There’s no doubt that payment processes have evolved over time. And COVID-19 pandemic has accelerated the adoption of multiple method payments in post-pandemic world.
As the world adapted to the pandemic, we have seen a dramatic shift in consumer behavior and an increased interest in alternative and local payment methods. The way consumers pay has changed dramatically since the start of the pandemic. Concerned over touching surfaces and banknotes, many consumers ditched cash and turned to multiple payment options and other forms of contactless payment.
A study conducted by the National Retail Federation revealed that one-in-five consumers surveyed made a contactless payment in-store for the first time since the onset of COVID-19. Of those, 62% used their phone and 56% used a contactless card to make a purchase. Additionally, about 57% of consumers said they would likely continue using contactless payments in post-pandemic world.
As the global payment industry evolves, merchants can benefit by adopting new technology to stay current and keep up with the changing consumer preferences. Take a deeper look at how the global pandemic has spurred the adoption of new payment methods and trends in the U.S. and beyond.
Embedded finance for more seamless payments
Global e-commerce now counts for nearly one-fifth of all retail sales. The tremendous increase in online activity led to the increase of consumers’ expectations that their online transactions be as seamless as possible.
Embedded finance is when tech companies offer payment processing, wealth management, and other additional financial services, alongside their usual services.
Buy Now Pay Later (BNPL) will stay
During the pandemic, BNPL schemes have won increasing popularity amongst consumers. They regularly refer to it as the fastest-growing payment option. The fast adoption of BNPL has happened because it is equally beneficial both to consumers and merchants by delivering commercial advantage for merchants together. They offer a new interest-free alternative form of short-term credit for consumers and businesses.
But it’s not all roses and BNPL critics admit that the scheme forces people to splurge on things they can’t afford, and it is less protected than a traditional credit card. But in spite of that BNPL will stay, though its growth could slow as providers will become increasingly regulated.
Contactless payments
Contactless payments, also known as tap-and-go and tap-to-pay, are done by tapping a payment card or other device near a card reader equipped with contactless payment technology. This is done without the need to swipe, enter a PIN, and/or sign for a transaction.
This convenient way to pay enables customers and retailers to conduct seamless, fast, secure, and socially distanced transactions. And usage of such payments has soared in the last year and a half due to COVID-19.
QR codes
Quick response (QR) codes, which are barcodes that store information that can be read by a digital device, can be used for:
- Web links
- Document access
- Product identification
- Loyalty programs
- Payments
The COVID-19 pandemic has accelerated the usage of QR codes. Especially in the restaurant industry. And more merchants and consumers are using QR payment technology for the myriad of benefits and convenience it provides.
Mobile wallets
A mobile wallet is a digital version of your actual wallet. It can hold credit cards, tickets, coupons, or rewards card information. Mobile payments are made by phone. Such as:
- Apple Pay
- Google Pay
- Samsung Pay
And other wearable devices are growing by double digits annually. The benefits of mobile payments in post pandemic world include faster checkout that is completely touchless. Which results in a better experience for customers and staff, along with increased data security.
Conclusion
To keep up with the rapid pace of change, businesses need to adopt technology infrastructure that supports innovation, simplifies commerce, and improves experiences. The world has been forced to modernize its payments in the post-pandemic world to keep commerce flowing and sustain economic growth.
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