NMI 2025 Predictions: AI Will Transform Fintech

This Will Be the Year AI Makes Payments Disappear

AI has the potential to create smoother, safer, “invisible” payments experiences. However, there is also a risk that this technology will actually make people less loyal, disrupting the traditional relationship between retailers and consumers by allowing people to conduct better research and try things out virtually before buying. Because Gen Z places the quality of experiences above brand loyalty, they won’t hesitate to abandon a merchant that doesn’t offer the payment journey they expect.

More than 9 out of 10 consumers made a digital payment in 2023, marking a historic shift in consumer payment preferences. Estimates indicate that by 2027, more than 94% of payments in the United States and 89% of global point-of-sale (POS) payments will be cashless.

Consumers of all ages are tired of carrying around outdated payment methods. Already, 85% of Gen Z consumers and 82% of Millennials prefer using contactless digital payment methods over traditional alternatives. However, younger demographics aren’t the only tech-savvy consumers anymore.

Although the rate of digital payment use (such as digital wallets) is lower among older generations, Baby Boomers, in particular, are increasingly adopting modern technologies. A greater comfort with personal devices combined with the fast, seamless digital experiences in other areas of our daily lives will lead to consumers of all ages becoming more comfortable with (and inevitably demanding) tech-forward shopping and purchasing options.

I believe AI will play a significant role in this shift, making it possible for businesses to offer truly invisible payment solutions to customers in 2025. 

Additionally, in 2025, I believe that AI-powered personal financial managers, or AI “agents,” will help consumers better organize their spending habits and keep an eye on how and where they make purchases. With AI agents handling a majority of transactions (including purchases and returns) on our behalf, we will truly move closer to an environment where payments happen entirely in the background.

In 2025, AI Will Drive Hyper-Personalization

Personalization is key to creating a great payment experience. Targeted messaging and recommendations build trust, while personalized payment options ensure customers can always pay how they prefer. This is where artificial intelligence comes in. Combing through shopping histories and behavioral data takes time, so much so that it would be impossible to offer a personalized experience to every visitor without the help of advanced systems. Thankfully, AI can turn in-depth analytics into actionable insights businesses can use to meet shoppers’ expectations.

AI’s ability to quickly ingest and analyze large amounts of data and turn it into actionable insights has already made waves in the payments industry, and we’re regularly seeing news showcasing its potential. 

While the industry has made significant strides there’s still room to unlock AI’s full capabilities in areas including fraud detection and hyper-personalization. From customizing discount offers at checkout to automatically recommending the best payment method, AI-based personalization has the potential to significantly improve the quality of the payments experience for both consumers and merchants. That means happier customers, more return business and, with better offer tailoring, higher average ticket prices.

While there’s still a long way to go before we get anywhere near the full potential of AI in payments, I think 2025 will be the year we see it start seeing it become a mission-critical tool instead of just a novelty. 

For more of my predictions on the evolution of AI in payments, as well as valuable insights from my executive team, take a look at our report, “From Frictionless to Future-Ready: NMI’s Payment Trends & Predictions for 2025.”