Payment rails have connected businesses and individuals for centuries. However, much has changed since the days of walking into a bank and sitting across from a clerk in a pinstriped suit to make a payment—and even more change is on the horizon.

In fact, according to the World Payments Report 2025 by Capgemini Research Institute for Financial Services, by 2028, at least 32% of global transactions will be completed via instant payments, e-money, and direct debits. This reshaping of financial services both drives and responds to an ecosystem where cost, speed, and availability are paramount, with fewer pauses and boundaries—creating significant opportunities for businesses and consumers.

Why embrace digital payments

Real-time payments enable funds to be transferred instantly between parties, bypassing delays caused by traditional banking hours or intermediaries. Unlike standard bank transfers that can take hours or days, payments settle in seconds or minutes. Digital payments not only offer enhanced security through encryption and authentication protocols but also integrate seamlessly into websites, mobile apps, and point-of-sale systems, helping to provide a smooth and effortless experience for customers.

No business wants to fall behind in e-commerce growth, tapping into new global customer bases, and gaining insights from consumer behavior data, which digital payments can deliver. Clearly, businesses and financial institutions should embrace digital payments to stay competitive, improve customer experience, reduce costs, and adapt to a rapidly changing financial ecosystem. By integrating secure, fast, and convenient digital payment solutions, businesses not only meet customer expectations but also position themselves for growth in a more globalized, digital-first economy.

The role of AI technology

AI-driven fraud models will expand to better account for consumers' digital identities and personalized spending insights, thereby addressing increasingly sophisticated fraud. However, vigilance remains necessary regarding how AI-driven scams will impact the payments landscape. The rise of generative AI (GenAI) technologies enables fraudsters to execute more sophisticated and scalable scams against vulnerable businesses. Deloitte's Center for Financial Services predicts that by 2027, GenAI could drive U.S. fraud losses to $40 billion.

Strategic implications

The strategic implications for liquidity management, global commerce, and business efficiency have sounded an alarm for traditional banks. Meanwhile, fintechs and technology providers continue to innovate, enabling straight-through processing and integration of instant payments into business applications such as ERP systems.

Banks may need to consider a multi-rail strategy—exploring the possibilities that instant payment services could offer while maintaining a firm grip on existing global payment revenue infrastructure. As Sébastien Delasnerie, Executive Vice President of Commercial Cards at Mastercard, stated in Taulia's virtual card report: "Access to liquidity and working capital is critical for companies of all sizes, especially smaller ones." He added: "Faster payments will bring greater certainty, enabling businesses to optimize working capital while also reducing reliance on other forms of credit to fund operations."

Regulators have been driving instant payments, such as the EU requiring European banks to comply with the SEPA Instant Credit Transfer scheme. This ensures that euro-denominated instant payments can be sent and received within 10 seconds, prompting a growing number of companies to consider modernizing their payment landscape to leverage these opportunities.

Digital currencies will undoubtedly also play a greater role in the future, as they can operate around the clock and are virtually borderless, with significantly lower costs.

Decentralized ledgers: a look ahead

Traditional finance (TradFi) refers to the infrastructure underpinning most financial transactions today—banking, lending, investing, and payments—characterized by centralized control and regulation. In contrast, decentralized finance (DeFi) removes third-party "intermediaries," employing blockchain-based peer-to-peer systems that enable users to transact directly with one another—without banks.

Blockchain technology is the backbone of this shift, as it provides a decentralized ledger that records transactions securely and transparently. Arguably, it is fundamentally changing financial transactions, not only eliminating intermediaries but also streamlining payment processes, reducing transaction costs, and minimizing settlement delays.

Indeed, blockchain's growth in the banking and financial services market is rapid, rising from $6.98 billion in 2024 to $10.85 billion in 2025, a compound annual growth rate (CAGR) of 55.3%. This growth is driven by demand for real-time transfers, digital banking, and government initiatives. It is projected to reach $40.9 billion by 2029, with a CAGR of 39.4%.

Many businesses welcome the possibility of integrating blockchain technology to enhance visibility into their global cash flows and increase transparency into transaction status and routing. However, it is crucial that these processes and their related workflows integrate seamlessly into existing systems to avoid creating silos that lead to inefficiencies. Such inefficiencies would undermine treasurers' efforts to maintain a unified view of liquidity and associated foreign exchange risk.

This shift toward these new payment methods is largely focused on international transactions, which can be time-consuming and costly under the TradFi system. Therefore, stablecoins—built on blockchain networks and pegged to the value of stable assets to maintain a fixed value and reduce volatility—can be a practical choice for cross-border payments. Meanwhile, central bank digital currencies (CBDCs)—digital forms of a country's fiat currency, supported by central regulated banking systems—offer an alternative to private digital currencies or cryptocurrencies.

Undoubtedly, the payments landscape is evolving for the better. Are you ready?

In ourNext-Generation PaymentseBook, learn how to optimize working capital, enhance cash flow visibility, and leverage cutting-edge payment solutions, recently published by SAP Taulia.