One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity.
The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.
In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment.
Most commonly the basis of exchange involves fiat currency or legal tender, be it in the form of cash, credit or bank transfers, debit, or checks.
While typically associated with cash transfers, payments can also be made in anything of perceived value, be it stock or bartering – though this is far more limited today than it has been in the past.
The Largest Players in the Payments Industry
For most individuals, the payments industry is dominated currently by card companies such as Visa or Mastercard, which facilitate the use of credit or debit expenditures.
More recently, this industry has seen the rise of Peer-to-Peer (P2P) payments services, which have gained tremendous traction in Europe, the United States, and Asia, among other continents.
One of the biggest parameters for payments is timing, which looms as a crucial element for execution.
By this metric, consumer demand incentivizes technology that prioritizes the fastest payment execution.
This can help explain the preference for debit and credit payments overtaking check or money orders, which in previous decades were much more commonly utilized.
A multi-billion-dollar industry, the payments space has seen some of the most innovation and advances in recent years as companies look to push contactless technology with faster execution times.