More consumers than ever use smartphones for mobile banking and spending money. A few years ago, the majority of people preferred to shop and bank on laptops; now smartphones are at the centre of our financial experiences. Everywhere in the world, cash is quickly making way for secure payments on mobile devices.
Don’t just take my word for it I may be biased, however there are numerous studies and statistics pointing to this upwards trend! The following digest provides a few reasons why merchants should explore accepting transactions via mobile payment apps.
Mobile payment apps replacing cash and cards
A study by Javelin Strategy & Research predicts that mobile payments will exceed $410 billion in 2020. Contactless payments using apps are also expected to grow exponentially, exceeding $318 billion in 2020.
Another study this time by Visa, which surveyed 36,000 European online consumers, found that the number of people who have not used a phone to make a payment is down to 12% in the UK. We are already at the point whereby 74% of UK online consumers manage their finances using a smartphone, and 43% are comfortable making a big ticket purchase, such as a holiday.
Customers are no longer using phones purely for research; they’re an essential tool in the purchasing journey, often the only device involved. Consumers everywhere are embracing mobile wallets and payment apps, which means merchants need to give them the option to pay using new methods, in-store and online.
Historically, smartphones were embraced more readily in developing countries as a payment, banking and peer-to-peer finance tool. Asia, Africa, the Middle East and Latin America saw rapid adoption once mobile data networks were sufficient and secure enough to support payments and money transfers.
Mobile payments and banking are now just as popular in Europe, with 9 out of the top 10 countries in Europe, according to the Visa study. 91% of consumers in Turkey – a country that straddles Europe and Asia – use mobile payments: leading the world for mobile payments use.
Many businesses and retailers have been quick to realise that accepting payments via mobile apps can help them reach customers anywhere in the world. Customers in turn are rewarding them with sales and loyalty. We all know that providing a customer with their trusted and preferred payment options increases conversion, now we need to ensure that payment apps are part of the customer journey.
Quick, Secure, Convenient
With the option to connect to debit and credit cards, customers are also embracing the extra control and choice they now have. It makes it easier for them to transfer money to friends and family, and increases financial inclusion. For those without access to bank accounts, the unbanked, new apps and services are providing finance solutions that don’t involve having a physical wallet stuffed with cash.
However, the marketplace is crowded with many new mobile wallets and payment apps, so which ones should your business accept? The answer is, of course, the ones your customers are using and that offer your business clear benefits.
Offline, mobile payment apps simply require an NFC-equipped POS terminal. Online, payment apps can be integrated with your payment gateway so that customers are given the options they desire. Naturally customers are only likely to have enabled one or two payment apps on their smartphones and providers, like MuchBetter, are working hard to reach new customers and build loyalty with existing users.
In our case we’re differentiating our brand and payment app from others in the marketplace by making the customer experience more rewarding. With low fees and the opportunity to cash in loyalty points in exchange for rewards from our merchants, our customers are rewarding us their loyalty. We get out what we put in: customers, merchants and payment apps alike.