The importance of security
The arrival of payment systems that function seamlessly with mobile devices, in-app, or online has encouraged the financial sector to innovate across the payments journey. But having accelerated the movement of even the most traditional of shoppers to digital and mobile apps over the past two years, building trust throughout the payments part of the buying journey is now key for banks.
According to the Office for National Statistics, online sales hit a record high of 38% of all retail spending in January 2021, up from 20% in January 2020 before the first pandemic-related lockdowns. Although this has dropped with the re-opening of bricks and mortar stores, and people returning to working weeks, there is still a predicted growth in online sales for 2022 of 10%.
Retailers are acknowledging that the checkout process and security are two of the key issues they need to address going forwards. In our whitepaper – Evolving Digital Commerce – we asked over 100 eCommerce leaders in both retail and B2B organisations their top priorities for 2022. The report shows that investing in robust and up-to-date security solutions and ensuring that companies are well-equipped to store their customers’ personal data is a major priority for 78% of the decision makers surveyed.
Put simply, the automatic movement of money worries a lot of consumers, and fears over security and loss weigh heavy for some. Trust builds loyalty in both the retail and B2B eCommerce industries. To reinforce consumer trust, banks and FinTechs need to personalise the payments experience, keep up with innovative technologies and improve their approach to security and protecting data.
The payment chain
With online sales now making up 34% of retail spending, it is important for businesses to have a payment gateway.
A payment gateway is crucial in the payment chain and authorises credit card or direct payments for a retailer. Once an order takes place, the integrated gateway is there to deliver the client’s sensitive information securely, encrypting the data it in a way that banking systems can use. The gateway can be provided by a bank to its customers or a specialised payments company as a separate service.
The gateway will use built-in security protocols to check for fraud and available balance etc. This is known as TLS (Transport Layer Security) and, although there are a lot of steps involved, the process should be quick and messages to the customer should reassure them in the security of the system.
To help keep transactions safe and build customer trust, a good payment gateway should also:
Seamless integration
Good UX is paramount to growth, and customers expect the payment process to be an invisible part of whatever shopping cart process you are using. Their experience should be simple and adaptable, and ideally should be conducted without any redirects, thus streamlining UX.
Payment processing
In our report, 59% of decision makers are focussed on improving speed and simplicity at checkout, and with the arrival of SCA (Strong Customer Authentication), it’s crucial that retailers look to reduce friction at the check-out with their online payment gateway.
If the payment process takes too long you risk abandonment, and the customer may not have faith in the process. In Barclaycard’s study, lengthy payment authentication processes would cause 24% of shoppers to consider dropping out at checkout.
Payment options
Modern consumers have embraced modern payment systems (e.g., Klarna, apple pay... etc). Lack of payment options is a major player in abandoned baskets. According to global analyst house Ovum and payments provider Klarna, 40% of consumers cited a lack of payment methods and 39% suggested a lack of lending or credit options would stop them completing the payment process.
Reliability
The payment is THE most crucial part of the buying process for the merchant and reliability should be paramount. If there are technical issues, sales are likely to be lost. To avoid any abandonments, check that your provider offers an uptime guarantee.
Security
Payment gateways are convenient for both the retailer and its customers, yet it is such an ‘important’ target for hackers and scammers. A good payment gateway can help retailers fight these attacks with encryption between buyer and seller. Your gateway should be compliant with security standards like PCI DSS Level 1., data encryption etc.
Trends
Payment providers need to keep up their own systems up to date, as hackers are known to target outdated systems. You should also have a system that can grow with your business – scalability and helping you adapt to potential new markets is key.
Building customer's trust
According to US research firm Gartner, 64% of consumers believe that customer experience is now more important than price when choosing a brand or a store. The right brand positioning, no redirects and a simple interface will provide a smoother user journey that keeps your customers on your site and see their purchase through.
Using personalisation and messaging throughout every stage of the payment journey, will help the customer feel a connection and reassurance. This could be the difference between a satisfactory shopping experience and a genuinely great one.
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