5 things you should know about eWallets
They’ve not long been on the radar, but already eWallets are beginning to transform the UK payments market. So, what does this mean for the nation’s SMEs? It’s great news for those wanting to seize the initiative and enable customers to pay via their preferred method.
Worldpay’s latest Global Payments Report predicts that the combined force of Samsung Pay, Android Pay, Apple Pay and others will overtake credit cards by 2020. Although the market share for eWallets (22%) in four years’ time will pale in comparison to that of debit cards (40%), it still represents impressive estimated growth.
That’s especially important given the context of another piece of recent research. We interviewed 2,000 UK consumers and found that 75% trust retailers who deploy modern technologies more than those who do not. In an increasingly fragmented marketplace it will be those offering more customer choice that perform best.
So, with that in mind, here are five key things you should know about eWallets:
A fragmented market
First there was Apple Pay. Then came Android Pay. And pretty soon there’ll also be Samsung Pay. They’re all similar platforms in offering users with NFC-supported smartphones the opportunity to pay in-store via ‘tap and pay’. Payments are secured by TouchID in Apple Pay’s case, and via fingerprint reader or PIN with the other two platforms. They all employ tokenisation for extra security. With this system, the shopper’s card number is never seen by the business . Instead, sensitive data is replaced with unique identification symbols that retain all the essential information about the data without compromising its security.
A win-win for SMEs
Thanks to the authentication security and tokenisation employed by these platforms, eWallets are incredibly secure. Plus, they allow the business to offer customers more choice to pay the way they want to. Improving the shopping experience like this is only going to increase the chances of repeat custom. It’s also quick and easy, reducing queues and potential drop-outs which can be especially important to high volume businesses such as newsagents located in transport hubs.
Expansion to the browser
Apple Pay and Android Pay have announced that users will soon be able to make purchases via their desktop and mobile browsers, in addition to existing in-app purchases. They join services like Mastercard’s MasterPass and Visa Checkout in providing customers with a simple one-click way to pay on eCommerce sites that won’t require them to re-enter payment details each time.
Wearable devices are the next frontier for eWallets. Apple Pay functionality is available on the Apple Watch, making it even easier for shoppers to tap and pay in store. Android Pay is set to come to Android Wear devices soon, and Samsung Gear S2 owners in the US can now pay for goods straight from their wrists. As more devices offer eWallets, we will likely see more and more consumers migrating to these platforms.
Retailers should consider the different types of customers using eWallets and compare against the demographics of their own customer base. eWallet usage can vary depending on age, gender and product. Worldpay research shows that mobile eWallets are most popular among younger generations and women, with the latter group leading the way in using Apple and Android Pay on their phones. Men are currently more inclined towards desktop usage.
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