“Western consumers have been using credit and debit cards since the 1970s, but digital payment methods are gaining ground, helping the industry become greener.”
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“Capitalize on revenue opportunities by issuing contactless cards in both digital and physical formats in all geographies where payment networks and acquirers are set up to handle those formats.”
“Support customers by providing online, mail and in-branch training around how contactless payments work and how money is kept secure to ensure a smooth transition to digital payments.”
“Improve data quality by making data more visible and contextual, enhancing the value that credit and debit accounts provide to the customer, including impact on their environmental footprint.”
You can access the entire report by clicking here.
For Carat’s take on the subject of digital payments, click here to check out the article below.
Gartner, Digital Payment Trend: Say Goodbye to the Plastic Card in 2023, Agustín Rubini, 1 December 2022
GARTNER is a registered trademark and service mark of Gartner, Inc. and/or its affiliates in the U.S. and internationally and is used herein with permission. All rights reserved.
Our take: Making sense of alternative payment methods
BY CHARLES WILLIAMS, VP/GM ALTERNATIVE PAYMENTS & SAM LITUCHY, VP/HEAD OF GIFT SOLUTIONS
If you are an existing Fiserv client, you already know the power of our comprehensive suite of payment solutions that help you unify your commerce, optimize transactions, and imagine and realize new ways to engage with your customers.
Chances are, you have also already implemented or are planning to accept mobile wallets, buy now, pay later (BNPL) solutions, and potentially even cryptocurrency. It’s also possible you’re following the discussion around real-time payments (RTP) and are considering when to incorporate this into your payment strategy.
Consumer adoption and use of these newer forms of alternative payment continues to grow, particularly compared to “traditional” methods such as cash, credit/debit and check, and is poised to continue. In fact, the total number of digital wallet users will exceed 5.2 billion globally in 2026, up from 3.4 billion in 2022; representing strong growth of over 53%1. However, despite the plastic card usage decline, consumers will likely keep them in their physical wallets for a few years beyond 2023, simply because you never know which payment methods will be accepted by any given merchant. Plastic cards aficionados can sleep soundly – they will be used and accepted in the foreseeable future.
One form of payment that can help reduce cost for merchants and increase customer loyalty is Pay by Bank. And while ACH payments have been around for a while, more recent Open Banking technologies are driving a growth in consumer awareness and adoption. Merchants can use interchange savings to pass value on to consumers who use it; consumers benefit from the value they get from increased rewards, cash back, discounts, etc. Moreover, current Pay by Bank solutions use the ACH payment network and can be paired with a guarantee service that will likely migrate to irrevocable real-time payment networks in the near-future, thus eliminating chargeback risks for businesses. For those of you following the move towards RTP it’s worth noting that a Pay by Bank solution today can be automatically extended to include real-time payment networks as they come online in the future, allowing you to lower the cost of acceptance even further.
Another alternative payment method that excites us is the use of branded currency, which goes beyond the traditional gift card and, when paired with a mobile app, enables retailers to offer anything from cash back, digital coupons, and wellness and loyalty incentives. Technology is again at the route of renewed interest in this payment method: Seamless integration into a digital wallet delivers omnichannel gifting and loyalty in a way not seen before. Easy-to-use, with real-time/instant gratification built in, it leads to increased customer satisfaction and engagement and creates “stickiness” that should drive repeat business and larger basket sizes.
Besides revenue growth, branded currency can also help drive significant cost savings (no interchange fees, keeping the spend in your own ecosystem) to your bottom line.
Regardless of where you may be on your alterative payments or digital transformation journey, Carat from Fiserv can help you orchestrate payments that lower the cost of acceptance and allow you to build direct relationships with your customers.