Guest post by Kristen Gramigna of BluePay
The jury of public opinion has spoken: Customers love online payments. Here are just four reasons why:
Customers are impatient
Waiting in line is a society norm — but there’s plenty of scientific evidence to prove that its highly undesirable to customers — and the businesses who want their patronage. As The New York Times reported, people overestimate the wait time associated with a line by as much as 36 percent, regardless of how fast it progresses.
People tend to be less irritated about a wait when they’re given an expectation for how long it will be — and exuberant when it proves to be less time consuming than anticipated.
Online payments can solve for all of these wait time dilemmas: They give customers the option to skip the store visit (and its line) altogether. When visiting a business’s physical location, mobile payments empower customers to avoid a traditional checkout process. Online payments can also provide estimates of how many seconds until the transaction is complete.
With that said, a business’s online payment experience should proactively eliminate the unnecessary steps that extend “wait time” as well. For example, experts at ConversionXL recommend that e-commerce merchants allow customers to purchase as a “guest” (without forcing a registration or login), and prefill form fields like city and state when the customer enters his/her billing/shipping zip code(s).
On the page where the customer enters payment information, visually presenting the space to mimic the appearance of the front and back of a card can also promote ease of use.
Consumers are accustomed to online banking
The Federal Reserve’s Consumers and Mobile Financial Services 2014 report indicates that more than 60 percent of Americans have a smartphone, and more than half used it for mobile banking in the past 12 months.
Though the highest percentage of mobile transactions were from cheque account balances and transaction history, mobile banking as a form of online payment is becoming increasingly popular, as consumers grow accustomed to using online banking for bill payment, mobile payment and peer-to-peer transfers.
Before online payments were an option, paying bills was a laborious process that cost customers time and money. With the popularity of online payments, customers no longer need to invest in paper cheques, stamps or envelopes; they can initiate payment online, and see the impact on their available balance reflected accordingly.
Further, the “snail mail” method of paying bills with a paper cheque can take seven to 10 days, and lead to a missed payment due date. Online payments take seconds to initiate, and the process is complete in a matter of hours.
It provides peace of mind
Online payments give customers instant access to their money, including how much of it they have, and to whom it’s paid. If a vendor fails to honor a purchase and a customer has paid for it with a credit card using online payment, for example, he/she can dispute the transaction with the creditor. If a customer chooses to store credit card information with a merchant for future purchases, or via a mobile wallet provider, he/she has money to access — without a wallet.
Despite that security breaches and cyberattacks are widely publicized, data compiled by Infosys revealed that 71 percent of consumers are comfortable sharing data online related to banking and their finances; just 35 percent did not trust that their bank had processes in place to address fraud.
For small-business owners, online payments also provide peace of mind, because online payments offer customers payment flexibility to pay for goods or services rendered using their debit or credit card, it may be less likely that merchant invoices go unpaid. When customers do make online payments, funds owed to merchants are often transferred electronically to a business account in a few business days.
Online payments are a means to purchasing from a variety of merchants, but they also give customers convenience and control over their finances and purchase experience. Ultimately, they’re a win-win for customers and the merchants who accept them.
Chief Marketing Officer, Kristen Gramigna, of BluePay has more than 20 years experience in the bankcard industry in sales management, direct sales and marketing. Follow her on Twitter at @BluePay_CMO.