More than half (52%) of South African Internet users are eager to make mobile payments, according to market research from GfK.
That means that small merchants that are not yet putting payments systems in place that support digital wallets are missing a trick.
A digital wallet is a smartphone app or web service that allows people to easily make payments for goods and services, whether they are shopping in a physical store or on a digital device. With smartphone penetration estimated at around 40% in South Africa, there’s a growing base of customers using digital wallets.
Here are five ways that Small & Medium Businesses can benefit from supporting online and mobile payments through digital wallets:
1. Offer a superior customer experienceOne of the reasons that digital wallets are becoming popular is that they are easy to use. Customers only need to enter their card, billing address and shipping address into the digital wallet app once. From then, it is stored securely on their phones and they don’t need to enter the data each time they shop on another site or app.
In store, meanwhile, customers don’t need to scratch in their bags or wallets to find a card to pay – they can simply snap a QR code or use the NFC contactless payments technology to conclude the transaction. Most people keep their smartphones on hand making it convenient to make payments when needed.
2. Attract early adopter customersOffering the latest payment technologies will help you to connect with early adopters – connected people who love technology and are always first in line to play with the new toys - and e-commerce shoppers. This can be a lucrative customer segment and may include people who are not in your traditional customer base. According to Mastercard, digital shoppers spend 10 times more than their less-connected peers.
3. Speed up the checkout process and never miss a saleBy making it as easy to pay as possible, you can speed up your checkout experience online and in-store. This not only improves the customer experience, but also enables you to run a more efficient operation at the point of sale. Making it easier for people to pay for goods on your ecommerce site will mean fewer abandoned shopping baskets and better sales. Your cashiers in store will be able to process payments faster as more of your customers opt for mobile payments over cash or plastic.
4. Become a truly omnichannel businessOnce you support digital wallets, you can enable your customers to pay you from the same device and card on every channel you support: the traditional web, mobile apps, mobile websites and your physical point of sale. This makes it simple for you to extend your presence into new channels – for example, creating an ecommerce store to complement your shop.
5. It’s easy to implementTo support digital wallets is relatively easy if you work with a new-age payments provider. Payments success is about letting your customers pay in the way that suits them – whether it’s by card payments, bank EFT, instant EFT, cash payments, or even Masterpass.
Charles Pittaway is the Managing Director of Sage Pay.