We live in a time of great innovation and change, especially when it comes to the retail industry. It's now more competitive than ever, with ecommerce giants like Amazon continuing to grow and dominate the market.
The internet has changed how we shop, and technologies like contactless payments have made shopping more convenient than ever before. In particular, payment innovations have been changing the way consumers pay for goods and services. As a result, retailers need to stay on top of emerging trends to maintain their competitive edge.
This blog post will explore the future of payment technologies and what it means for you as a CBD business or dispensary owner.
What is the Future of Payment Solutions?
1. Shift Towards Digital Payments
Nowadays, most consumers love to shop online and hate carrying cash with them. This trend only grew larger with the COVID-19 pandemic accelerating the cashless transactions trend with stay-at-home orders prompting people to tap into the world of ecommerce.
However, if they do decide to visit the physical store, they expect a quick and painless transaction. This is why your business must offer a digital payment solution in addition to cash.
Payment methods such as cash and checks are cumbersome and require an effort to use, but the digitization of payments through digital wallets makes it more convenient for both merchants and customers.
An innovative payment solution for your business may include a mobile app or QR code that allows customers to pay in store, online or through mobile-based payments.
2. Increased Popularity of Mobile Wallets
Almost everyone carries a phone with them nowadays, sometimes even leaving their wallets at home. And since customers prefer convenience, mobile payments are now generating billions of dollars in revenue each year.
Simply put, mobile payments are any payments made with a mobile phone, be it through an ecommerce site or an app. With widespread acceptance of mobile payments now available, it’s no wonder there's 53% faster growth on mobile devices vs desktop computers.
Mobile wallets (Apple Pay or Samsung Pay, for example) are a new innovation that allows customers to pay using a credit or debit card. Making a purchase is now increasingly easy and convenient. It’s also secure, as the app stores this information by linking personal identification such as number, key, QR code or image of the owner to each card.
As a merchant, the use of these wallets can help your business collect data on customers' shopping habits and preferences so that you can tailor your promotions individually. Besides, mobile wallets prompt their owners to spend money in one tap, which could potentially increase sales.
3. The Customer Experience as Your Prime Focus
Everyone knows that customer experience is crucial in retail. Even Jeff Bezos once said: “Focusing on the customer makes a company more resilient.”
But did you know that finding the right payment solution can help with your customer experience? That’s right: picking the right POS and considering tipping options, payouts or even getting minimum charges per transaction could affect your customers’ experience at your store.
Today’s customers are picky. There are just too many options out there! People are looking for great prices and products as well as an efficient shopping experience, be that online or in store. Therefore, it’s essential to offer a variety of payment options for your customers.
When setting up the checkout process on your website, you must choose from at least three reliable and popular methods (i.e. credit cards, PayPal direct or checks) that are safe from fraud and are easy to use, which is all part of the customer experience. The best way to know which method will work the best for your customers is to ask them! Encourage feedback by sending out surveys so you can identify what your potential clients want as their preferred method(s).
Still, the future of payment solutions is not all about cashless transactions or mobile payments. It’s also about the overall experience of shopping. For example, if you require new customers to create an account to complete a purchase, there’s a higher chance that they will abandon their cart. The goal is to simplify their user journey and let them flow through the purchase process without any barriers.
4. Biometric Payments
While speed and ease of use are more popular considerations when deciding on a payment solution, security should be on the top of your list. Introducing biometric payments! Exceptionally secure payments leveraging new technology from popular consumer devices.
Many customers are already engaged in biometric technology without even realizing it. Consumers are now used to biometric authentication, as most mobile devices use face ID or fingerprint to unlock themselves.
Similarly, this payment technology uses biometric authentication methods to identify the user and to authorize deductions from their bank account. A majority of mobile payments now leverage biometric technology through either a face or fingerprint scan.
When it comes to biometric payment methods, most POS (point-of-sale) systems incorporate two-factor authentication, meaning you will have to scan your finger as well as put in a PIN, just as you would with a normal credit card.
5. Prepaid Cards
A prepaid card is a payment method similar to a debit card, as you load a certain amount of money on it, but it is not linked to a specific financial institution. Customers can use these cards when shopping at major retailers or even when they’re paying bills.
Prepaid cards are a good way for customers to save money by only buying the products they need and are also often used when shopping online because they are convenient and cost-effective.
So why should you accept prepaid cards? For merchants, accepting prepaid cards can be easy. There’s often no additional hardware or software required to accept them. Major card brands usually issue them; the process may even look similar to accepting credit/debit cards - you might already have this set up with your payment provider.
Prepaid cards are an integral part of the future of commerce. They're a flexible and effective way to improve customer experience while capturing new customers that may not want to have a debit or credit card.
After all, it’s best to provide as many payment options as possible.
6. Crypto Currencies
Virtual currencies are the newest form of payment methods that are taking over the world. These currencies represent value that is only available in electronic form. They are stored in a digital wallet that can be accessed via an online platform or downloaded on your mobile phone.
An example of a virtual currency is the famous Bitcoin, which disrupted the currency market back in 2008. Operating through decentralized blockchain technology, Bitcoin allows for every transaction to be permanently and cryptically recorded. Because of their decentralized nature, these virtual currencies can also protect merchants against fraud and limit the time-wasting chargebacks, as there are no third parties to cancel your online payment.
Besides having lower transactional fees, virtual currencies are nearly instantly processed, and there’s no need for funds to clear, as it's processed in real time.
7. Virtual Cards
Virtual payment cards are the holy grail of online transactions. They act just like traditional debit or credit cards; without the need for an actual physical card, these virtual randomly-generated 16-digit numbers are accepted anywhere traditional cards are accepted.
Companies love cashless transactions, since they are easier to manage. Virtual payments eliminate the need for paper money and coins, which reduces the time they spend counting the cash and collecting change. Cashier errors and theft are also eliminated with this method of payment. More importantly, it improves customer satisfaction, as it offers another way for them to pay at your store.
8. IoT Devices
With Internet of Things (IoT) devices continuously growing, our already connected world is becoming more integrated: the most tangible trend is the expansion of payment acceptance networks. This means that smartphones or tablets are not the only potential purchasing tool in the eyes of the consumer - every device is.
Today’s consumer expects to make purchases wherever they are and whenever they want. This expectation, tied in with the feeling of familiarity of shopping using mobile or voice-activated devices, created an expectation that even your fridge should be able to deliver your groceries.
With this in mind, it’s important for merchants to stay agile and utilize Internet of Things devices to your advantage.
In the next decade, we will see more and more payment innovations. As a result, the future of payment solutions is rapidly changing. To keep up in the retail space, you will need to expand your payment solutions into next-gen capabilities that will include biometric authentication, mobile payments and contextual awareness.
Feeling overwhelmed? Let Merrco help. We keep customers compliant in regulated industries while giving you an edge over your competition with intelligent, simple payments that are tailor-made just for you!
Our payments experts have experience working with a wide range of businesses in different sectors. Contact us today, and we can help you find the right solutions for your business. Call us at 1-800-957-0534 or email us at firstname.lastname@example.org.