Technological advancements have been at the epicentre of groundbreaking change right across the fintech world over the last two decades. Spending money online and using our cards, e-wallets, and digital assets to buy goods and services has never been easier. While it might seem highly convenient and smooth from a user perspective, an enormous amount of effort and design goes into revolutionising these payment systems. Still, to truly understand the ingenuity involved, we need to look back to the early 2000s. 

Practical use cases

The main hurdle for fintech companies was to showcase not just why the technology was more convenient and easier for users, but also to prove that it provided the same security guarantees they would have if they went to a store and entered their PIN into a chip-and-PIN terminal. 

Sure, sending money online was a phenomenal upgrade compared to cumbersome, traditional systems involving cash and cheque, which would sometimes take days. However, for online payment solutions to truly take off, there needed to be clear use cases that showed they were better on multiple levels and in recognised markets. 

Casino gaming 

It wasn’t until the rise of e-wallet systems like PayPal and Neteller that the online payment revolution gathered momentum. In casino gaming, e-wallets handled nearly three-quarters of all online gambling transactions back in the early 2000s. This was a clear example of how users could deposit and withdraw their funds at a service they recognised – and put an extra layer of protection between themselves and their information. 

Rather than entering vital card information and having it stored it on a server, e-wallets allowed customers to simply sign up with their email address, linked to their bank account. Over the last 25 years, this innovation has continued to soar, resulting in a raft of new payment ideas. 

This includes payment systems such as Boku, which allow users to charge transactions to their monthly phone bill. As you can see at www.newcasinos.com/money-transfer/boku/, many new casinos are adopting this rapidly changing technology. Boku isn’t the only credit system where you can charge a deposit to your phone bill, but it highlights how innovation continues to shape the casino industry. 

From my experience, these ideas are often rolled out in casino gaming before you see them in other conventional markets, such as e-commerce, so payment systems that are new and creative can often show early promise within iGaming markets. 

Exploring the new digital frontier 

There’s no doubt about it – online payments are now the new frontier for the financial world. The broader global shift to the digital marketplace has helped online payment companies expand exponentially. 

Even with all the innovation they have shown over the last 20 years, if there was no market for their services or creativity, or customers still preferred to explore traditional avenues of commerce and business, fintech companies would not have been able to grow at anywhere near the rate they have. 

Look at how businesses adapt to their changing marketplace. They’ll spend big on websites, social media managers and digital marketing tactics to expand their audience and customer base. All of this speaks to how comfortable the audience is in the online world and how online payment solutions are now the dominant force driving the global economy. 

2010 onwards

Once online payments had firmly established themselves as a true innovation that could challenge the old guard and traditional financial systems, the race was on for companies looking to integrate some of the latest technological innovations. 

By the early 2010s, the rise of the smartphone showcased that the battleground had already shifted away from traditional online payment systems and had moved towards innovative payment systems. Online banks switched their focus to mobile apps, PayPal and other huge e-wallet companies moved their operations to mobile services, and the rise of Apple Pay is testament to just how sudden this shift was towards mobile payment solutions.

Apple Pay has captured a multibillion-pound share of the mobile payment market in less than a decade. It allows smartphone users to use their mobile devices as contactless payment devices, removing the need for physical cards. As they are often secured by a user’s biometric face ID, pin, fingerprint or a combination of these security tools, they have revolutionised how people spend, both in person and online. 

Some fintech experts believe it could spell trouble for companies like PayPal, who have long relied on their e-wallet payment systems to churn out profit. One thing is certain: it has completely transformed the fabric of online spending. You could make a strong argument that smartphones and mobile payment systems have revolutionised online payment systems more than any other device in the last 20 years. But just as they seem to be getting a stranglehold on the market, other companies and payment systems are looking to innovate further.

Summary

Although online payments have made tremendous progress over the last two decades, the industry will likely look completely different 10 years from now. A range of payment innovations is set to make headway into the market between now and 2030, with cryptocurrency and blockchain technologies among the advances that have seen a huge surge in users. 

Cryptocurrency wallets are easy and free to set up, and many providers, especially casino gaming operators, have started to utilise these platforms, allowing their users to withdraw and deposit digital assets. 

Others believe that the combination of AI and VR technologies could lead to people using biometric face recognition to pay for goods and services, as well as virtual reality shopping taking hold. 

While those are some of the more obscure predictions, nobody could’ve predicted 20 years ago that smartphones would have anywhere near the capability they do today. Given that trillions of dollars are flowing into AI, and companies like Meta are heavily invested in VR, it could be just one of several avenues that shape the course of online payments over the next 20 years.