In many ways, last year was a special year – not least for the payments industry. People were challenged to rethink their usual habits. How do you make payments? How do you currently interact with companies? Has anything about that changed recently?
In our two blog posts on the Brandwatch survey in May and the official Visa press release in August 2020, we made predictions about how the COVID-19 pandemic would transform the payments industry and how the pandemic’s influence would continue to change payment transactions in the course of 2021. So how did we do? Today, we’d like to give you a progress report by telling you which of our predictions came true.
During 2020, payment transactions had to become easier as fast as possible – streamlined and contactless. Cash payments became increasingly rare as consumers started paying by card much more frequently. Mobile payments found their own social niche, gaining a level of trust that had previously been lacking.
Online retailers in particular were pushing flexible payment methods long before the pandemic arrived. In the past, e-commerce focused primarily on direct payments made at the time of purchase. So customers had already learned that payments could be made with just a few clicks. Since then, new models have started to appear – web-based invoicing, digitised payment by instalments, e-cash offers, and more. Flexibility, innovation and speed are the most impressive features of this payment (r)evolution. And like every other modern phenomenon, it has become a meme with its own special name: PayPalisation.
A consumer survey showed that 51 percent of Germans have used at least one new online payment method since the outbreak of the coronavirus pandemic. Clearly this sector is experiencing a major boom.
One of our other predictions has also come true: consumers want to keep an increasingly close eye on how much money they spend, as well as when and where they spend it. Clearly the means of payment plays a role in monitoring expenditure – which is why 45 percent of Germans admit they’ve changed their payment habits accordingly. Tools for planning and controlling expenditure have become much more important, because the pandemic has put many of us under considerable financial pressure.
Ultimately, there’s still a lot to do on the way to achieving a fully digitised payment system. Only those who follow the example of the big players in the high-tech industry will be able to close the digital gaps in their own business models over the long term. Amazon, PayPal, Klarna, Apple and others are the role models, demonstrating the excellence that’s required to smooth the customer journey. For all those who want to know more about the latest trends and modernisation requirements in the payment sector, we’ll be launching our next Certified Payment Professional certification course on 15 March 2021.