It’s time for the in-store payment terminal to do more. See how merchants can meet consumer demands for BNPL, peer-to-peer payments, and more.
A store cashier asking, “Cash or credit?” is rapidly becoming a thing of the past. Of course, consumers are still welcome to pay with cash or credit, but their expectations have grown to include alternative payments at the point of sale.
Consumers Want Payment Choice
Several factors are impacting consumer payment preferences and behaviors. First, there are more ways to pay. Consumers can use plastic credit or debit EMV chip cards, contactless cards, or mobile wallets, both store-specific apps and mobile wallets with broad acceptance, such as Apple Pay and Google Pay. However, today’s omnichannel consumers are accustomed to even wider choices, including cryptocurrency and peer-to-peer (P2P) payments, which directly transfer money between two accounts.
Inflation is also impacting how consumers pay. With less cash on hand, consumers are turning to credit more often. Consumers that want to avoid growing debt are turning to other options, such as buy now, pay later (BNPL). This alternative payment method allows consumers to divide large purchases into four interest-free monthly payments. BNPL payments have seen significant growth, accounting for 180 million transactions totaling $24 billion in 2021, nearly ten times the BNPL activity in 2019.
Generational preferences are also impacting demand for payment choice. PYMNTS reports that millennials have the highest payment diversity among all generations, using debit, credit, cash, P2P payments, mobile wallets, and BNPL financing. As the largest consumer demographic, meeting their demands is critical for competitive businesses.
“The emergence of new payment methods and their adoption by a large public is changing the checkout experience as we know it,” explains Christophe Bourbier, CEO of Thunes Collections.
“Both online and offline, customers want to use their preferred payment method, be it a wallet, BNPL, or any type of card. The ability to offer a seamless omnichannel solution becomes key for a merchant in their user conversion and retention, and their payment providers need to lead the way to offer the unique checkout experience that customers request.”
How to Offer Alternative Payments In-Store
While ecommerce merchants have accepted a broad range of payment methods for some time, it’s been more difficult for brick-and-mortar merchants to accommodate their customers at the payment terminal.
Acquirers can provide a solution with a payments platform approach. With a single integration, acquirers can connect with the platform and choose from a range of payment apps, including alternative payments, to offer merchants for in-store checkout.
Working with a payment technology company with a large network of partners, like Thunes Collections, is pivotal to providing the range of payment options that consumers demand. Thunes Collections integrates alternative payment methods and makes them available at checkout to billions of customers using QR code technology, driving new payment experiences.
For example, consumers can scan a QR code displayed on the payment terminal to complete a BNPL payment or other alternative payment on their smartphones. Merchants can use signage and marketing campaigns to inform their customers that they have greater payment options – and possibly save a sale. A consumer that must make a major purchase in turbulent economic times, such as a replacement kitchen appliance or electronic equipment, may be more likely to choose a retailer that accepts BNPL or P2P payments rather than building credit card debt.
A platform approach is also flexible and scalable, enabling acquirers and merchants to adapt as consumer preferences change and new payment methods become available.
It’s time for ISVs, app developers, and acquirers to form a relationship with a leading payment platform provider to make alternative payments available to merchants now and to create a foundation for expanded functionality in the future.
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