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The Future of E-Commerce Is Now What merchants need to know to maximize online sales.
V i e w p o i n T
By Kevin Dallas, Worldpay
In Viewpoints, payments professionals share their perspectives on the industry. Paybefore’s goal is to present many points of view to o er readers new insights and information. The opinions expressed in Viewpoints are not necessarily those
of Paybefore.
The global e-commerce Alternative (non-card-based) pay-
market is approaching new heights. The burgeoning industry grew 14 percent
from 2014 to 2015, and will be worth $2.4 trillion by 2019. For merchants, there’s never been a more important time to match online payment processes with consumer needs. With more than 300 payment schemes operating around the world, pinpointing the most e ective way to connect with customers is a challenge.
In the “2015 Global Payments Report,” Worldpay analyzed data from more than 100 sources around the world to better understand payment preferences and trends across 30 markets. From global expansion to payment optimization, merchants can use the report to determine which payment method best serves their target audience. Among all of the insights presented, a few distinct trends emerge.
The Rise of Alternative Payments
The convenience of online pay- ments has attracted more cus- tomers than ever before. As the variety of consumer segments has increased, so has the number of payment options available.
ment methods are projected to claim 55 percent of all e-commerce turnover by 2019, with North Amer- ica accounting for the largest shift toward such payment schemes.
Alternative payment methods, including digital wallets, prepay1 and direct debits, have grown in popularity because of their ability to meet the changing needs of in- creasingly mobile customers. (Many alternative payments use traditional cards as the funding source, al- though users are not pulling out the cards for each transaction.) Traditional payment methods, on the other hand, have seen a steady decline in use. Credit cards were responsible for 29.9 percent of global e-commerce turnover in 2014. That number could fall to 24.9 percent in just ve years.
The same holds true for debit cards, which may drop from 20.1 to
17.2 percent turnover.
As a result, merchants will continue to opt for the payment methods their consumers most prefer. Al- though the majority of consumers
in Latin and North America still rely on traditional debit and credit cards, demand for alternative payment methods is on the rise. From 2014
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1 Prepay is de ned as cards/vouchers, e.g., paysafecard, that don’t rely on traditional payment networks. Worldpay is forecasting a decline in network branded prepaid cards.