payment process](https://www.financedigest.com/are-your-payment-processes-in-cheque-for-the-new-legislation.html "ARE YOUR PAYMENT PROCESSES IN CHEQUE FOR THE NEW LEGISLATION?") for end-users, and finding the best partners in the space can help them to achieve this. We are effectively moving towards an era of greater control in the payments industry where bespoke [solutions are a key](https://www.financedigest.com/exploring-the-key-features-of-bnpl-solutions.html "Exploring the key features of BNPL solutions") business decision. The payments industry will continue to move past the need for tradition and instead prioritise experience and tailored offerings, creating a landscape where [customer engagement](https://www.financedigest.com/customer-engagement-whos-leading-the-way.html "Customer engagement – who’s leading the way?") is rooted in integrated networks and seamless processes. It’s clear that over the past few years the payments industry has experienced a revision of practices as a result of new [regulations and changing customer](https://www.financedigest.com/bahamas-regulator-holds-ftx-assets-pending-delivery-to-customers-creditors.html "Bahamas regulator holds FTX assets pending delivery to customers, creditors") needs. Looking ahead, the [next five-to-ten years will only see](https://www.financedigest.com/britains-next-sees-lower-profit-in-2023-as-consumer-outlook-darkens.html "Britain’s Next sees lower profit in 2023 as consumer outlook darkens") these elements flourish: competition will become more rife, as the market continues to boom more now than ever, regulations will become more refined and complex, whilst offering flexible and bespoke solutions will become the crux of most business models. --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---