14 top stories in fintech and payments in 2022

We took a look through our “Last week, today” bi-weekly fintech and payments news roundups for the year, and some key themes and stories emerged. Here are the 15 biggest things that happened in (or to) payments and fintech this year.

1. Russia is unplugged from the global financial structure. The war in Ukraine continues and so do its ripple effects globally. Unfathomable resilience has made President Volodymyr Zelenskyy and "the spirit of Ukraine" Time magazine's Person of the Year for 2022. A recently released OECD forecast projects Russia’s economy will contract by 5.6% in 2023, according to the Washington Post. Moves over the past year to swiftly unplug Russia from the world’s financial infrastructure are a big part of that.
2. Open banking moves ahead in the U.S. Europe is leading the way on open banking – where now 10-11% (up from 6-7% a year ago) of digitally-enabled consumers are using at least one open banking service, according to the Open Banking Report. And in the U.S., after another year of starts and stops, it looks like the Consumer Financial Protection Bureau (CFPB) will move ahead with writing rules for Section 1033 of the Dodd-Frank Act. The guidance is meant to make it easier for consumers to switch financial services providers, by requiring banks or fintechs to share that data with other providers when consumers ask them to.
3. Embedded finance’s next stop is B2B payments. There’s much agreement on the bigness of embedded finance to business – and the next big use case being around B2B payments. Financial institutions surveyed by PYMNTS named payment processing, credit cards and loans as places they’re looking to innovate with embedded financing experiences – and there are many applicable use cases to choose from, according to 451 Research.
4. Strong security gets attention. Just 43.4% of organizations maintain full PCI DSS compliance – but that’s a big improvement over just 27.9% in 2019, according to Verizon’s 2022 Payment Security Report. That said, compliance will get tougher as organizations prepare for deadlines set in PCI DSS v4.0. More evidence of the benefits of strong security measures comes from the UK, where online payment fraud declined on the heels of mandatory SCA requirements.
5. Check, please? The answer is increasingly ‘no thank you.’ Digital payment methods are becoming more popular in paper-heavy process holdouts, from higher education to high tech. Microsoft told its North American partners they could no longer pay by check from Dec. 1 on. It’s not hard to see why. AFP says it costs $1 to $2 to receive a check, vs. 26 to 50 cents for an ACH transaction. The firm’s 2022 Digital Payments survey saw check use decline to an all-time low – to just 33% of B2B payments made in the U.S. and Canada. Checks are losing their luster in education as well. Flywire’s partnership with Ascensus this year to digitize 529 disbursements helped many universities achieve massive efficiencies and improvements in the user experience.
6. Finance eyes automating, integrating more of the receivables process. Finance automation was big in 2022 (for many good examples, see the Wall Street Journal's series on how major companies approach it) to drive efficiencies. Finance executives continue to name digital transformation among their top concerns, as they look to save on labor and make up for increases from inflation. That’s leading to more collaboration between the IT department and finance. But no one wants that data in different systems. Integrating new payment functionality with systems of record continues to be a project priority – for EHRs in healthcare, Student Information Systems in Education, ERP systems in the business and booking systems in travel.
7. Cross-border payments are a growth and efficiency driver, but they can still be tough for people and businesses. It was a strong year for cross-border payments on a lot of different fronts. Loosened and dropped COVID restrictions made for a banner year for international travel. What’s more, interest in international education surged again, with student enrollment in places like the U.S. and the UK back to pre-pandemic levels, and recovering in other key international markets.
  
  B2B payments make up 80% of cross-border payments, and companies are eying gains to be made there. As our survey of CFOs showed, there are still many efficiencies to be had with the right payments partner. 95% of the CFOs we surveyed this past spring said that their companies could increase global expansion efforts if they had an easier way to deal with exchange rates. 88% said collecting cross-border payments impacts their ability to grow.
8. Experiences over things, and exchange rates’ impact on travel. For the card networks, cross-border payments were an earnings star. People continue to prefer experiences over things, and for U.S. travelers, the strong dollar made this year a great time to travel overseas. Luxury travel was back in full force – with Flywire’s data showing travelers planned to spend more than ever before.
9. A strong year for fintech and payments innovation in Latin America. Argentina wasn’t the only big winner from Latin America this year (and speaking of which, the World Cup provided quite the showcase for new payments tech). With the growth of Pix, Brazil was among the countries with the most real-time transactions in the world and a key region for fintech partnerships. Fintech cross-border payments providers continued to expand reach into the region, driven by a high unbanked population that is increasingly digital and open to mobile banking.
10. Big tech continues to court (or try to build its own) fintech. Examples abound of the push and pull between fintech and big tech companies. Here are a few. Bloomberg reported in March that Apple was working to develop its own payment processing technology and infrastructure for new financial products. Google and Match reached an agreement in May to provide some choice when it came to billing systems, and later in the year announced expanded choice for developers of non-gaming apps in India, Australia, Indonesia, Japan and the European Economic Area. Instagram embedded payments within its user interface, with Meta saying it aimed to “help people start conversations with businesses they care about…in an easy, seamless experience…”
11. Card networks get a look from regulators the world over. Visa and Mastercard increased merchant fees in the spring, a planned increase that they stalled during the last two years of the pandemic. Fees are catching the eyes of regulators. The UK Payment Systems Regulator detailed plans in June that look at scheme and processing fees, and cross-border interchange fees. Bi-partisan legislation introduced in the U.S. Senate in July aims to promote competition among the card networks by mandating that merchants can route most payments through rails not affiliated with the card used to pay. Major retailers including Walmart and Target came out in support of the bill – which is now in Committee.
12. Affordability issues persist across healthcare, education. Providing accessible ways for consumers to pay is a critical part of solving affordability challenges in higher education and healthcare – where innovators are seeing great success with offering payment plans and easing the collection processes. There were several big news stories this year that demonstrated just how widespread this affordability issue is.
  
  For instance, the three major credit reporting bureaus in the U.S. announced they’d remove medical debts that had been paid off from credit reports. And starting in 2023, all unpaid medical debts up to $500 won’t appear on them at all. The two changes, the Wall Street Journal reported, will remove 70% of the $88 billion in medical debt that’s on the credit reports of 43 million Americans. And the Biden administration’s continued push to forgive a certain amount of federal student loan debt for many people is now in the hands of the Supreme Court, which is expected to have a decision on whether the executive order is constitutional by June.
13. The year ESG became strategic. Fortune said that in 2022, ESG went from ‘nice to have’ for businesses to influencing corporate strategy. ESG policies, procedures and controls, and evidence of compliance were important for fintech. BDO said that “among investors, the social factors of ESG will continue to grow in importance, with more attention to diversity and social justice.” Flywire released its inaugural ESG report in December.
14. Strong year for women in finance and fintech. For the first time, U.S. currency has the signatures of two women finance leaders– Treasury Secretary Janet Yellen and Treasurer Chief Lynn Malerba, who is also the first Native American to serve as treasurer. And Flywire has plenty of trailblazers to highlight this year as well. Flywire CIO and CISO Barbara Cousins was named one of the Top 25 Women Leaders in Fintech, Senior Director, Global Payments Emily Watson was honored as one of the Most Influential Women in Payments, and Flywire CMO Allison MacLeod shared her leadership advice at Money 20/20, one of the biggest stages for global payments. Flywire's Allie Figures, Laura Ladd, Aimee Schumaker and Sam Mackowitz were each featured in trade publications for their leadership and subject matter expertise. And Flywire landed a spot on the Comparably Best Companies for Women (Large Companies).