The payments industry is undergoing a rapid transformation, with technological innovations like tap-to-pay, blockchain integration, and generative AI shaping its future, according to payments giant Mastercard.

The company on Thursday released a report identifying ten global trends that will define the payments landscape in 2025.

“By 2030, Mastercard envisions a world where electronic transactions can occur without the need for card numbers or passwords,” the company said.

This ambitious goal is to be achieved by leveraging tokenisation, biometric verification, and digital wallets like Click to Pay.

“The aim is to make transactions not only simpler but also safer and more efficient for consumers and businesses alike,” the company explained.

One major trend is the growing role of artificial intelligence (AI) in combating fraud. As cybercriminals use generative AI to create realistic phishing scams and fraudulent videos, Mastercard has developed solutions to counteract these threats.

“With our Decision Intelligence Pro solution, we can analyse one trillion data points in just 50 milliseconds,” the company said.

This capability enhances fraud protection by 300 per cent, demonstrating how AI can act as both a threat and a defence mechanism.

Moreover, the company reported that small businesses are at the forefront of these changes.

“Small enterprises that adopted digital tools during the pandemic were able not only to survive but also to grow,” Mastercard said.

Now, such businesses have access to a suite of solutions that automate administrative tasks, personalise marketing campaigns, and support strategic decision-making based on data insights.

“Specialised platforms allow small businesses to increase productivity and strengthen customer loyalty,” the company explained.

Elsewhere, peoples’ digital identity and security are becoming a key aspect of the digital economy.

Mastercard predicts that by 2025, traditional passwords will largely be replaced by biometric passkeys.

“Digital identity is emerging as a cornerstone of the digital economy, enhancing both security and convenience,” Mastercard stated.

It highlighted the importance of these technologies in sectors like healthcare and public services, ensuring privacy while improving accessibility.

Moreover, digital wallets are seeing unprecedented adoption, particularly in emerging markets.

“In these regions, digital wallets are increasingly replacing bank accounts,” Mastercard said.

Its Pay Local service, available in Asia, allows users to link credit and debit cards to local wallets, enabling seamless transactions without preloaded balances.

“In the future, digital wallets will evolve into integrated platforms combining payments, identity, rewards, and healthcare services,” the company stated.

Contactless payments are also redefining the checkout experience. “Over two-thirds of in-store transactions in Mastercard’s network are now contactless,” the company revealed.

Technologies like Tap on Phone allow any device to act as a payment terminal, speeding up checkout processes and reducing wait times.

In the business-to-business (B2B) sector, digital payments are becoming more streamlined.

“Virtual cards now enable automated reconciliation, real-time expense tracking, and fraud prevention,” Mastercard said.

These advancements are expected to drive the value of integrated financial solutions for small businesses beyond $124 billion by 2025.

The rise of real-time payment systems is another game-changer, the report revealed.

Currently available in over 100 countries, such systems simplify transactions with features like interoperability and data-rich exchanges.

“By 2028, real-time payments are expected to account for 27 per cent of global digital transactions,” Mastercard stated, underlining the need for cross-border payment solutions to enhance efficiency and security.

The company also mentioned out that collaboration is crucial to these developments.

“The rapid evolution of technology demands partnerships between financial institutions, businesses, governments, and fintechs,” Mastercard said.

It pointed out that fintech companies play a vital role in expanding access to financial services, fostering trust, and driving digital innovation.

The adoption of blockchain technology is also advancing, moving from theoretical applications to practical use cases.

“Blockchain is set to improve speed, security, and efficiency in B2B and trade payments by 2025,” Mastercard stated.

It added that strategic partnerships would be key to harnessing the full potential of blockchain in delivering secure and scalable solutions.

Lastly, the company explained that tokenisation is revolutionising payment security by replacing sensitive data with encrypted tokens.

“The token economy ensures millions of payments annually by protecting personal and financial information,” Mastercard said.

According to the report, the company aims to eliminate manual card data entry by 2030, along with facilitating in-car payments and expanding token applications to areas like asset management through blockchain.

“Payments are no longer just transactions; they are a gateway to a more connected and efficient digital economy,” Mastercard concluded.