Best Consulting WordPress Theme $69 $29

View Now
Skip to content Skip to sidebar Skip to footer

Top Use Cases of Blockchain in Payments

Blockchain in Payments

The global market value for blockchain use in the banking sector is expected to reach $22.5 billion in 2026 from $0.28 in 2018. The growing adaptation of blockchain in facilitating payments in several use cases has contributed significantly to the market value, and it goes to show how drawn to the technology people are becoming every day. 

Blockchain developers are fully booked as companies seek to enjoy the benefits of blockchain app development services. There are plenty of blockchain platforms for businesses to choose from to incorporate in their payment systems. 

Moreover, the role of blockchain in accelerating payments in different domains has endeared it to business owners and customers for reasons such as robust security, transparent transactions, fast transactions, fraud and chargeback detection, fewer processing fees, etc. 

Many companies in the financial sectors that have blockchain in accelerating and streamlining payments include Barclays, BBVA, Visa, PayPal, Banco Santander, ING Bank, and many more.  The most common blockchain in payment use cases include cross-border payments, charitable donations, cryptocurrency payments, insurance payouts, and more. 

There are more blockchain in payments use cases you are probably unaware of, but that should be the least of your worries because they are discussed in this guide.

7 Use Cases of Blockchain in Payments and Accompanying Benefits

With no central authorities to govern blockchain-based payment systems, businesses and users can finally benefit from its decentralized and corrupt-free feature, in addition to improved security, cost-effective fund transfers, and accountability. Fortunately, you can apply blockchain solutions in most sectors and business functions. 

For a comprehensive picture of how blockchain has revolutionized payment systems, below is a list of blockchain in payments use cases, including how each benefits the users and businesses. 

  • E-commerce Payments

The acceptance of blockchain payments in e-commerce is gaining traction worldwide, helping address bottlenecks usually associated with traditional payment systems. eCommerce mainly relies on building trust between the seller and the buyer, and blockchain involvement in the field helps foster lasting trust by enabling secure payments. 

Buyers can trust blockchain-powered eCommerce platforms with their hard-earned money without fearing tampering by hackers. Buyers also enjoy reduced fees when making payments, which is not primarily the case when paying via traditional banks, which charge higher. Customer privacy is also upheld; buyers can track payment status and shipment in real-time.

  • Digital Identity

Digital payments are prone to fraud and identity theft. Securing and verifying identities is an integral step in making online payments, and blockchain has proved reliable in storing digital identities in a tamper-proof ledger that cannot be manipulated. Blockchain records are immutable and, thus, hard to compromise by editing or deleting. This reliability is further enhanced by smart contract development, ensuring that all transactions are executed precisely as programmed without any possibility of fraud or interference.

Businesses can verify their customers’ identity in effortless KYC procedures by integrating blockchain into their payment system, keeping fraudulent activities that can lower customer trust at bay. The smart contracts innovation in blockchain also plays a significant role in upholding identity verification by enforcing contracts only after involved parties meet the predefined terms and conditions. 

  • Invoice Financing

Another use case of blockchain in payments is that businesses can reduce the hassle of obtaining invoice financing from third-party banking institutions or investors by introducing blockchain to the financing process. Entrepreneurs can improve their invoice financing by relying on blockchain’s immutability and smart contract features to protect payments from unauthorized parties. 

Invoice records are hard to tamper with once recorded in a blockchain network and are only accessible to verified participants. Automating invoice financing also plays a critical role in cutting costs since intermediaries are not involved. 

Also, through blockchain adaptation for invoice financing, businesses can tokenize their invoices, allowing more investors to own fractions of the invoice, thus increasing liquidity. 

  • Subscription Services

Most businesses offering their services through a subscription-based model can leverage blockchain for benefits such as improved efficiency, security, and transparency. Users can pay for services or products using digital coins or tokens without worrying about the safety of the transactions. 

Blockchain’s smart contracts aid in reducing potential billing disputes since the agreements are written in code, making altering them difficult. Implementing blockchain in payments also gives businesses an advantage in rewarding their customers through a loyalty program, a crucial move in achieving customer retention. 

On the transparency issue, customers can access their payment history as stored in the ledger and exercise control over their records. Content creators are other beneficiaries of blockchain in payments, enabling them to receive fair and deserved compensation based on subscriptions and other parameters. 

  • Point of Sale Systems

Fast payment settlements, security, and transparency are consistent benefits of blockchain in payments, which also apply to POS systems. Retail businesses, among other sectors that offer POS-based services, can mitigate fraud by relying on blockchain’s capability to secure POS systems, which is crucial in building long-term trust in customers, suppliers, manufacturers, and other stakeholders. 

Blockchain is also essential in managing loyalty programs at POS, enabling customers to redeem their hard-earned points for approved rewards. Businesses can also automate POS processes, which are necessary in facilitating automatic payments based on pre-agreed terms and conditions. 

  • Remittances

Remittances revolve around transferring funds from migrant workers to their loved ones back home to help them meet their financial obligations. For the longest time, migrant workers relied on traditional banking institutions to send funds to their families, processes prone to delays, higher transaction charges, and fraud, among other issues. 

With blockchain adaptation in remittances, there are no intermediaries, and workers can enjoy fast fund transfers, which is essential in dealing with emergencies back in their home country. The involvement of blockchain in remittances also significantly reduces anti-money laundering because reliable remittance companies comply with KYC (Know Your Customer) regulations. 


Bottom Line

Transparency, cost-effective, and secure payments could be your way of receiving or transferring funds if you embrace blockchain. Since blockchain payments have proven effective across all industries, you should not waste time contacting a blockchain expert for help navigating the technology. An expert will determine if your system is compatible with available blockchain payment solutions and then suggest a qualified option depending on your business size, budget, and goals. 

For the Updates

Exploring ideas at the intersection of design, code, and technology. Subscribe to our newsletter and always be aware of all the latest updates.

Leave a comment

Download a Free Theme