2025 payments trends and Finextra’s predictions for the new year

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2025 payments trends and Finextra’s predictions for the new year

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Launching soon, Finextra’s PREDICT 2025 channel will gather insights and ideas from the industry's top thought leaders, capturing how the financial services industry will tap into technology trends in 2025 and these predictions will be shared with our 700,000 monthly readers.

From November 2024 to March 2025, Finextra will be hosting video interviews recorded in-person and virtually with an esteemed collection of experts, promoted on our dedicated channel that also collates written op-eds that explore fintech hot takes for 2025, tagged by technology or topic.

You can view Finextra’s PREDICT 2025 channel here. We’re currently accepting content for this series, so please don’t hesitate to get in touch via content@finextra.com if you’d like to participate. To kick start our channel and the forecast for the year ahead, here are the Finextra community’s predictions for trending topics in 2025 in payments.

Open finance

The move towards open finance will be determined in 2025, with PSD3 and the associated PSR coming to the fore. As quoted in Finextra’s Future of Payments 2025 report, Kevin Flood, director, FIS payments ecosystem strategy, corporate and international banking, FIS Global, stated that these regulations are expected to “foster and drive innovation.”

Pushing open finance forward, Flood also believes that “PSD3 may lower the barriers for new entrants, by lowering regulatory and compliance barriers, new fintech startups may find entrance to the market easier by promoting more innovation.” In the US, with the CFPB’s section 1033 being passed means that open banking will also move across new horizons in 2025.

Embedded payments

As Sehrish Alikhan, Finextra reporter, wrote in the Future of Embedded Finance in Africa 2025 report, the beauty of embedded finance and payments is “that it integrates everyday needs into the digital experience, making payments, credit, and financial services within applications easily and without disruption.

“This allows for more accessibility to underserved populations who may not have the facilities to set up traditional bank accounts, savings, insurance, and other essential financial needs.” The benefits of embedded payments is clear, and as the report suggests, this will become more of a trend in many regions where accessibility to financial services is lacking.”

Treasury technology

In a recent LIVE@Sibos FinextraTV interview, Rachel Whelan, managing director, APAC MEA head of corporate cash management and global head of payments and TFX product management at Deutsche Bank, predicted that corporate treasurers will be looking at real-time treasury even more so in 2025.

Whelan gave a reason for this and it is all to do with the impact of 2024 – a year in which elections, geopolitics, and volatility have meant that risk management remains the biggest requirement for treasuries. Treasury technology and the data that comes along with it, will increase the speed of change in 2025, and open banking, APIs, and AI will be the drivers.

Faster payments

While the instant payments conversation in the UK and Europe is focused on APP fraud reimbursement and confirmation of payee, in the US, faster payments still requires education, adoption and integration. A number of painpoints such as cost, user experience, and a lack collaboration have prevented faster payments from taking off and the payments ecosystem remains exclusive to those who are tech savvy.

In 2025, countries that have yet to embrace instant payments will be forced to partner with players in the industry that can support and provide the technology in order to do so – as a result of regulation or competition. Inclusivity and accessibility is the way forward in 2025

Walmart’s Sarah Arnio said at a panel at the AFP conference this year that “ubiquity is important for a corporate. For us to be able to promote this, even internally, to make the developers implement this, if you’re only reaching 50% of accounts, it’s not enough. A company like Walmart needs to be able to reach 95% of Americans at least, and that’s an issue. We’re at a tipping point where the majority cannot be reached through Faster Payment networks. When you think about the technology adoption curve, you have the early innovators, the early adopters, and I think we’re still ramping up to early adoption because a big chunk of us are in the ’let’s wait and see’ bucket.”

Quantum computing          

What comes after generative AI? Some are saying quantum computing. The G7 Cyber Expert Group (CEG), chaired by the US Department of the Treasury and the Bank of England, found that the potential cybersecurity risks associated with developments in quantum computing must be addressed. In line with this, financial institutions must ensure that they understand the ability of these superfast computers and leverage cryptographic encryption mechanisms to protect customer data and IT systems.

The National Institute of Standards and Technology (Nist) released an initial set of quantum-resilient encryption standards, but financial institutions must prepare to be as agile as possible so that new encryption standards and technologies can be incorporated.

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This content has been selected, created and edited by the Finextra editorial team based upon its relevance and interest to our community.