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18 PAYMENT-MARKET EVOLUTION EXPLAINED Although it has faced challenges related to COVID-19, the payments market is quickly evolving, according to industry insiders. Marius Galdikas, CEO at ConnectPay, a fintech company, notes that factors including Banking-as-a-Service, the pursuit of regula- tion, less reliance on third-parties, enhanced biometrics, and increased flexibility are likely to have the most impact on the payments mar- ket into 2021. He proceeds to detail the effects of trends in payments: Employing Banking-as-a-Service, or BaaS: is mode allows any company to embed financial services, enabling the organization to focus on product innovation rather than infrastructure development. "[at's] because the required banking stack can be integrated via API-driven platforms. Sometimes referred to as embedded finance, the service creates an opportunity for any tech company to become a fintech in a shortened timeframe," Galdikas said. Embedded finance paves the way for creat- ing financial products without needing to start from scratch, he adds. "As the interest in BaaS continues to grow, it could help tech companies gain a significant advantage against their competitors." Market players seek more regulation: ose companies operating within under-reg- ulated sectors recently have started appealing to policymakers to increase regulation, Galdi- kas says, citing the crypto industry. "Having a clearly defined regulatory framework would help industries current- ly viewed as more ambiguous to position themselves as reliable allies and pave the way for stronger partnerships with other market players. Not to mention it would help to di- minish associations with fraudulent activities, reassuring current and potential clients," Galdikas said. Decreasing third-party reliance: Compa- nies of late have been compelled to reevaluate the risks of having third-party suppliers, Galdakas notes, citing data breaches due to external vendor vulnerability, as well as a few incidents that called into question their reliability in general. Payment providers these days seek solutions that would help "take matters into their own hands … move more operations in-house, and lessen dependency on any intermediaries," he added. "Setting up capable in-house solutions allows companies to retain more transactional control and increase overall fund security, as fewer parties are involved in the payment process." Enhanced use of biometrics: e ability to confirm the buyer's identity and approve transactions through face, fingerprint, and palm recognition is another rising trend in the market that Galdikis expects to evolve in coming months and years. "All payment services in-use could be secured by a single personal feature. It would make the entire process faster," he said. "Moreover, this provides an extra layer of security, as personal features are harder to replicate by scammers." He pointed out that a recent study revealed that 56% of shoppers would prefer using a biometric sensor instead of a PIN to make a payment, "hinting at the increasing appeal of such solutions for consumers as well." More flexibility: Providers in today's mar- ket are doing everything possible to mitigate pandemic-related concerns, Galdikis says, which includes offering flexible solutions. "For example, major market players, such as PayPal and Chase, have entered the 'buy-now-pay-lat- er market,' which gives customers the option to pay off a purchase over a period with zero-in- terest and fixed-rate monthly installments," he said. e move toward flexibility encompasses not only such delayed payment options but also the rise of new payment platforms. As one example, he noted that "Google is laying the groundwork for Plex, a mobile-first bank account integrated into GooglePay." e point of the evaluation, Galdikis said is that consumer needs are ever evolving, and the pandemic has greatly influenced which aspects have become more important in the past few months. "With a fair amount of uncertainty expect- ed to carry over to next year," he said, "this is only the beginning of novel solutions, designed to adapt to consumers' changing habits." Journal