Payment trends in 2017: Will mobile payments be a game-changer?
The expansion of mobile commerce over the last year brought huge changes. People carry their smartphones everywhere, so why wouldn’t they use it to pay on the go?
Still, many businesses are afraid of new technology and ask themselves whether they are ready for mobile payments. If not now, then when? There’s no question that m-commerce is going to make significant changes to our shopping behavior. The point is to give customers the buying experience they expect.
According to Cisco® VNI Global Mobile Data Traffic Forecast 2015-2020, by 2020 there will be 5.5 billion global mobile users, up from 4.8 billion in 2015. In recent years, we watched the rise of mobile payment solutions from the biggest tech brands such as Apple, Samsung, Google, and Amazon. Social media platforms have also added payments to allow users to make purchases while chatting with friends.
How do we buy on mobile devices?
Today, we’re doing our shopping on multiple devices. For instance, we first look for the product and compare prices on a mobile device, and then buy it on a desktop (and vice versa). It’s still evolving and people are more willing to buy via smart devices today than ever before.
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It is predicted that by 2025, 75% of all transactions will be made without cash. The popularity of mobile payment applications and mobile banking is still growing as well. It shows we are more willing to use smart devices and cards to pay than carry the physical money with us.
The latest Visa research shows that the number of Europeans regularly using a mobile device for payments has tripled since 2015, from 18% to 54%. And the top 3 countries with the highest number of mobile payments users are Turkey, Denmark, and Norway. Another report shows that in the U.S. mobile payments have been made by 39% of mobile users in 2015 (up from 14%).
Meeting customers’ expectations
The numbers display a huge potential in the mobile industry and mobile payments as well. The payment industry evolves constantly and the biggest challenge is to meet still growing users’ demands and expectations.
Shoppers tend to choose their tablets and smartphones to compare prices, read reviews, and finally buy products. Larger smartphone screens make them choose mobile devices to research the internet. It’s a bit more convenient for people who are constantly on the go.
Consumers around the world understand the benefits of mobile payments, but there’s still a lot to do. A real challenge for mobile payment providers is user convenience. When a customer is happy, your conversion rate increases. So, the main goal is to optimize mobile checkout to make payments as simple as possible and lower the number of abandoned carts.
It’s not that easy to insert all the payment information on a small screen, so only companies that provide perfectly designed and mobile-friendly solutions will be successful. Online businesses that accept payments need to understand that providing seamless, quick and safe mobile payments is a must. It’s not the future, but now.
Removing friction from the checkout process
Still, many retailers are not prepared to provide mobile users with high quality and well-designed websites or apps. Mobile users spend 86% of their time on mobile apps, and just 14% on the mobile versions of websites. According to these stats, online retailers should pay more attention to the app-based shopping experience.
The checkout process for mobile has to be as simple as possible. Without redirections, distractions, misleading links, buttons, etc. Online retailers should ask for essentials only, and their customers should be able to pay in seconds. It’s a huge game-changer for both small and large businesses.
Paying for a transaction by a tap is what mobile users want. There’s nothing pleasant in entering a bunch of information on a small screen. Immediacy is one of the key drivers to attract mobile customers. Purchasing needs to be reduced to one action. We live fast, and avoid everything that takes our valuable time (time is money, right?).
OK, what should the perfect mobile payment solution have to make customers buy from you?
- Ease & convenience of payments, anytime and anywhere.
- One-click payments with no need to enter in all the card details every time we want to buy something at our favorite store.
- Simplified user flow and payments without redirections. Text input should be reduced to a minimum. Fewer clicks mean more sales.
- User-friendly design with bigger input fields, without any distractions and needless elements.
Fintech brings innovations
There is still room for mobile payments to expand. FinTech solutions are here to answer online retailers and customers’ needs. Innovation brings enormous changes and lots of benefits for both merchants and customers.
We can observe the growing number of innovations in mobile payments. For instance, MasterCard recently launched a program that replaces passwords with selfies. It’s a biometric authentication app which asks a customer to scan his face to pay. The company also announced testing other authentication methods, such as facial identification, voice recognition, and cardiac rhythm.
The main goal is to make the mobile payment flow as simple as possible. It doesn’t have to be facial recognition, but it needs to be quick and simple for customers to pay.
The growing importance of mobile
Mobile commerce is expected to grow faster and online shoppers are using smart devices more frequently, at least to compare prices or find product information.
Why do we like to buy on mobile more than a year ago? The main reason is that now we have more mobile-friendly websites and more retail apps on the market. Also, smartphones have bigger screens and we tend to use smart devices every day, e.g. while commuting, waiting in a line or even when watching TV.
There’s also been a growth of payments in messaging apps. So, in a few years, social media users will be able to make purchases directly from these apps. The development of big data will also make it easier for merchants to provide customized offers, coupons, etc.
Are mobile payments secure?
One of the most prominent arguments for not paying on mobile devices is the fear of cyber security threats. Security issues are still the largest barrier for non-users. People have concerns about adding their card to their smart devices. For more than half of consumers, mobile wallets are less secure than cash. And at the same time, 25% of consumers believe that online and mobile transactions are the safest of all transactions.
Customers still have strong security concerns and are afraid of fraud. But, what’s interesting is that mobile payments users are comfortable making expensive purchases on mobile devices according to Visa.
Mobile users need to understand that, with the constant growth of m-commerce and new technologies, the quality of mobile payments is getting higher day by day. Payments are well protected by tokenization that replaces sensitive data with a token (string of random digits and letters). So, even if hackers steal the token, it will be useless for them.
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There’s no question that mobile solutions will spread to our everyday activities. The number of mobile users is constantly growing and people are more willing to buy via smart devices.
It’s because more merchants offer retail apps and mobile versions of their online stores. But, it’s also a combination of great UI, better mobile app design, smartphone technology, push notifications, and enhanced mobile payment solutions.
What do you think, will mobile payments be a real game-changer?
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