How COVID-19 Changed Payments & How ISVs Can Adapt
There is no denying it. The recent COVID-19 pandemic has changed the way we think about things. From social gatherings to the way we eat, shop, exercise, and work, we have had to reconsider the size, frequency, and location where we do most of, if not all of our daily activities.
How we pay for goods and services might not be the first thing that we think of when we reflect back on how life has been transformed, but the truth is that it has changed a lot too. The good news is there are plenty of ways that Independent Software Vendors (ISVs) can adapt their payment strategies to help small businesses meet their customers' evolving expectations.
Contactless Payment Adoption Accelerates
Trend: As COVID-19 spread, consumers became more hesitant to touch PIN pads or POS screens. As a result, consumer habits have changed. A recent industry survey showed that more than 30% of respondents had tried contactless payments this year, and 70% would continue to use this payment method after the pandemic ends.*
Opportunity: As the pandemic stretches on and shoppers venture out, software providers can integrate a variety of payment technologies into their software to help small businesses limit touchpoints and wait times at checkout - such as NFC enabled devices and text-based payments.
BOPS & Curbside Pickup Heat Up
Trend: This year, in-person commerce was disrupted by shutdowns and capacity restrictions. What we know now is that the most profitable businesses offered customers a way to pay online, curbside, and in-store thanks to advances like buy online, pick-up in-store.
Opportunity: Customers want a variety but need the experience to be seamless. With this in mind, software providers should look to facilitate this experience by integrating their software to a processor with technologies that will allow your customers to accept payments online, curbside, or in-store. In addition to flexible technologies, the processor you choose should also offer affordable processing rates and personalized support. It will allow you to ensure that your payment experience is scalable and will be fully supported end-to-end.
Credit Card Usage Increases
Trend: At a time where customers were most receptive to change, credit cards were still used the most by consumers - with a 9% increase from the start of the pandemic. Cash purchases were a close second. With 39% percent of TSG survey respondents preferring to use cash for in-store purchases.**
Opportunity: Enhanced pricing programs like surcharging and cash discounts have been growing in popularity with small businesses because it can allow them to offset or eliminate credit card processing fees by passing these costs to customers. Software companies can help small businesses launch and manage these programs by working with a processor to add a few simple lines of code right into their software. A processor who offers enhanced pricing will administer the program on your behalf, assisting your customers in maintaining compliance with the card brands. In addition to saving the small businesses money, these programs increase margins for software providers making the solution a ”win-win” for all involved.
Changes Here to Stay
To sum it up, as fast as these shifts have been, it looks like these trends are here to stay for the foreseeable future. The good news is, there are many opportunities for software providers that lean in and adopt payment technologies that will give their customers the flexibility that they crave and the seamless and convenient payment experience that they need.
Have questions? Want to see what Clearent can do for you?