Effective ways to improve and expand digital payment methods for businesses

Digital payment technology has made it possible for anyone with a smart device to conduct transactions easily and securely.

Streamlining the payment journey can be a strategic win for businesses

More than one in three UK consumers now use a digital wallet and more than half (54%) use one to pay for goods online, according to a study conducted by Paysafe.

While the cost-of-living crisis may have recently forced consumers to rethink their spending habits, UK Finance reports that there were 2 billion card transactions carried out by UK cardholders in May alone this year – 92 million of which were contactless.

Both businesses and consumers are embracing digital payments as fast, reliable, and contactless ways to pay, but there are still innovations and improvements to be made.

Embrace digital’s ability to cover a range of transactions

Instead of just collecting payments which digital technology can do in a quick and easy way, businesses should also consider using digital payments to cover more complex transactions such as refunds and sending payments back to customers.

Open banking technology can enable businesses to send money directly to their customers’ bank account without needing to know their bank details. As the money is sent electronically and usually credited within seconds, businesses can also easily track its status.

As a result, businesses can save time and money compared to manual payments like cash refunds and cheques.

Provide incentives for use

Offering customers an online rewards scheme or loyalty programme is an effective way to build up and also maintain a customer base. By incorporating cashback or discounts into a digital payment solution, customers can be motivated to frequently use electronic payments considering the rewards involved.

As consumer behaviours and spending habits constantly change, keeping up with them can easily exhaust a business’ resources. Creating a loyalty programme around a digital payment method can help increase customer retention and establish a needed rapport to consistently engage with them.

Implementing such measures can aid in creating a sense of brand awareness in the long run, allowing existing customers to become brand advocates who can help attract new ones.

Implement additional layers of security

Customers are understandably prioritising security when paying online. Research from Paysafe shows that 62% of people are increasingly concerned about fraud. These fears have led to 58% of people feeling uncomfortable when entering their financial data online to pay for goods and services.

Some businesses feel that ensuring their digital payment offerings balance security with customer convenience can be a challenge. However, the technology available today can enable a smooth customer experience while also working to improve fraud controls and minimise user friction.

Implementing security measures such as identity management and encryption can help protect customers’ identity and mitigate the risk of fraud. These measures can ultimately help businesses alleviate customers’ anxieties and inspire confidence when using digital payment methods.

Create a faster user experience

Streamlining the payment journey can be a strategic win – particularly in a climate of increased competition among digital payment providers. Efficiency is a priority for customers when it comes to online shopping and paying electronically.

Forbes reports that more than half (54%) of online shoppers say that they’d abandon a shopping cart if a company asked for too much information, with the majority (82%) saying they’d leave if the account registration process was too complicated. Limiting the data requested on a payment page or link can be an effective way for a business to reduce its cart abandonment rate as asking for more information merely adds more steps to the payment journey.

Pre-populating any fields and keeping everything on a single page can be a simple solution to minimise clicks and redirects. This can be an effective way for a business to show that its digital payment solution is secure, responsive, and able to handle multiple transactions.

Introducing digital payment methods to customers and ensuring adoption can be a challenge many businesses find daunting. Yet by highlighting and promoting the efficiency and convenience such methods provide, businesses can look to deliver secure, reliable, and quick services to customers.