Improvements in technology come at a dizzying speed and merchants must keep up in order to satisfy the needs and expectations of their customers. Slow loading times and multi-step checkout will prompt consumers to shop elsewhere online. Moreover, the need for contactless and digital payment options has become critical in an age altered by the novel coronavirus, Covid-19.
Covid-19 and contactless consumer trends
Even before the Covid-19 pandemic engulfed the world, consumers were turning to the web to research products and make purchases. This was a double-edged sword for small business owners. For some who embraced e-commerce and invested in the necessary digital infrastructure, this change has allowed them to remain competitive with chains and big box stores. For those who had put off adding e-commerce to their brick-and-mortar shopping options, the importance of embracing buying options for their customers has become a priority.
For brick-and-mortar retailers, e-commerce is not the only consideration their customers are demanding. Consumers and governmental agencies alike are demanding expanded contactless payment options be offered in-store. In addition to the obvious health and safety benefits, offering mobile and Near Field Communication (NFC) enabled payment options supply added convenience and speed in completing transactions.
The World Health Organization’s warnings that Covid-19 might be carried and spread on bank notes raised flags for consumers and retailers alike. The extent of risk posed by cash payments has yet to be proven, but the fact remains that an abundance of caution is necessary to protect not only the health and safety of employees and customers, but of businesses and brands as well.
More Reading: Consumers Will Switch Merchants for Contactless Payments
Contactless Payment for the Ages
A study* conducted jointly by the National Retail Federation (NRF) and Forrester concluded that “the use of mobile payments and contactless credit and debit cards has significantly increased” in the months since Covid-19 has consumed the public consciousness. Prior to this, contactless payment methods accounted for a minority of payments in the US used primarily by Millenials and Gen Z consumers and business owners alike.
The same study found that the number of retailers accepting contactless payment options rose in the same time frame. In Q3 2020, 67% of polled retailers were accepting at least one type of touchless payment. Of those, 58% accept cards that can be tapped or waved over the terminal. This is up from 40% the year prior.
The influential Baby Boomer and Gen X generations, who had previously viewed the Internet of Things (IoT) and smart or tech-enabled consumer options with suspicion, have been forced to re-examine pre-conceived notions about the usefulness and security of contactless consumer trends.
Benefits of Contactless Payments
If you are considering offering or expanding the types of contactless payments you offer to your customers, there are a few points to consider.
- POS System Updates: If you have an old terminal, you will need to update it to one that will accept NFC payments. This also presents an excellent opportunity to investigate adding or expanding the e-commerce options you provide your customers.
- Accessibility: While it is becoming less of an issue, the reality continues to be that certain groups of people have less access to smart devices even in the United States. Depending on your operating location, this might be something you will need to consider for your business.
- Transaction Limits: Because a PIN is not required for tap-to-pay transactions, banks and credit institutions set limits on maximum purchases and withdrawals. Limits vary depending on the card issuer and the policies of the sponsoring bank.
Many of these considerations are being addressed on a global scale due to the wide scale adoption that has occurred in light of Covid-19. Transaction limits are seeing increases of anywhere from 25-400% so your big spending customers cap tap-to-pay for their purchases quickly and conveniently.
How Sekure can help
At Sekure, we help merchants better analyze their customers’ habits and identify consumer trends. We can also help you identify better payment opportunities for your customers—whether it’s EMV credit cards, contactless payments, and mobile wallets—and more. Learn what merchants are saying about Sekure.