This article was first published on Insights – Ripple
In the evolution of digital payments, it’s clear that financial institutions and payment providers will continue to adopt blockchain technology to drive real-time, cross-border payments growth. This digital ledger infrastructure, which integrates with bank accounts, digital wallets and even cash payout channels will become the engine to provide the convenience, speed, ease of access, transparency and trust demanded by today’s businesses and consumers.
The adoption of cryptocurrencies (which has surpassed $1T in value as a “digital asset” class and has matured well beyond the early years of negative connotations) is poised to eliminate friction and become the lubricant to accelerate the transformation of the $1.9T global payments market.
Therefore, we anticipate these key trends igniting a state of hyper-growth for digital payments globally, in 2021and beyond:
Paper Money Is Still a Mainstay
When we take a step back and look at the bigger picture, it’s evident that cash is still king. However, as cash continues to hold steady, digital payments will continue to grow.
Even pre-COVID – somewhat ironically, cash has been the core enabler of digital growth. For example, the top cross-border payment companies report that cash accounts for more than 80% of all transactions, and only a small subset of total transactions is purely digital.
Despite our world growing more virtual by the day, the majority of consumers still crave and value access to physical cash. When asked what features were important when choosing a primary bank or deposit account, 70% of consumers named “convenient, fee-free access to cash through an ATM.”
Interestingly, though, it is this access to cash that will help digital wallets become a consumer’s primary financial service provider. 31% of people would start using a new financial service provider if they also provided free ATM access.
Accelerated Adoption ...
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Insights – Ripple