Payments Testing - March 19, 2024
Payments has long been one of the most dynamic, disrupted and challenging domains within the financial services industry. That’s why digital transformation is a critical element for organizations that want to keep up with shifting consumer behavior, improve operational efficiency and retain their competitive edge.
So, aside from implementing modern payment testing systems that automate their testing and QA processes, what technological innovations should financial service organizations consider as they look toward the future?
To give you a better idea of some of today’s top trending technologies we take a look at Gartner’s recently announced Top Ten Strategic Technology Trends for 2023.
These concepts and technologies, when applied correctly, can help businesses to reduce costs, improve their margins and to reinvest into the right areas of their business to better encourage growth.
In this blog, we summarize the 10 strategic technology trends announced by Gartner and where they fit into the payments industry, either now or in the future.
1 - Digital Immune System
A digital immune system is the combination of multiple software engineering strategies, such as observability, automation and extreme testing, to enhance the customer experience while protecting against operational and security risk. Gartner predicts that, by 2025, organizations that invest in digital immunity will increase end-user satisfaction with applications that are more accessible and deliver a stronger user experience.
For payments: Organizations in the financial services industry can use test automation to ensure their payment systems are safe, secure and always available whenever and wherever customers want to transact.
2 - Applied Observability
Applied observability is the use of artificial intelligence (AI) to analyze and make recommendations on data generated by an organization in order to make faster and more accurate business decisions. Gartner notes observable data is an organization’s “most precious monetizable asset.”
For payments: Financial services companies, and payment processors in particular throw off huge amounts of data. Any technologies that can be utilized to turn the data into actionable insights will help an organization to optimize their operation, improve both the quality and security of their products and services, while at the same time innovate to continually deliver a superior customer experience.
3 - AI Trust, Risk and Security Management (AI TRiSM)
AI TRiSM are the processes and technology used to secure AI applications and services, as well as ensure AI is used securely and ethically. Gartner says that, by 2026, companies that operationalize AI TRiSM will see AI models achieve 50 percent result improvements in terms of adoption, business goals and user acceptance.
For payments: Keeping our financial systems secure has never been more important or more difficult. Leveraging technologies like AI can help organizations improve security and fight fraud, while at the same time reducing friction and ensuring that the payment systems are still easily accessible for consumers.
4 - Industry Cloud Platforms
Industry-specific cloud platforms will drive agility, speed to innovation and accelerated time to value for organizations, according to Gartner. A combination of SaaS, PaaS, IaaS with tailored, industry-specific functionality will help businesses to adapt to the relentless stream of disruption in their industry.
For payments: Due to complexity and security concerns, many banks and other financial services organizations were slow to get started with cloud deployments. Across the payments industry today, many companies are now aggressively moving their processing and payments testing assets into the cloud in order to increase agility, improve scale, and reduce infrastructure costs.
5 - Platform Engineering
Gartner defines Platform Engineering as a “curated set of tools, capabilities and processes that are packaged for easy consumption by developers and end users. The goal is a frictionless, self-service developer experience that offers the right capabilities to enable developers and others to produce valuable software with as little overhead as possible.”
For payments: Since all modern financial services companies are driven by their IT capabilities, any advances in technology that help developers to create, deliver and maintain software assets more quickly and efficiently will have a significant impact on both customer satisfaction and the bottom line.
6 - Wireless-Value Realization
According to Gartner, the next-generation of wireless technologies are ready to deliver new and improved services, such as location tracking, vehicle-to-vehicle communications, broadcast, multicast and media-specific features, that will improve operational efficiency while reducing infrastructure costs.
For payments: Evolving wireless technologies will enable the faster, more secure and more cost effective communications necessary to support initiatives like the Internet of Things (IoT), which has the potential to drive massive change across the payments industry.
7 - Superapps
Superapps combine the features of an app, a platform and an ecosystem in one application, providing a platform for third parties to develop and publish their own miniapps on. Gartner predicts that more than 50 percent of the global population will be daily active users of multiple superapps by 2027.
For payments: Super apps are designed to be convenient and easy to use, especially when it comes to payments. Many banks and retailers are already using Superapps to help consumers consolidate all of their financial transactions and interactions all into one simple to manage interface.
8 - Adaptive AI
According to Gartner, Adaptive AI (Skynet?) “allows for model behavior change post-deployment by using real-time feedback, to continuously retrain models and learn within runtime and development environments, based on new data and adjusted goals, to adapt quickly to changing real-world circumstances.”
For payments: This capability is especially relevant to the payments industry where both consumer behavior and fraud are continually evolving across billions of transactions and trillions of dollars every year. Gartner predicts that enterprises that adopt AI engineering practices to build and manage adaptive AI systems will outperform their peers in the operationalizing AI models by at least 25 percent.
9 - Metaverse
Not just a modern buzzword, the metaverse is a way for people to replicate or enhance their physical activities by transporting them to a “virtual world”. Gartner predicts that by 2027, over 40 percent of large organizations worldwide will be using Web3, spatial computing, and digital twins to increase revenue through metaverse-based projects.
For payments: There are already many opportunities for people to acquire and pay for “virtual assets” in popular games like Fortnite, Call of Duty, or Roblox. The virtual gaming industry is already worth more than $12 billion annually, with a CAGR of more than 25 percent. The ongoing buzz around the Metaverse, along with other technologies, like Next Gen wireless, will only serve to accelerate this trend.
10 - Sustainable Technology
Gartner describes sustainable technology as a framework of solutions that increase the energy and efficiency of IT services; enabling enterprise sustainability through technologies like traceability, analytics, emissions management software and AI; and helps customers achieve their own sustainability objectives.
For payments: As stated at the very beginning of this post, the payment industry is, and will continue to be, dynamic, disruptive and challenging. In order for organizations to survive and thrive, they need to continually focus on improving both organizational and operational efficiency. This means using data to make faster and better decisions, acquiring and retaining the best talent and reducing their corporate footprint on planet earth.
Interested in learning more about how streamlining, automating and integrating your testing capabilities can help your organization optimize operations and achieve its strategic goals? Reach out to the Paragon Application Systems team today and learn how our technology can improve your payment testing processes.
