Payments Modernization Starts and Ends With Customer Preferences
Innovation in payments is rarely linear, but it is always impactful.
That’s because staying ahead of the curve within payments and commerce often involves an interplay of technological advancements, regulatory changes, shifting consumer behaviors and competitive pressures.
Industry leaders are pioneering marketplace transformations by leveraging technology and responding to shifting consumer preferences.
“Payments modernization is all about optimizing and streamlining … but you can’t just make things streamlined. You have to ensure it is secure as well,” Justin Downey, vice president of product at Maverick, told PYMNTS for the series “What’s Next in Payments: Payments Modernization.”
He highlighted the increasing demand for speed and efficiency, particularly among younger generations, like Generation Z. These consumers expect instantaneous transactions with minimal obstacles, a demand that pushes payment processors to innovate continuously.
And to stay abreast of changing customer preferences and technological advancements, payments companies are finding that leveraging a strong technology foundation is crucial to solving for emergent business needs.
Adapting to Customer Preferences
Downey noted that his company’s strategy involves a significant degree of customization for their partners.
By offering white-label solutions, Maverick Payments allows partners to brand the technology as their own, thereby focusing on sales while Maverick handles the technological backbone. This approach enables agents and software vendors to connect and integrate seamlessly with Maverick’s infrastructure, ultimately supporting merchants more effectively.
“Everybody wants to streamline the checkout process. That’s what is driving payments,” he said. “If you create too many hurdles in the checkout process, you might lose the payment.”
“Business that can adapt to very convenient ways for customers to pay are going to win in the long run … so staying on top of offerings for a streamlined payment and checkout approach is a heavy focus,” Downey added.
The rise of digital wallets and other alternative payment methods exemplifies this trend toward a more streamlined path to purchase.
Data also plays a pivotal role in modern payment systems, particularly in fraud prevention. Downey discussed the importance of using data to combat various types of fraud, including the increasingly common “friendly fraud.”
By integrating tools that provide more detailed transaction data, merchants can reduce instances of chargebacks and protect their revenue. Separately, Downey advised merchants to focus on actionable insights derived from data to enhance their overall business operations.
Leveraging Strategic Investments
When advising merchants on budgeting for payment modernization, Downey made sure to stress the importance of focusing on core business areas rather than attempting to be a jack of all trades.
He suggested that businesses should concentrate on their primary revenue drivers and leverage partnerships to enhance their offerings. This strategic approach enables companies to maintain a competitive edge without overextending their resources.
“Anything that makes processes quicker and easier with less obstacles for customers, that’s where the excitement is,” Downey said.
But when it comes to the innovation du jour, artificial intelligence (AI), which is transforming workflows and helping firms capture new efficiencies across more than just payments, Downey cautions against rushing full speed ahead into the unproven technology.
Currently, AI is used to streamline processes and automate certain tasks, enhancing efficiency within organizations. Looking to the future, Downey explained he is excited about AI’s potential to revolutionize coding and integrations, though he acknowledged that this is a longer-term development.
“In the long run, AI can speed up any development, working in products,” he predicted, highlighting the ongoing evolution in this space.
Asked what he sees on the horizon, Downey reiterated that customization and partnerships are key to achieving a streamlined payment ecosystem.
Embracing a collaborative approach ensures that both businesses and their payments partners grow together, leveraging each other’s strengths to deliver superior payment solutions.
“You have to find the right partners and do your due diligence, and make sure that whatever APIs [application programming interfaces] you are integrating have the offerings that you need,” Downey said, adding that while Maverick Payments is focused to build a comprehensive payment stack for businesses to sit on top of, “ultimately, we sit behind the scenes and grow along with our partners.”
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