Saturday, July 20, 2024
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    EDITORIAL How the payments industry is cashing in on consumer flexibility

    There can be no denying that payments are in a state of flux. The shift to digital has accelerated developments, but really consumer demand is what is really reshaping one of the most unshakable sectors of the industry.

    Increasingly, there is a desire for quicker, easier and more seamless payments – zero clicks, spread payments, subscriptions and more. All are driven by mobile: a simple search, discovery, click to purchase. It is what the consumers want.

    However, one of the things that has hampered mobile payments from becoming the de facto way to pay for everything and anything has been the huge degree of fragmentation across the kind of payment tools, the devices, networks and ability for merchants to accept payments. But that is all set to change.

    In a ground-breaking move, payment company Boku is seeking to simplify this whole process for consumers and merchants with the introduction this week of M1ST – a mobile payment network that brings together more than 330 mobile payment services effectively under one roof.

    Including mobile wallets, direct carrier billing and real-time payments schemes, the service claims that it will reach 5.7 billion mobile payment accounts in 90 countries – all through a single integration.

    That is a huge boon for merchants and, once in place, is likely to see more and more consumers using mobile to pay for everything – both online and off.

    For merchants the onboarding to handle all these different kinds of mobile payments is greatly enhanced: one simple sign up and they can, in theory at least, take any kind of mobile payment.

    It will allow for zero-click subscriptions and one-click checkouts, as well as potentially underpinning the creation of new services around mobile and mobile payments.

    Sitting in with conversational commerce, for instance, merchants can more tightly integrate engagement and payment for goods and content.

    For consumers it also has huge ramifications. According to the World Bank, 45% of consumers globally use mobile wallets verses just 18% that use credit cards for payments. This is likely to rise to more than 60% by 2025.

    As can be seen, M1ST is designed to eliminate the difficulty of mobile payment acceptance so that merchants can accept mobile payments more quickly, at lower cost, and focus on building world-class user experiences that drive long-term, valuable relationships with their customers.

    The launch comes as research by payment company Butter shows that mobile wallet payments are set to be the fastest growing payment type globally this year, rocketing up 44.5% and set to grow by as much as 54% by 2024.

    Just behind this comes Buy now, pay later (BNPL) services, which are going to see around 4% growth. Together, these two payment processes are what makes M1ST so interesting.

    Separate research of 1,000 consumers in the UK, commissioned by aimm in June 2021 finds that 93% described the process of signing up to a subscription to be clear and transparent. Just 1.5% of consumers found themselves subscribed to a service that they didn’t want.

    Unsurprisingly then, 90% of consumers felt that they alone should be responsible for choosing when to end their subscription, and 78% don’t want to sign up for a fixed term.

    Could we be about to see payment become ultra-flexible for users? BNPL using carrier billing – a sort of quasi-subscription to goods and services in several easy payment steps? Are we going to see much easier ways of subscribing to and using the already booming world of virtual reality adult content?

    Who knows? What is clear is that the digital shift and integrations of payment tools along the lines of what Boku is offering are set to make the world of payments look very different in the coming months and years.

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