The industrial setup is changing quite rapidly, to be honest. Since the pandemic, consumers and retailers have been obsessed with selling goods online, increasing the value proposition of eCommerce channels. The general growth of online stores has irrevocably led to a complete transformation for the online payment processing industry. Business owners are keenly looking at payment processing trends and ways to allow seamless and smooth payment completion.
If statistics are believed, the global digital payment industry is expected to hit $6.6 trillion in value in 2021. Before the pandemic, the industry was growing at a 16% YOY increase, but since the pandemic, this rate has accelerated to over 22%. The digital payments market is set to cross $10.5 trillion in value in the next four years. This staunch growth results from the need to cater to this new-fangled and evolved consumer demand to purchase products online- from luxury to specialty goods and daily needs and the rapid tech advancements. It is why businesses must analyse the different payment trends, identify the ones related to their vertical, and explore ways to adapt to them.
That said, the following are some payment processing trends that will help you enjoy the best of both the markets- consumer and industrial.
Trend #1: A rapid rise in innovative payment portals
With everything going around in the world, people are trying to save as much cash as possible and opt for contactless payments, wherever and whenever they can. Approx. 67% of the US retailers now accept at least one or the other form of contactless payments. Not only this, but as per researchers, UAE recorded 100% growth in contactless payments than the previous year.
As a result, there is a related boom in the near-field communication technology that powers contactless payments. It allows users to wave or simply tap their smartphones on the best credit card machines to complete a purchase. Not only this, but in the coming time, even devices like smartwatches and smart speakers will allow users to execute payments similar to debit and credit cards. Tech giants like Apple, Google Pay, and Samsung already have their respective contactless payments engineered for consumers.
Trend #2: A focus on more robust security
As digital payments continue to rise, it is essential to focus on security. Everything on the web can quickly become a cybersecurity threat. As one of the prominent digital payment processing trends, several payment companies will improve their existing cybersecurity framework. And when they do so, they will incorporate AI and ML into their payment systems.
Additionally, customer authentication (CA) will also become critical to mobile payment processing trends. CA will add another layer of security to the payments and, along with facial recognition, biometric and voice-enabled transactions will transform digital payments into a robust process.
Trend #3: integrated payments to improve the checkout experience
As the popularity of eCommerce channels rises, so does the number of digital payment trends. There was a time when merchants and financial services were different and not connected. Today, merchants are integrating several popular payment providers into their platforms.
The idea of providing integrated payments is to offer a seamless checkout experience to customers. And a significant chunk of that experience goes into integrating the right payment providers into their web and mobile solution. When customers buy something online, they expect everything to be a part of the purchase and won’t like going through extra steps. With activated payment initiation services (PIS) on an eCommerce platform, it will link a customer’s bank via an open API and execute transactions post-consent.
Such digital payment processing trends involving third-party integrated payments will escalate in the coming times.
Trend #4: The evolution of mobile payments
As a part of the mobile payment processing trends, mobile wallet technology is being increasingly adopted by consumers. Trillion-dollar companies like Apple, Samsung, and Google have already launched their mobile wallet technology, and consumers can direct payments to such portals in one click.
As per experts, mobile payment volume will reach an estimated $503 billion. Considering its rising potential, merchants accept mobile payments to add robustness and seamlessness to their payment processes.
Trend #5: Buy now and pay later (BOPIS) solutions
The consumer market consists of Gen Z, Millennials, and Gen X populations. And there is a particular consumer segment gravitating towards alternative payment trends like buy now, pay later solutions. Such processes allow consumers to buy a product online but pay for it in instalments. Retailers like this payment method because it frees up the space on their racks and encourages consumers to purchase products they like and pay for them in a manner they prefer. Several payment providers empower customers to opt for such payment methods and avail a comfortable and easy purchasing process.
Trend #6: P2P payments redefined
The pandemic has accelerated the adoption of P2P payment, with tech-savvy millennials and older generations all riding the boat. Platforms like PayPal and Razorpay have grown tremendously, registering the highest average transaction volumes since the pandemic hit us. Many of such service providers also provide investment and trading, cryptocurrency-based transactions, and debit card payments. With P2P payments providers like such, nobody needs to go to the bank. However, the next step is to expand their offerings, offer cross-border eCommerce payments, and increase their ROIs.
Trend #7: The transformation of invoicing procedures
Invoicing is a crucial component of B2B, B2C, and DTC payments. Statistics reveal that invoices are evolving towards a digital picture. Several enterprises are adopting automated online payment processing systems to increase accuracy, speed and save money. Almost any process can be automated, including invoicing. The more efficient the invoicing, the higher are the profits involved. When you process payments faster, you save valuable time and resources that otherwise would be wasted in manually tracking late payments and making collection calls. Compared to paper invoicing, electronic invoicing cuts processing costs by 80%—another reason enterprises are obsessed with it and encourage consumers to do the same.
As a business owner, everything and anything you do is for your consumers. The more you know about your end consumers, the easier it will be to develop solutions that will make things simpler and convenient for them. Take note of these mobile payment processing trends and incorporate them into your online store today.