3 Payment Trends to Watch in 2018

The 2018 retail payments scene can be summed up by 3 words:  diversity, inclusivity and security. Let’s look at how these trends will translate to your retailers’ bottom line this year.

Diversity: Plan for New Payment Forms

Retail consumers expect the option to pay however they want, and they expect payments to be done quickly and securely, with loyalty adds like sugar on top. Payment service providers should plan to help their merchants meet these expectations by providing up-to-date, customizable transaction hardware and software. Tap and pay capabilities are a must, to account for any NFC payment forms consumers may present, from phones to watches to wearables.

In addition, PSPs can help build customer satisfaction by maximizing retailer participation in added value services such as loyalty programs. This is an area that may well need a kickstart, as many merchants, especially smaller retailers, lack the time or experience to implement a store marketing or loyalty program. Fortunately, most tablet based systems offer loyalty platforms that are well-designed and easy to implement. Be sure that your retailers know how to take advantage of these tools.

Inclusivity: Work Toward Omnichannel

Every year, we’re moving closer to a real omnichannel experience. Large retailers are focusing their efforts on making sure their apps, websites and stores play well together. The ultimate goal is to provide a seamless experience for customers, and several retailers are well on their way. For instance, Walmart’s app incorporates Walmart Pay, a QR code based payment system. Walmart’s mobile platform is good for much more than just payments. It also allows customers to perform in-depth, Amazon-style product searches, place online orders and save account histories. Consumers have responded positively, with Walmart Pay adoption rates expected to beat Apple Pay by the end of 2018.

What starts at the top with large retailers generally trickles down to all areas of the market. Not only are consumers growing increasingly open to the blend of retail and e-commerce, they are expecting to participate in it. Where applicable, payment service providers may consider helping retailers develop integration with mobile apps for payment. While this may seem counterintuitive from a merchant services point of view, helping retailers gain market share ultimately benefits all parties.

Security: Technology to Beat Hackers

Just as payment forms are growing more complex, so are security requirements. Since easy pickings provided by mag stripe cards are mostly over, hackers have grown creative in their efforts to bilk businesses and consumers, particularly in ecommerce. The key to managing POS transaction security is expanding tokenization for more types of electronic payments. EMV has released payment tokenization specifications 2.0 which primarily address tokenization within e-commerce. As many retailers are looking to blend in-app payments with store pickup and checkout, these are important guidelines to follow.

While tokenization is the best anti-fraud tool we have, it doesn’t have widespread consumer trust yet. Tokenization is poorly understood by the public, who tend to be wary of any newfangled notion involving their account numbers. And considering the abominable data leaks of the past few years, you can’t blame consumers for caution. Payment service providers should take opportunities to educate their merchants about the role and benefits of tokenization. By encouraging merchants to utilize the most advanced forms of security, PSPs can help prevent costly account theft.

As a whole, 2018 promises to be another great growth year for the POS industry. By preparing retailers to meet changing customer expectations, payment service providers can secure continued growth and success for their merchants in an ever-changing payments environment.

in Industry News, Technology, Best Practices