Top 5 Digital Payment Trends for 2023

Recent developments such as Covid-19 have reshaped the payments landscape, driving digital acceleration and changing how consumers and retailers interact.
January 12, 2023 | Expertise

Recent developments such as Covid-19 have radically reshaped the payments landscape, driving digital acceleration and changing how both consumers and retailers interact. With this in mind, we take a look at the top 5 trends for 2023.

1 - Rise of Alternative Payment Methods

We have seen a rise in the number of alternative payment methods (APMs) over the past years. These provide an alternative to traditional methods like credit cards, and include digital wallets, open banking, mobile payments and cryptocurrencies.

The proliferation of these methods brings with it a number of challenges. Consumer preferences tend to differ strongly by region (e.g. Paypal in Europe/US and WeChat Pay in China), while payment service providers (PSPs) typically only focus on a small subset of countries and payment methods. For merchants active in multiple markets who want to cater to regional preferences, this invariably means relying on multiple PSPs. This in turn leads to additional implementation and maintenance costs in order to provide broad coverage of APMs in line with regional market expectations.

As demand for APMs grows and payment methods such as open banking become more and more commonplace, merchants are increasingly turning to solutions that unify multiple PSPs and APMs via a single API. This offers far more flexibility to merchants, making it easier to integrate new payment methods as demand emerges and consumer preferences change.

2 - Safety in a Volatile Market

One of the lessons many merchants have learned the hard way is that the payments market can be highly volatile, and that there can be severe risks associated with the reliance on a single payment provider without fallback options. The average PSP or orchestration platform has a short lifetime, with acquisitions frequent in the industry. Many companies find it hard to turn a profit, which encourages investors to sell unprofitable businesses to recoup their initial investment. Conversely, acquiring existing merchant portfolios is an extremely attractive proposition for established PSPs looking to expand, providing a deep pool of potential buyers. The net result is that the payments market is in a constant state of flux - payment providers frequently change hands or go out of business.

This can represent a significant risk to merchants, especially those reliant on a single payment provider. Should that PSP go out of business, this can leave merchants in a position where they are completely unable to handle payments - the demise of Wirecard being a prime example of this. Similarly, if the merchant’s PSP is acquired by another vendor, the new owner may not want to continue doing business with merchants in certain verticals or whose transaction volume is below a specific threshold. This can necessitate looking for an alternative solution at short notice.

These risks underline the importance of fallback options as a cornerstone of their merchants’ risk management policies. No business wants to be in a situation where they need to find a replacement service overnight through circumstances outside their control.

One way for merchants to manage these risks is by using a payment orchestration platform such as IXOPAY. A payment orchestration platform supports multiple PSPs, making it easy to put fallback options in place and to switch to an alternative provider if circumstances change. Given the potential economic cost associated with the inability to conduct business and handle payments, the trend towards solutions that mitigate these risks is only set to strengthen in future.

3 - Need to Cater to a Global Market

Merchants selling digital goods and services can easily offer their products to a global audience via the internet - anyone with internet access is a potential customer, no matter where they are located. Similarly, multinationals operate in a wide variety of markets across the globe. In both cases, there is a clear need to process payments from customers in a multitude of regions. 

Given the differences in relevant legislation between countries, the payments market is heavily fragmented, with payment providers generally concentrating on a core market. Even the largest providers find keeping up with evolving regulations across multiple markets a challenge.

Merchants meanwhile need to cater to regional preferences while looking to keep down costs - typically by using local service providers who tend to offer more attractive rates. As a result, globally active merchants often rely on a patchwork of providers to meet these needs. While a certain amount of consolidation can be expected going forwards, this geographic fragmentation is unlikely to end any time soon due to the legal complexity involved. This is another factor driving demand for payment orchestration platforms that provide a single access point to multiple, geographically dispersed payment providers and methods.

4 - Digital Acceleration

The Covid-19 pandemic saw a huge increase in online business, accelerating the transition to cashless payments. Consumers drastically changed their shopping habits, forcing traditional brick and mortar merchants to overhaul the way they conduct business. For many, this meant rapidly switching to online or hybrid (e.g. click and collect) sales models within a very short space of time.

Now that many of these businesses have successfully pivoted to a new model, and cashless payment has become widely accepted by many consumers, this approach is now the new normal. Those businesses who have not yet fully transitioned will undoubtedly step up their efforts to do so. The next few years should see more and more traditional retailers fully embrace digital payments in one form or another as consumers have come to expect this option.

5 - Unbundling the Technical Implementation from the Transfer of Funds

Payment orchestration is becoming a new buzzword. Many traditional PSPs are co-opting the term, while RFPs from merchants often specify payment orchestration as a key requirement. On a fundamental level, payment orchestration is the unbundling of the technical implementation of payments from the process of actually transferring funds.

A payment orchestration platform such as IXOPAY offers a single API that merchants can use to integrate any number of different PSPs. These platforms offer features such as cascading, meaning merchants can easily provide fallback options or switch from one PSP to another as needed. These solutions offer several advantages: additional flexibility, reducing the overheads required to integrate additional PSPs and significantly cutting the risks inherent in relying on a single PSP. This trend towards payment orchestration will only continue as merchants look to future-proof their payments ecosystem. PSPs will still continue to play an important role, handling the actual transfer of funds between buyer and seller, while merchants are free to choose to route transactions through the PSP that best caters to a specific market.


Overall, we are seeing a trend towards additional flexibility, better risk management and an enhanced user experience. Important lessons have been learned about the risks of market upheaval in the wake of the Covid-19 pandemic or the Wirecard scandal. Merchants looking to reduce these risks are increasingly turning to reliable partners who offer the flexibility of fallback options, multiple payment methods and global market access. Payment orchestration tackles these challenges head on, making it easy to implement a robust and flexible payment strategy that is future-proof.


IXOPAY is a payments orchestration platform enabling independent, flexible and global payment processing. As a highly scalable and PCI-DSS certified “fintech enabler”, IXOPAY fulfills the needs of large merchants as well as those of “white label” clients: payment service providers (PSPs), acquirers and independent sales organizations (ISOs). The modern, easily extendable architecture offers smart transaction routing and cascading, state-of-the-art risk and fraud management, fully automated reconciliation and settlements processing, comprehensive reporting as well as plugin-based integration of acquirers, payment service providers and alternative payment methods (APMs).

IXOPAY is part of the IXOLIT Group, founded in Vienna, Austria in 2001. With local entities in Austria and the USA, IXOLIT supports national and international customers across various industry verticals. The owner-led and -financed company has grown from 2 to more than 80 employees and is focused on building innovative solutions for eCommerce.

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