We’re running a series of predictions about how the ecommerce and multichannel retail industry will develop in 2021 and beyond. Today we look at new payment methods – and if they are predicted to take off in the coming year.
Cryptocurrencies still not mainstream
“Despite being discussed for years as a strong and secure alternative payment method, cryptocurrencies have still yet to become mainstream.
“Negative press around transaction times, environmental cost – a 2019 study from the Technical University of Munich found that carbon emissions from Bitcoin are comparable to that of cities like Hamburg and Las Vegas – and difficulty of use seems to be derailing adoption.
“Without a major payment service provider or retailer accepting cryptocurrency, it needs to go through a ‘larval stage’ of adoption before emerging as something merchants consider more seriously.”
Jim Herbert, VP of EMEA at BigCommerce
Cybercriminals adapt to contactless transactions
“Whether consumers are shopping online or in-person via the Amazon Go store model, there is now greater demand for contactless transactions. This will cause the definitions of card-not-present and card-present fraud to converge. As businesses cater to the consumer demand for less contact, we’ll also see a surge in buy-online-pick-up-at-the-store fraud, with fraudsters using stolen cards to buy goods online then using ‘mules’ to retrieve the items via kerbside pickup.”
Angel Grant, Director of Digital Risk Solutions, RSA Security
Contactless and deferred payments will break more than 50 years of US consumer payment habits
In May 2020, 19% of US online adults used a fully digital payment in-store for the first time during the pandemic; of those, 62% used their phones and 56% used their credit cards to make it. Alongside a growing number of contactless transaction options, including new “cashierless” options in grocery stores, US consumers are increasingly using contactless methods to pay in store. US consumer use of deferred (installment) payments will also rise significantly in 2021.
In 2019, roughly 40% of US online adults who were aware of installment payment methods had used them, but few fell into that category. But retailers and brands offering deferred payment options now also actively market them — often with vendor marketing support — to encourage customers with financial or credit concerns to build bigger baskets and entertain higher-ticket-item purchases.
Fiona Swerdlow, Sucharita Kodali, Brendan Witcher with Stephen Powers, Nicole Murgia, Forrester