A recent survey by payabl. has revealed that digital wallets and Open Banking will play a central role in shaping the payments industry by 2025.

According to the findings, 81% of merchants expect digital wallet usage to increase significantly, while 69% foresee growing adoption of Open Banking and instant bank transfers. These trends are being driven by rising consumer demand for secure and convenient payment solutions. Merchants also anticipate other payment methods gaining traction, including QR code payments (33%), Buy Now, Pay Later (BNPL) options (25%), cryptocurrencies (21%), and central bank digital currencies (CBDCs) (11%).

Merchants are focusing on technology to address payment challenges and enhance agility. Over the next year, 65% of respondents plan to invest in artificial intelligence (AI) to improve fraud detection and payment performance. Additionally, 56% aim to leverage data analytics for insights into payment behaviours, while 38% prioritize API-based solutions to boost flexibility and security within payment ecosystems.

The survey also sheds light on the industry’s key challenges. Fraud prevention emerged as the top concern, cited by 63% of merchants, followed closely by regulatory compliance at 60%. Cybersecurity risks (46%), integrating new technologies such as AI (44%), and managing cross-border payments (10%) were also highlighted.

Beyond security and compliance, merchants identified customer experience optimisation (32%) and cost management (25%) as critical areas to address in the coming year. With the 9 January 2025 deadline for SEPA Instant payments approaching, readiness across the industry remains a concern. Only 25% of merchants believe the sector will be fully prepared to support instant payments by the deadline.

The report underscores the importance of coordinated efforts between regulatory authorities, financial institutions, and merchants to ensure a seamless transition. Trends transforming the payments sector The survey highlights instant payments as the most transformative trend in the payments landscape, with 57% of merchants identifying it as having the greatest impact on the industry. Other significant developments include regulatory changes such as PSD3 and anti-authorised push payment (APP) fraud rules (50%), and the integration of AI and machine learning (44%).

Open Banking (35%), BNPL (27%), and cross-border payments (25%) are also shaping the sector, while cryptocurrencies and digital assets are gradually gaining attention, with 19% acknowledging their influence. Emerging areas such as Embedded Finance (13%) and sustainable payment solutions (8%) are beginning to make their mark. For more information about payabl., please check out their detailed profile in our dedicated, industry-specific Company Database.

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