The way we shop has completely changed over the last ten years. There’s been a massive shift towards a digital era and an even bigger change in shopping habits that has pushed businesses to think they can capitalise on it.
Naturally, when thinking about capitalising on something, you think about money, and that’s where alternative payments have come into play. The rise of buy now pay later — something 44% of shoppers now use — is thanks to the shift towards alternative payment methods – and that’s just one example.
Below, we will explore alternative payment methods and whether they should be a default.
What Are The Alternative Payment Methods?
Alternative payment methods refer to any way of paying that isn’t by cash, visa, or credit card. Gone are the days of visa debits being the go-to payment option – shoppers are spoilt for payment choices. Think about various bank accounts, e-wallets, and even local payment methods. For example, in the Netherlands, they have the iDEAL payment system, which is essentially a bank transfer payment method. In Australia, they have POLi.
The ones most of us will be familiar with is PayPal, Google Pay, and Apple Pay – a payment method that the likes of brands use to support their customers. Then you have what can be called sub payment methods. For example, if a brand was to offer PayPal as a payment method, users can then use their standard PayPal account, connect to their bank account, use PayPal Credit, or use the new instalments option.
Not every brand has jumped on board yet – and in a way, that’s detrimental.
The Stats That Will Make Them Your Default
Let’s refer back to buy now pay later. Without the option to split the cost, especially around the festive season, some people simply wouldn’t buy a product. A study completed in early 2021 discovered 56% of shoppers interviewed had recently used the buy now pay later payment services and wouldn’t have been able to afford the purchase without it.
And, it’s no detriment to a business if they pay using a buy now pay later option. The brand receives the funds from the buy now pay later vendor, and it’s then their job to ensure full payment is made by the consumer to them. E-wallets — which 36% of shoppers globally prefer to use — are even more convenient for both a business and consumer. Thanks to Apple and Google Pay, it’s now easier than ever before to shop that way.
Credit and visa cards now sit further down the list as the preferred payment method – only 37% of people use it compared to 49% of shoppers that use PayPal.
Why One Option Will Never Be Enough Anymore
The short and sweet answer is no – it won’t be enough. Offering alternative payment methods should be your default if you want to capitalise on the shift towards alternative payment methods – the statistics above show credit and visa cards simply aren’t enough. And, with more people turning to buy now pay later options as well, even instant payment methods aren’t enough.
As a business, you should explore the many alternative payment options available and which ones might suit your consumers. Perhaps you would like to try a different platform at BlueSnap that promotes All-in-one payment Orchestration that will surely increase your sales in your place and can compete globally and reduce costs.
Alternative payment methods are a dream for both businesses and consumers. For consumers, it makes it easier and sometimes even more affordable to shop. For brands, it opens up avenues for better profitability. Customers are more likely to shop with your brand if they can use their preferred alternative payment method.