What's on the Horizon for Payments and Fintech in 2022? Keep an eye on the trends that are most relevant to you and your business, but don't ignore the big picture.

As most industries continue to navigate the challenges of Covid-19, the payments and fintech sector is vitally connected to the recovery. Some emerging trends can help you make educated decisions about where to take your own company in the upcoming year.

Plastic is dead

Credit card companies have been operating for many years. The average American carries four pieces of plastic in his or her wallet or purse. The foundation for that operation has been constructing connection points or rails between the different points of a transaction. For example, when you swipe a credit card at a point-of-sale machine, communication happens between the card company, the POS system and the bank to verify that the money is in your account and to pay the merchant. So although credit card companies are viewed as brands, they're also sophisticated technological networks with infrastructure in place that supports the exchange of funds.

Now, though, other players, such as digital wallets and cryptocurrency, are coming onto the stage. These ways of paying are becoming increasingly popular because they make it easier to keep secure records of the transaction and help facilitate direct person-to-person money transfers. The evolution of contactless payments has reduced the need for plastic cards; many people have come to prefer digital alternatives. To survive in the face of this new competition, credit card companies must devise creative ways to tap their existing infrastructure.

Related: Why Businesses Need to Embrace the Digital Payments Now

Digital is king

Even though most people have some type of bank account, the number of people that don't is still significant. In fact, 6% of American households — 14.1 million adults — are unbanked. For these individuals, alternative digital options, such as cryptocurrency, are helping bridge both the ability to store value and, increasingly, the payment gap that currently exists. Additionally, countries around the world occasionally choose to devalue their currencies as a way to gain an edge in trade and reduce sovereign debt. Digital currencies allow people to have a broader, more uniform way of exchanging funds and operate on more equal terms.

Both of these factors mean that through digital, business leaders can attract more customers in the same way. So awareness of what the customer experience is like becomes more important because what you choose to do can have a more significant impact. But because digital democratizes and levels the payment playing field, token-based commerce will continue to spread and gain dominance.

Related: The Ins and Outs of Modern Payment Processing

Everyone is a fintech (but the most convenient ones win)

Many companies don't consider themselves to be "fintech" businesses. But the reality is that every business is a payments company. Roku, Macy's, DoorDash, Uber — no matter the name, they all have to accept payment from their customers in some way for their company to work.

Within this, though, is the streamlining of the process. Companies are figuring out how to make their digital transactions as convenient and efficient for the customer as possible. For example, at Starbucks and a number of other QSR's, the emphasis is on "order ahead" mobile experience where your order, payment and pick-up availability are all completed before you arrive at the store with little to no wait time. Businesses that eliminate inconveniences for buyers in these ways are likely to impress customers and see more sales.

Online shopping becomes immersive

One of the advantages of online shopping is that you can consider many different options for what you want to buy. The downside of that, however, is that you are potentially faced with dozens or even hundreds of search results to comb through, which is time-consuming, even on a great, well-laid-out site.

In this context, companies are recognizing the power of customized experience and a more traditional boutique feel. So even though they're not discouraging the use of their sites, per se, they are trying to accommodate shoppers in more immersive ways. As a personal example, when I recently connected with a representative at a store, he offered to Facetime with me so I could browse the store as if I were there with him, even though the store had a website. With advances in AI, VR and similar technologies, such immersive interactions are becoming easier for companies to offer in ways that suit shoppers' preferences. They can allow people to try out products virtually while getting basic information.

Retail comes back to life

Through the pandemic, much of online business was based on demand rather than desire — that is, many people purchased items on websites simply because they couldn't go in person or were bored, not necessarily because they actually preferred to go digital. And as the major companies like Walmart and Amazon scrambled to keep up with each other, it grew increasingly difficult to differentiate meaningfully among them.

Although many will continue to use online shopping more than they would have if the pandemic hadn't hit, people also are realizing that shopping is more of a social experience than a buying experience. Even little touches like what the store puts by the register make a difference in making people feel comfortable and getting them to engage, and those things really cannot be imitated online. As retailers begin to recover, both small businesses and major businesses alike are going to embrace this reality and explore more ways to create that social experience again. The new retail will become more frictionless, contactless and interpersonally connected.

Related: What the Evolution of Contactless Payments Means for You

For the biggest steps forward, examine all the trends through a broad lens

Virtually all the above trends intersect with each other. For instance, the social experience of shopping can be more enjoyable and personal when shoppers need not negotiate as many inconveniences or steps through the transaction or when representatives use immersive strategies customized to what shoppers want. In the same way, if digital currencies make it easier for people to shop, then more people will be candidates for a renewed retail experience.

Keep an eye on the trend that's most relevant to you, but have a sense of the big picture, and don't ignore the other transformations that are happening. With a well-rounded understanding of how these points are interwoven, you'll stay ahead of the curve.