Customers are increasingly demanding choices at checkout when it comes to online payment methods. This is why it’s vital for eCommerce merchants to empower their audience to pay in a way that suits them.
There really are no drawbacks to accepting different online payment methods on your site. In fact, offering customers the choice they’re looking for means they’ll spend more. In addition, they’ll have a better customer experience, and you’ll be able to create long-term, loyal customer relationships. With so many choices, it can however be a challenge to pick the best online payment methods for your audience.
We spotlight the top online payment methods retailers should offer to shoppers:
Credit and debit card payments
Credit and debit cards remain the most popular payment method for consumers to make purchases online. Paying with a credit or debit card is the favoured online payment method for South African shoppers, according to a 2020 Online Shopping Survey conducted by MyBroadband. 77% of respondents said that paying by credit or debit card was the online payment method they used most often. Paying with a credit or debit card is convenient and quick, and in many cases, shoppers can earn rewards for their purchases on certain credit cards.
Buy now pay later (BNPL)
Buy now pay later programmes have exploded since the COVID-19 outbreak. This is because customers are looking to keep a tighter grip on their finances and avoid unnecessary debt. BNPL solution provider Afterpay onboarded more than 1 million US users within a 10-week span as consumers went online to shop during the height of the pandemic.
At the same time, South African BNPL Payflex has experienced a 40% increase in merchant sign-ups since March and a 35% increase in user sign-ups. A recent report by Worldpay from FIS forecasts that BNPL services will steadily gain eCommerce market share ultimately earning nearly 3% of global eCommerce spend by 2023.
Digital wallets
Digital wallets offer a convenient way to securely store your bank account or credit card payment details online. They are essentially a virtual version of the wallet you carry around with you on a daily basis . Digital wallets like PayPal, Google Pay, SnapScan, Samsung Pay, Zapper, and Masterpass, offer consumers a convenient way to pay without a physical card.
They allow users to send, receive and manage their money in one single account. The global mobile wallets industry is set to climb by almost 50% amid the Covid-19 outbreak, reaching $1.47trn value this year. In South Africa, MTN, FNB, and Absa all reported an uptick in their mobile payment offerings due to the pandemic. Prior to the outbreak of the virus, the South African mobile payment industry was expected to reach US$ 29,424.3 million by 2025. This is obviously expected to increase with the virus driving a greater number of consumers towards digital transactions.
Instant EFT
Instant EFT enables customers to either load the payment themselves via their preferred banking portal or create a payment automatically via an instant EFT system like Payfast, Ozow, or Paygate. From the buyer’s point of view, EFT is something they are familiar with which creates an element of trust. Since its launch, automated EFT payment solution, Ozow, has processed more than R10-billion through its merchant clients.
The more online payment methods, the better
Your customers now have more ways to pay online than ever. Make sure your eCommerce site offers the right mix of online payment methods including both traditional and alternative payment methods. Offering a mix of different online payment methods is a win-win for you. Not only will it help you build customer loyalty, but will drive down cart abandonment rates. However, your customer wants to pay, make sure you have an online payment method that suits their unique needs.
