Our world is evolving toward becoming increasingly interconnected and the demand for cross-border purchases is growing at an unprecedented rate. Businesses must quickly adapt to accommodate the demand and optimize the digital shopping experience for consumers. Customers are more likely to complete the checkout process when they can proceed with the payment methods they trust and are most familiar with. According to a HubSpot report, 59% of online shoppers abandon their cart if their preferred payment method is unavailable. Yet only less than 1% of US merchants currently accept alternative payments, losing remarkable global e-commerce revenue share.
Digital wallets are the mainstream payment method in Asia
While mobile wallets are picking up adoption momentum in the US due to the Covid-19 health crisis, they have already revolutionized the e-commerce ecosystem years ago in Asia. At the forefront, China’s digital wallets usage has surpassed cash and credit card usage combined, catalyzed by the explosive rise in smartphone ownership and social media dominance. The movement was pioneered by Chinese technology conglomerates Alibaba and Tencent, introducing social commerce as a powerful channel to captivate consumer interest, loyalty and drive consumer spending. Their payment platforms Alipay and WeChat Pay soared on top as the most popular e-wallets in China, with over one billion users combined and 93% penetration of all mobile payment population. Following their success, many other mobile wallets have emerged and continue to gain global influence, digitizing, and transforming the e commerce payment space. Some of the most recognizable platforms are PayPal, Venmo, Union Pay, KakaoPay, Dana, TouchNGo, GCash, TrueMoney, and Alipay Hong Kong. According to a Global News Wire article, the global mobile payment technology market in 2019 was approximately 290 billion USD. The market is anticipated to reach 5,500 billion USD by 2026.
Now that we are aware there’s a huge global customer base and potential revenue gain, what are the other appealing factors of alternative payments?
1. Decreased operational costs
According to Digital Commerce 360, in Q1 and Q2 of 2020, consumers spent $347.26 billion online with US retailers, an 30.1% increase compared to the Q1 and Q2 of 2019. However, the increase in online sales also means increases in transaction fees. Typically, traditional payment platforms charge merchants 2.9% + $0.3 transaction fees for online credit/debit card purchases, and up to 4.5% if they are international. In comparison, alternative payment systems offer lower transaction fees for merchants, especially on international purchases, at around 2.5% or less. Merchants can also expect faster settlement time, improved cash flow, and protection from fraud and chargebacks.
2. Improved checkout experience
Customer experience is at the core of modern online shopping. E-tailers risk losing sales in every step of the shopping funnel, thus it’s crucial to eliminate friction everywhere possible along the way to ensure customers complete the checkout process. According to a Baynard Institute study, hesitation about sharing credit card information accounts for 17% of cart abandonment, and the checkout process being too long or too complicated account for 23% of cart abandonment. Offering alternative payment methods could solve this problem. Instead of having to input credit card and billing information, customers simply need to choose their preferred payment option and fast forward to submitting payment. It’s also a more secure way to pay as transactions are encrypted, tokenized and validated, without storing and transmitting customers’ sensitive information.
3. Capture customer insights, increase loyalty and spending
Digital wallets enable merchants to stay connected with their customers, retarget them with more personalized offers, to increase stickiness and spending. One strategic approach is to create customized loyalty-based redemptions to encourage re-engagement. E-tailers can also send out personalized promotional notifications based on customers’ interests and reminders about items left in their carts.
How to integrate alternative payments with your existing checkout process?
Now that you are ready to modernize your nopCommerce store checkout process. Yuansfer can help with a plugin designed to easily integrate with your existing checkout process.
- Accept over a dozen global alternative wallets
- WeChat Pay
- Union Pay
- Alipay Hong Kong
- Boost global reach – reach 2 billion alternative wallet users globally
- Reduce cart abandonment – remove tedious credit card forms and optimize the checkout process for your customers to pay with their preferred payment methods
- Decrease transaction fees – save up to 65% on cross-border transaction fees
- Fraud and chargeback prevention – secure digital wallet transactions ensure you get the money you deserve
- Fast and secure – All transactions are tokenized, encrypted, and authenticated to ensure security without transmitting or storing any sensitive user information in the process
- Support multiple currencies – transact flexibly with foreign or your home currency
- Local settlement – two-day funding in your home currency
- Transparent pricing – no surcharges, no hidden fees, no monthly fees, and no commitment (custom rates available for merchants with large payment volume; get in touch with us to learn more)
- Enhance customer loyalty – stay connected with your customers through their digital wallets with customized campaigns and personalized promotions
- Ready for the Yuansfer checkout experience? Sign up for a Yuansfer Merchant Account and download the plugin now
- Log in to your nopCommerce account. Go to Administration > Configuration > Payment > Payment Method. Click “Configure” next to the Yuansfer option.
- Filled in the credentials provided by Yuansfer and select payment methods to activate from the drop-down menu
- Turn on the plugin by checking the “Is Active” box