‘Say goodbye to the bi-weekly pay cycle’: Payments predictions for 2022 (Part 1)

  • For this series on payments predictions for the coming year, Tearsheet asked over 20 experts to share insights on upcoming payments trends in 2022.
  • Key topics covered include B2B payments, cross-border money transfers, embedded finance, on-demand pay, virtual cards, stablecoins, digital wallets, P2P payments, and more.

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‘Say goodbye to the bi-weekly pay cycle’: Payments predictions for 2022 (Part 1)

This is the first part of a three-part series on the most important upcoming trends in payments. Part 1 covers embedded finance, cross-border payments and on-demand pay, while part 2 looks at the digitization of B2B payments, the growth of stablecoins, and the virtual card boom. Finally, part 3 explores digital wallets, P2P payments, and cybersecurity. For more updates on all things payments, subscribe to our Payments newsletter here.

The payments industry has experienced some major shifts this year, catapulted by the pandemic-induced move towards digitization. With 2022 almost here, we asked 22 experts from across the payments spectrum to predict what trends we can expect from the industry in the coming year. 

A number of themes stood out as particularly relevant for 2022. Here’s what the experts say you should look out for as we head into the new year.

The increasing role of embedded finance

One of the major trends expected for the next year and beyond is the emergence of more embedded finance solutions onto the market – in consumer payments, and increasingly in the B2B payments space as well.

“It's about ease, really. Those wanting to buy something – whether outright or via point of sale financing – want a seamless experience using the technology they are most comfortable with and that they use in their day-to-day or professional lives. That equates to a huge potential market for any brand wanting to offer payment solutions directly, and with minimum friction, to their customers – whether that's through a streaming provider, retail shopping app, or enterprise software solution.

However, it's also worth highlighting that businesses like Galileo, who provide the backend engineering that enables brands to offer these embedded payments, also have to keep evolving and disrupting their own sector in order to ensure the above-the-glass user experience can continue to innovate at pace and scale. It's another form of growth in the payments sector, but a critical part as well.”

- Derek White, CEO of Galileo Financial Technologies

“As technology advances at increasing speed, the infrastructure for development of new payment methods is more accessible than ever. I believe we’ll soon start to see brands in every industry become fintechs by developing their own card offerings, each with their own distinct and unique benefits designed to build and reward customer loyalty for their brand.”

Brian Dammeir, president – North America at Adyen

“Despite innovations across consumer payments, small businesses continue to be underserved by the lack of a seamless, end-to-end payments ecosystem. As we close out 2021, we’ve reached a precipice where small businesses are expecting more from their payments providers as many are still struggling to manage getting paid. Heading into the new year, I’m confident fintech will continue to lead in applying embedded finance to create new payments experiences that are designed to be even more intuitive and relevant, delivering faster and truly integrated offerings that speed up the movement of funds between vendors, customers, and employees.”

- Rob Daniel, director, product management at Intuit QuickBooks

“In the coming year, the continued growth of embedded finance will allow B2B payments to meet the customer where they want to be met. For example, users in finance operations today have to deal with multiple point solutions such as ERP, invoice automation, procurement software, point solution for international payments, and more. Increasingly, we will see the rise of payments being embedded in customers’ choice of software.”

- Gunita Bindra, vp product management & partnerships at Bottomline Technologies

“New industries will evolve and break into the financial services realm with the increased use of embedded finance. More and more companies will seek to partner with local banks in order to provide “embedded” banking services, particularly payments. Embedded finance allows for greater personalization. This was not a possibility five to seven years ago, but has changed due to more democratized software behind payments and banking systems, lower costs, and a greater ability to branch out with emerging technology.”

Ahon Sarkar, general manager at Q2


Easier cross-border payments

In a recent study, Wise found that over one in three (34%) small business decision makers in the US operates internationally. A growing number of individuals and businesses are working across borders, emphasizing the need to make international money transfers as quick and easy as possible. 

“US banks and fintechs don’t have the option to just think domestically anymore. The banking ecosystem has evolved to a place where there is no longer a single place to manage all of your finances. Consumers are turning to different platforms to meet their very specific needs, but lack cohesive solutions that work together in the ways customers need them. 

Looking ahead, we expect to see more partnership integrations via API that allow companies to bring highly demanded experiences – like moving money across international borders to friends and family or to facilitate key commercial exchanges – closer to their customers while focusing on their existing specialties. Doing so will bring stronger offerings to consumers that meet a wide variety of their needs.”

Lindsey Grossman, director of product, North America at Wise

“There is a huge opportunity in the next few years to build on the progress made in digitizing remittances, which has proven to be a lifeline for migrant workers who send money home to their families. Collaboration across private and public sectors will remain critical to eliminate barriers and empower a faster, cost-effective and ultimately more inclusive payments ecosystem globally, which could help elevate national GDPs and reduce global poverty.”

Ruben Salazar, global head of Visa Direct

“Historically, banks were seen as custodians of cross-border payments, but that’s not the case anymore. We’re now seeing an increase in comfort with cross-border payments conducted outside the bank. There has been a surge in companies paying vendors through third-party platforms, which offer much faster and more cost-effective payment solutions. The need for instant, low-cost payments channels will further accelerate this transition in 2022.”

Karim Ben-Jaafar, president & COO at Beanworks

“In the coming year, ecommerce and cross-border payments will remain the fastest growing areas within payments. The volume of ecommerce transactions was approximately $4 trillion in 2020, and cross-border payments are the fastest growing segment within ecommerce, projected to increase from $800 billion in 2019 to $4.8 trillion by 2026 (27% CAGR). Both are benefiting from strong growth trends as evolving merchant and cross-border complexities present new challenges and consumers increasingly become more global in their purchasing behaviors.”

Rob Anderson, partner at FTV Capital

“Smoother cross-border payments will be the key to maximizing ecommerce growth. The trend of rapid ecommerce acceleration will continue as growing populations in international regions (particularly China and Southeast Asia) gain access to 5G. This will open retailers to billions of new ecommerce shoppers in the next decade. To stay ahead, retailers will need to adjust strategies to focus on selling to new, global markets.”

Eric Christensen, chief payments officer at Digital River

The end of “payday” as we know it

As opposed to the traditional monthly or fortnightly pay cycle, on-demand pay is rapidly gaining traction as it allows workers to get faster access to the money they’ve already earned – approximately $1 trillion that’s locked up in payroll systems across the US and several other leading economies on any given day.

“2021 was the year of BNPL – every payments company was looking at how to help consumers smooth out their expenditures over time. In 2022, we’ll see the focus shift to the other side of that coin – technologies that are changing the way we earn money and smooth out our earnings over time. Both of these solutions are highly complementary and can unlock new modes of managing our money.

With the historic shift in the balance of power between workers and employers currently underway, get ready to say goodbye to the traditional bi-weekly pay cycle. Soon, every day (and even every hour) could be payday, as you will have the ability to automatically “stream” your earnings to pay for the things most important to you – whether it’s saving for a rainy day, or paying for the new Peloton bike that you’ve opted to split over time. 2022 will be the year that we put even more tools in the hands of consumers to take control over their financial lives, and employers will be at the center of it.”

Seth Ross, gm, Dayforce Wallet & consumer services at Ceridian

“Companies are increasingly adopting new technologies to provide workers with fast access to earned wages instead of following the traditional two-week pay cycle. While the earned wage access (EWA) trend first took off in the gig space, we think EWA will soon revolutionize the entire payroll space. Given its long-term potential, EWA will continue expanding into new use cases, especially as antiquated methods like cash and checks fall to the wayside. EWA has already begun to transform payroll for salaried employees when it comes to cycle payments or bonuses. Looking ahead, employers of all types will continue investing in and prioritizing offerings to enable faster access to funds in order to better attract and retain the workforce of the future.”  

Ruben Salazar, global head of Visa Direct

“With the development and recent adoption of early paydays, workers can now customize when they get paid. Large financial institutions are starting to adopt early direct deposit features, creating a pipeline for a new, younger generation of customers that want flexibility, convenience, and financial freedoms. Look for an increased adoption of this technology over the next year as a tech-savvy generation pushes financial institutions to innovate their business and product offerings.”

- Jeff Kump, head of payments at CSG Forte

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