Online shopping has become an increasingly popular activity among British consumers in recent years, with a new study by DECTA showing that 85% of them consider the payment method to be a key factor influencing their experience. The survey found that of all those who shopped online in the UK, 49% would walk away from a purchase if their preferred payment method wasn’t available.
This indicates that offering customers a wide range of payment methods is essential in order to provide an enjoyable shopping experience and encourage return purchases. In addition, the study highlighted the importance for businesses to become aware of the preferences among their target audience. Embedded finance solutions enable businesses to provide customers with a wide range of payment options without having to manage any additional infrastructure.
Faster payments
Real-time payments are playing an increasingly important role in the global payments ecosystem, with the number of such transactions soaring by 41% in 2020 alone. This technology is also increasingly important in key emerging markets, with the Asia-Pacific region leading the way in real-time payments – India registered 25.6 billion transactions in 2020.
“Payment clearing speed and efficiency are critical in today’s fast-paced digital economy. Embedded real-time payments help businesses deliver products and services directly to consumers wherever and whenever they may need them.” – says Norberts Millers, Product Owner at DECTA.
Our research broadly supported this notion, although the importance of transaction processing speed was considered markedly more important in the UK. Payments speed was reported to be the second most important feature for positive consumer experiences among British participants, with 68% of those surveyed considering it to be either the most important feature of positive experience, or very important in this process.
This figure was lower in the United States, but the majority of those surveyed (53%) still considered fast payment clearing speeds to be important. It is also notable that U.S. respondents were particularly irked when websites failed to update quickly. A web page not loading on the first attempt was seen as more annoying than any other event in the survey by participants in the United States.
In short, our survey found that faster payment speeds greatly improve the customer experience, while significantly reducing the possibility that consumers will abandon purchases. The faster checkout speeds associated with embedded finance have already proved popular, with a recent study from Temenos discovering that 60% of UK consumers have used embedded finance products during the checkout process in the last 12 months.
Preferred Payment Methods
When it comes to payment methods, merchants must be prepared to accommodate the preferences of their customers and provide a variety of payment solutions. In the United States, when asked which feature most contributed to a positive shopping experience, 54% of respondents responded that the availability of their preferred payment method was either the most important or very important. This number jumped to 85% in the UK. It is clear that merchants must take payment method preferences into account when designing and implementing their embedded finance solutions. Failure to do so could result in lost customers or abandoned purchases. Consumers, especially younger generations, are increasingly relying on different payment methods, including those managed by embedded finance solutions. Merchants should ensure they are prepared and able to offer the payment methods their customers need.
By providing customers with a variety of payment options, merchants can ensure their customers have the best possible shopping experience. With an ever evolving payments landscape, merchants need to remain agile and prepared for whatever payment methods become popular in their target markets. This will enable them to provide the best service possible to their customers, ultimately leading to increased sales. Embedded finance solutions are an excellent way for merchants to ensure they can offer their customers the payment methods they need. They allow merchants to focus on their core business while still providing customers with a wide range of payment options and features, ensuring customer satisfaction and loyalty in the long run.
Full study available at: https://www.decta.com/company/media/the-role-of-embedded-finance-in-boosting-conversion-rates-a-report
