What do you see as some important challenges for e-commerce and e-payments in Romania currently?
In 2020 we witnessed a level of growth in e-commerce which had previously been predicted to take multiple years. Within PayU, we can say that we were prepared for this and managed to adapt to be an important pillar for the whole e-commerce market in Romania.
Offering a great first impression of online payments is a must to retain new online shoppers in particular. At the same time, with the wave of new e-commerce consumers in Romania, some challenges have begun to come to light.
Logistics couriers for example face challenges when talking about both automation and the capacity of their human personnel. And online merchants need to take seriously the issue of the overall user experience of their websites.
If not managed properly, all of these challenges could result in a bad e-commerce experience particularly for first-time consumers, which might lead at least some of these new shoppers back to offline commerce. It is the most important time to build consistent and fast trust and show both the new and existing e-commerce customers that online shopping is all about safety, rapidity, and simplicity. Unfortunately, there is no room for half measures.
As global merchants’ standards are rising and more local e-shoppers are buying across borders, there is also pressure on local merchants when speaking about using technologies to automate the online shopping process. From AI to cross-channel advertising management solutions, all of this is happening already in other markets and needs to be properly implemented by merchants in Romania.
What are the big opportunities for Romanian e-commerce and e-payments looking ahead?
In Europe, 3DS 2.0 will become mainstream in 2021 providing a great degree of card safety with an upgraded user experience. According to our estimations, we expect overall conversion rates of over 90% and even 95% with biometric authentication.
It is a trend which will contribute to building trust and reputation for online payments, but each opportunity must be seen with a sense of responsibility. Online shoppers must know the main benefits and e-commerce players like PayU need to make important efforts to educate them on why it’s a good idea to use biometric authentication for example rather than the two passwords option.
Locally, we also see opportunities which are coming from the central authorities. As of last year, Romania was last in the EU when it comes to digitization of public administration. The government thus have on their public agenda measures which will help the whole local e-commerce ecosystem. If implemented, this will really help to unleash even more new technologies.
Finally, our country has the lowest rate of small and medium-size business (SMBs) selling online, according to the DESI index. Only 11% of Romanian SMBs sell online and according to market estimates, less than 50% of these have websites which are optimized for mobile commerce. In this context, these local SMBs seem to be a focus for both national and EU authorities. It expected they may have at their disposal grant funds which can be invested in the acceleration of their digitization strategies.