Are bank cards on the way out? Since PayPal’s inception in 1998, technological developments in online and offline payments have moved the market forward to the point where consumers no longer have to carry a bank card. Instead in most situations they can use their phone to pay for goods and services.
In this article we examine why this is now the case, what alternate payment methods are out there for you to use, and whether it is time to fully embrace the future and ditch your traditional bank cards for good?
New Payment Services Are Quick and Simple to use
The expansion of alternative payment infrastructures has led to an abundance of new payment options in the last decade, both online and offline, including Apple Pay, Google Pay and PayPal.
The one thing all these options have in common are that they are designed to simplify the buying process, ultimately making purchases much quicker than those made with traditional bank cards.
Online transactions have never been easier. And it comes down to the simple fact that shoppers no longer have to enter their card details to make a purchase. Using Apple Pay or Paypal for example, the virtual wallet account is linked directly to your bank account or credit card already. All the buyer needs is their Paypal or Apple Pay username and password, or fingerprint or face recognition, and the purchase is completed in a few clicks.
And offline, in brick and mortar stores, customers no longer have to pull out their cards and type in their PIN number to buy goods either. Instead, simply tapping your mobile phone a couple of times and holding it towards the card reader is enough to complete the payment.
New Services Are More Secure
These new payment services are also more secure than your standard bank card. PayPal alone is backed by some of the finest encryption technologies available; utilising 128-bit encryption which is widely considered to be unbreakable in most cases.
Alongside this, PayPal acts purely as an intermediary between the buyer and the payee, never exposing the buyers card during transactions and storing the buyers personal data in a singular online vault system, which, compared to using bank cards, can be stored in various places at once.
Services such as Apple Pay and Google Pay are also extremely secure due to the fact that your card numbers are not actually stored on the device and are not shared with Google or Apple. Additionally, both services require you to use a biometric identification scan, i.e. fingerprint or facial scan, or a password to unlock the device, something which is not possible on a conventional bank card, which is especially important as most cards now come with contactless features, negating the need to enter a PIN code.
This high level of security is one of the reasons that eWallets are so popular in gambling. Indeed, you’ll find hundreds of Paypal slot sites in the UK where the virtual wallet is accepted now.
Better for Customer and Retailer
Alternate payment methods are popular for numerous reasons, but primarily, consumers favour them because of how convenient they are.
Consumer habits are constantly shifting to accommodate new technological advancements and social habits. In essence, they just want a hassle-free customer experience, with the end point – the payment, being as seamless as possible.
The onset of the COVID-19 pandemic has altered these habits, with consumers and also checkout staff now favouring a completely contactless approach to payment. In most stores, checkouts are fully equipped with the ability to handle multiple different payment methods, which simplifies the process for everyone involved.
Nevertheless, this is not applicable to all consumers, and businesses must ensure that they have a range of alternate payment options to ensure that the process is as frictionless as it can possibly be while maximising the amount of consumers that they engage with.
Some of the Most Popular Alternatives Payment Services
Apple Pay
The mobile payment market is expected to grow to $6.7 trillion in 2023 and Apple Pay is leading the way in terms of overall market share. According to CleverTap, since its inception in 2014, Apple Pay is now used by over 227 million people, making a total of 10 billion transactions in 2019. Additionally, over 60 countries support Apple Pay infrastructure whereas Google Pay and Samsung Pay are only available in 40 and 29 countries respectively.
Google Pay
Google Pay occupies a slightly smaller share of the mobile payment market at 100 million users but the ceiling for growth is much higher than Apple, according to Business of Apps, over 2.8 billion people use Android phones. Google Pay also has an advantage over Apple Pay as users can add a loyalty card to earn rewards for repeat usage.
Paypal
Perhaps the most well-established alternate payment medium, PayPal acts as an intermediary between the buyer and payee and has an active base of 392 million users and merchants, which amassed 15.4 billion total transactions in 2020. PayPal also occupies a large portion of the mobile payment market, with over 80 million people using their One Touch feature.
Neteller
Neteller is a secure digital wallet which allows users to anonymously make deposits and purchase goods on sites which a standard bank card would decline, such as online casinos. Alongside this, Neteller has a reward system for loyal members whereby users can earn points and redeem them for prizes and cash. In the last decade Neteller has been superseded somewhat by its rivals but it still remains a popular choice for online shoppers.
The Verdict
So, are bank cards on their way out? Analysing the growth of the alternate payment markets in recent years, and how the market is expected to further increase in the future, I think it’s safe to assume that bank cards will become superseded by eWallets and phone payment services over time. The large number of different methods available and the willingness of shops and online merchants to actively support them shows a seismic shift in shopping patterns that is here to stay. If you haven’t already, perhaps it’s time to get up to speed with the new market and find out what the fuss is all about.
