Strategic Discussion on Real-Time, Robust, and AI-Compatible Payments with Nihit Ahuja from Volante Technologies and Delphine Emenyonu from TSB
In a rapidly evolving global market, the payments landscape is undergoing significant transformation, driven by technological innovation, regulatory changes, and evolving consumer expectations. Nihit Ahuja from Volante Technologies and Delphine Emenyonu at TSB discuss the current state and future trends across several key areas.
## ISO 20022
ISO 20022, a global standard for high-value payment systems and financial messaging, is becoming increasingly prevalent. It enables richer, more structured data exchanges between financial institutions, improving automation, compliance, and reconciliation. Major market infrastructures like SWIFT, Fedwire, and TARGET2 are migrating or have migrated to ISO 20022, with ongoing adoption in cross-border and domestic payments.
Looking ahead, adoption will continue to expand, especially as real-time systems and cross-border networks integrate ISO 20022 messaging. This will enable better fraud detection, improved liquidity management, and more detailed analytics, supporting open banking and regulatory compliance.
## Real-Time Payment Systems
Real-time payments (RTP) are scaling rapidly, with systems like UPI (India), FedNow (U.S.), Faster Payments (U.K.), and PIX (Brazil) processing billions of transactions. These systems offer instant fund transfers, available 24/7, dramatically improving payment speed and convenience for consumers and businesses.
The value of transactions processed via RTP is expected to surge by 289% from 2023 to 2030. Expansion is driven by demand for frictionless, automated payments and the need for businesses to manage cash flows more efficiently. Interoperability between domestic and cross-border RTP networks will be a strategic priority.
## Digital Currencies
Central Bank Digital Currencies (CBDCs) are in various stages of research and pilot testing worldwide. Stablecoins, powered by blockchain technology, are increasingly used for cross-border payments, remittances, and supplier payments by FinTechs and established financial institutions.
Expect continued development and deployment of CBDCs as countries seek to modernize monetary systems. Stablecoins and institutional blockchain networks will become mainstream for cross-border and B2B payments, offering lower costs, higher speed, and transparency.
## AI Services in Payments
Artificial Intelligence (AI) and Machine Learning (ML) are fundamental to fraud detection, risk management, and customer service in payments. AI powers chatbots, predictive analytics, and personalized financial recommendations. Investment in AI by FinTech is projected to rise from $12 billion in 2023 to $62 billion by 2032.
The integration of "agentic AI" will accelerate, enabling more autonomous, context-aware financial services. AI-driven orchestration will streamline regulatory compliance, automate currency conversion, and enhance fraud prevention.
## Biometric Security
Biometric authentication (fingerprint, facial recognition, voice) is increasingly embedded in payment apps and devices, providing secure and convenient user verification. Biometrics are becoming a standard feature in digital wallets and banking apps.
Wider adoption of biometrics will continue, especially as regulatory requirements for strong customer authentication (SCA) increase. Multimodal biometrics and liveness detection will further enhance security and reduce fraud.
## Open Banking
Open banking, enabled by regulatory frameworks like PSD2 in Europe and similar initiatives globally, allows third-party providers to access financial data (with user consent) to offer innovative services such as account aggregation, personal finance management, and instant payments.
Open banking will expand, fostering more competition and innovation. Expect broader use cases, including embedded finance (financing within non-financial platforms) and "glocal" payment solutions that adapt to local needs while maintaining global interoperability.
## Fraud Detection
Rising digital e-skimming and scam activity has made advanced fraud detection a top priority. Financial institutions and payment providers are deploying AI-powered, fusion intelligence systems to detect and prevent fraud in real time.
AI and ML will continue to lead fraud prevention, with predictive models and behavioral analytics becoming more sophisticated. Integration with real-time payment networks will enable instant fraud detection and automated blocking of suspicious transactions, reducing losses and improving consumer trust.
In summary, the future of payment systems is shaped by integration (of standards, real-time networks, and digital currencies), intelligence (AI and ML-driven security and automation), and inclusivity (open banking and biometric security), with a strong emphasis on speed, security, and user-centric experiences. Emenyonu mentions that voice recognition can now be used for verification in the payments sector, and improvements in the payments sector are crucial due to the growing importance of seamless customer experience. Banks are faced with the challenge of updating their operations to accommodate these changes while also adhering to regulatory compliance within local regions.
[1] Ahuja, N. (2023). The Future of Payments: Integration, Intelligence, and Inclusivity. PaymentsJournal. [2] Emenyonu, D. (2023). The Payments Ecosystem: Adapting to Change and Innovation. BankingTech. [3] World Payments Report 2023 (2023). Capgemini and BNP Paribas. [4] The Evolution of Real-Time Payments (2023). The Clearing House.
ffnews.com might feature an article discussing the impact of biometric security on the payments industry, as biometric authentication becomes a standard feature in digital wallets and banking apps.
In the realm of business, finance, and technology, the growth of AI services in payments, such as fraud detection, risk management, and customer service, is anticipated to escalate, with investment in AI by FinTech expected to rise significantly over the next decade.
