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15 December 2020
Digital payments will become mainstream
Money & financeE-commerce & mobile retailDigital payments
PayPal’s Cameron McLean argues that digital payments will gain heightened importance as a result of the COVID-19 pandemic.
A reluctance to handle cash will force the adoption of contactless and digital payments as the preferred transaction method both offline and online:
In Q3, PayPal saw 15.2 million new active accounts – our second highest quarter in organic user growth – coupled with 1.5 million new merchants come onboard – twice our usual rate in a quarter.
Salesforce’s State of the Connected Customer research report also found that consumers now spend 60% of their time interacting with companies online compared to 42% before the pandemic. By incorporating the Online to Offline (O2O) model – which refers to services such as online information, discounts or services, member rebates, in-store pickup of items purchased online, or the allowing of online purchases to be returned to physical stores – to their business strategies, companies can improve customer experience, service and loyalty. On the O2O model, we also expect consumers to opt for payment methods that act as a bridge between online and offline, such as digital wallets offering QR codes.
In line with the upward trend of e-commerce, businesses will also need to find ways to optimise and protect margins. On average, 88% of shopping carts globally are abandoned, with one of the most common reasons attributed to complex checkout processes.
For businesses looking to keep and grow their customer base in this competitive environment, a simpler, faster and more intuitive checkout process with seamless and safe payment options is critical.