Digital wallets have become one of the predominant methods of payment for users all across the globe, but can their capabilities reach further heights when it comes to being more compatible with traditional methods? 

In part two of BPC’s 2025 predictions, four executives at the digital banking platform outlined four key facets of the payment economy that will reshape the industry and unearth new developments that will impact how consumers interact with payments.

Read part one here

Digital Payments

Adoption of digital payments continues to accelerate, driven by trends like embedded finance, virtual cards, and real-time reconciliation tools. Digital wallets are increasingly encroaching on the territory of bank accounts, allowing for cashless transactions and addressing unbanked populations in underserved regions. 

While these wallets are capturing the majority of consumers and businesses by offering simple, convenient, and affordable solutions, a critical challenge remains: connecting traditional, card-based payments for international consumers. Bridging this gap is essential as digital wallets become the cornerstone of global financial ecosystems.

A notable shift is underway from closed-loop wallets, which operate within a single ecosystem, to open-loop wallets. Open-loop wallets are interoperable, allowing users to transact seamlessly across multiple merchants and even countries by leveraging global payment networks like Visa, Mastercard, or UnionPay. These wallets enable P2P transactions, cross-border payments, and even utility bill settlements, making them increasingly valuable in an interconnected world. 

Imran Vilcassim

This evolution signifies a move beyond transactions toward creating meaningful digital experiences that add value for consumers, merchants, and financial institutions alike.

While businesses may debate where AI will make the fastest inroads, most agree it will significantly enhance the functionality of digital wallets. Wallets are already popular, allowing cashless transactions from smartphones and other devices. 5.2 billion people, or more than 60% of the global population, are expected to use digital wallets by 2026, a substantial rise from 3.4 billion in 2022.

Imran Vilcassim, CCO of Global Digital Platforms at BPC, shared: “A profound transformation is ongoing in digital payments. The transition from closed-loop to open-loop wallets is reshaping the industry, enabling consumers to transact effortlessly across ecosystems, regions, and services. 

“Merchants are also joining the bandwagon of digitisation, where digitisation is not just about digital payment acceptance but also about running businesses digitally. Digital payments are no longer just about facilitating transactions; they are evolving into meaningful digital experiences that create value for consumers, merchants, and financial institutions alike.”

Cross-Border Payments

Cross-border transactions are undergoing a fundamental transformation as globalisation reshapes consumer and business payment behaviours. Historically, these transactions were dominated by traditional banks, characterised by inefficiencies, high costs, and lack of transparency. 

Today, cross-border payment solutions are becoming faster, more cost-effective, and increasingly accessible to consumers and SMEs alike. By 2025, RTPs are expected to revolutionise global commerce, enabling instant, low-cost transactions both domestically and across borders. Real-time cross-border networks are changing the game, providing cost-effective, seamless transactions and enabling growth in regions like Southeast Asia.

Jonathan Bautista

Jonathan Bautista, Commercial Director, APAC Region at BPC, noted: “The rise of cross-border payment networks, including European TARGET, PayNow-PromptPay in Southeast Asia, or DuitNow, US FedNow and a couple of others, are critical to driving sustainable growth. 

“Widespread adoption of cross-border payment could significantly lower the barriers for international trade, making it easier for smaller businesses and individuals to participate in the global economy. Real-time cross-border payment systems offer not just efficiency but also security and transparency, which are essential elements that foster growth and trust, particularly in developing regions such as Southeast Asia. 

“While significant progress is expected, full global interoperability of cross-border payment networks is still a complex challenge due to regulatory differences, technical standards, and varying levels of adoption in different countries. Overall, the evolution of cross-border payments appears poised to enhance global commerce significantly in the coming years”

Artificial Intelligence

AI is becoming indispensable in payments, powering risk management, fraud detection, financial consulting, and customer support. Generative AI, in particular, is making significant advancements across multiple domains, enabling smarter recommendation systems, virtual assistants, and automated decision-making processes.

Oleg Patsianskiy

Oleg Patsianskiy, Head of Artificial Intelligence Laboratory at BPC, explained: “AI is redefining how payments are managed globally. From document automation and fraud detection to personalised client scoring and 24/7 virtual support, AI’s applications are vast and transformative. 

“Generative AI technology has propelled advancements in customer engagement, providing faster, more accurate solutions to complex challenges. As we move into 2025, AI will play an even more pivotal role in streamlining payment systems and improving financial services.”

Instant Payments

Instant payments have already transformed the global payments landscape, enabling faster, seamless, and low-cost transactions. By 2028, instant payments are projected to account for 22% of all non-cash transaction volumes, with the market expected to surpass $30trn in volume.

This growth is fueled by their ability to integrate domestic and cross-border schemes, enhancing interoperability and bridging gaps between traditional and digital payment systems. Additionally, instant payments are expected to drive innovations across industries, from enabling faster loan underwriting through real-time data analytics to transforming invoicing and cash management with electronic presentment models.

Irfan Ahmed

Irfan Ahmed, Regional Business Solutions Director at BPC, shared: “In 2025, instant payments will continue transforming global commerce, offering instant, low-cost transactions across borders. 

“Real-time payment schemes as key to enabling innovations like faster loan disbursement through alternative scoring models and better cash management with automatic reconciliation. Driven by consumer demand and supported by partnerships with central banks, RTPs will become the global standard, bridging payment networks across Asia, Africa, the US, and Europe, reducing reliance on intermediaries but also promoting financial inclusion and creating new revenue streams for financial institutions.”