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The Role of Payment Innovation Companies in Developing Countries
The rise of e-commerce and m-commerce has given way to new payment methods changing the payments landscape significantly.
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CIO Applications | Monday, December 03, 2018

The rise of e-commerce and m-commerce has given way to new payment methods changing the payments landscape significantly. Many developed countries are replacing older payment methods such as checks and payment on delivery are replaced by more modern and advanced payment methods such as e-wallets, in-app purchasing, and peer-to-peer payments. Digital portion of global retail sales will double from $1.9 trillion to $4 trillion by 2020, and this is excluding travelling industry.
With international e-commerce platforms and sophisticated payment platforms, barriers of e-commerce are crumbling, giving way to new businesses and opening up new revenue streams for established players, driving technology advancements, and facilitating economic trade. Growth fueled e-commerce market continues to become global and the forms consumers use to pay for their digital and physical goods will evolve continually.
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Tech giants are involved in cross-border business and providing worldwide services are tasked with deploying their services on top of old and fragmented payment infrastructures. The payment methods may seem similar on the surface, but the behind the scenes may be entirely different because each country has its legal framework, acquirers, gateways, and processors. These geographical and demographical differences present a real challenge for tech companies.
In growing markets, alternative payment methods like bank transfers, voucher-based methods involving cash, and installments are still prevalent. Incorporating hundreds of payment methods that work in tandem with the technology systems and operations is always a challenge in growing markets. These challenges have brought a lot of new payment and FinTech companies in developing markets. These companies are the ones that are powering a new breed of content companies, marketplaces, and ad networks with API-based payment solutions.
To expand in growing markets, e-commerce and digital goods companies are partnering with new payment companies. While selecting payment technology partners for emerging markets there a few to keep in mind such as complete understanding of the local nuances and banking infrastructure, robust and flexible technology stacked into one platform, and in-depth knowledge of local laws and risks as well as capacity to assure compliance and avoid fraud.
With evolving technology, consumer needs are also changing. Merchants and payment providers will meet these challenging needs to gain sturdier footing. Additionally, country governments will also play a subsequent role in welcoming cross-border e-commerce and digital payment innovation.
As technologies evolve, the number of branded payment apps that are coupled with loyalty programs will increase in number. Tech giants and search engines will incorporate in-browser payments while social media entities will introduce e-commerce platforms and payment mechanisms in the app.
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