The changing sphere has changed the customer landscape and has positioned customers in an advantageous position. During the pandemic, more than one-fifth of global retailers have adapted to the changing consumer landscape during the pandemic by either building e-commerce sites or starting to accept contactless transactions. The initial catalyst for this transformation was primarily the lack of alternatives (with in-store retail being closed for extended periods), but many changes in online purchasing behavior have caught on in a way that looks like it’s here to stay.
Consumers’ growing adoption of alternative payment methods also indicates that they expect retailers to offer more shopping and payment options — and that they might take their business elsewhere if this is not provided. 79% of consumers prefer to shop at stores that offer both in-person and digital presences, while more than half avoid retailers that do not offer electronic payment options and 68% are particularly interested in shopping with merchants that provide the latest payment methods.
Consumers also point to lack of preferred payment options as a key factor behind abandoning their carts at checkout. Cart abandonment impacts almost 75% of global purchases and can cost merchants a staggering $4 trillion annually. Gearing up to enable a variety of cross-border digital payment options helps merchants to reduce cart abandonments and increase online conversions.
Alternative payment methods are changing the global payments landscape
The continued growth in cross-border sales and the use of alternative payment methods by consumers demonstrates that digital payment adoption is altering global payment infrastructure on two distinct fronts.
First, the payment system is evolving to enable an increasing amount of contactless transactions via cards, digital wallets, instant payments, bill payment solutions and pay-per-link. At the same time, cryptocurrencies, BNPL (Buy Now Pay Later) and other newer alternative payment methods represent an additional shift in the ecosystem.
Together these market changes are making cross-border payments more frictionless and streamlined, resulting in online transactions that are faster, more transparent, more efficient and more secure than ever before. From a merchant perspective, tailoring the checkout experience to meet consumers’ expectations for speed and seamlessness results in higher customer satisfaction and payment approval rates, leading to increased sales and online revenue.