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How can merchants meet the consumers' appetite for digital currencies, biometrics, QR codes and Mastercard contactless payment technology?

Thursday, 09 Dec, 2021

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According to the Mastercard New Payments Index, the shift from traditional payment methods apart from cash to touch-free payments (Mastercard contactless technology) and peer-to-peer payments are moving to a new normal. The pandemic has changed the consumer’s behaviour significantly along with the adoption of new payment technologies making transactions as fast and secure and easy with convenient and trendy customer experience. What are the solutions for businesses to adapt with the new circumstances? What technology do contactless Mastercard use to help merchants worldwide meet consumer expectations?

Keep up with the emerging payment trends - Mastercard contactless payment technology

Keep up with the emerging payment trends - Mastercard contactless payment technology

I.The speaking numbers from Mastercard New Payments index

  1. In the coming year (2022), 93% of individuals who were interviewed across 18 markets worldwide will think about utilizing at least one innovative payment option, such as cryptocurrencies (eg.bitcoin), biometrics, contactless, or QR codes.

    Online interviews of 15,569 consumers in 18 countries in four regions worldwide

    • 1,000+ respondents per country in Australia, India, Thailand, US, Canada, Brazil, Mexico, UAE, Egypt, Saudi Arabia, Nigeria, Kenya and South Africa
    • 500+ respondents per country in Argentina, Chile, Colombia, Peru, and Dominican Republic
  2. Almost two-thirds of respondents (63%) said they have engaged with an alternative payment option which they thought will not be tried before the Covid19 pandemic.
  3. In fact, more than half of customers said they would avoid purchasing at companies that do not accept any type of electronic payment.
  4. Mastercard saw 1 billion more touchless transactions with Mastercard contactless payment technology in the first quarter of 2021 than in the same period of 2020, with particular acceleration in emerging contactless markets like the United States and Brazil.
  5. Nearly 7 in 10 people expect to use a contactless card this year, indicating that the Mastercard contactless technology will continue to grow.
  6. In fact, 71% of respondents say they plan to use cashless payment methods in the future.
  7. Nearly 8 in 10 respondents (79%) said they prefer to purchase at stores that have both an in-person and online presence, and 68% say they are more enthusiastic to shop at stores that offer the most up-to-date payment methods.
  8. Between Q1 2020 and Q1 2021, more than a fifth of 5,500 major Mastercard merchants boosted the number of ways they connect with customers by establishing an e-commerce channel or accepting contactless payments throughout the globe.
  9. During the same time period, Mastercard's total number of card-not-present transactions increased by more than 30%.
  10. Nearly 90% of in-person transactions globally take place at a contactless-enabled merchant, and nearly all merchant categories saw an increase in contactless transactions as a share of total in-person transactions year-over-year in the first quarter of 2021.

Source: Mastercard New Payments Index 2021

1. Cryptocurrency payments

  • In North America, Latin America and the Caribbean, the Middle East and Africa, and Asia Pacific, 40% of interviewees said they plan to use cryptocurrencies as a payment method in the coming year (2022).
  • 67% of young people in the Middle East and Africa, especially the Millennials Generation, agreed that they are more open to use cryptocurrencies to purchase products and services compared to last year.
  • Millennials are eager in learning more about cryptocurrencies, with 75% agreeing that they would adopt it if they had a better understanding of the new digital currencies.

Nowadays, consumers can exchange digital currencies flexibly. Typically with Bitcoins, many owners are able to buy and sell via peer-to-peer transactions. Somes use crypto currencies as a commodity for trading or assets for investment. While the interest of consumers in cryptocurrencies is reaching the high peaks, there are a variety of regulations that should be taken to ensure transparency, AML compliance as well as customer data protection.

Millennials are increasingly showing enthusiastic in spending crypto assets for everyday purchases - emerging payment trends

Millennials are increasingly showing enthusiastic in spending crypto assets for everyday purchases - emerging payment trends

2. Biometric payments are trustworthy emerging payment trends

  • More than half of consumers (53%) believe biometric checkout is safe.
  • In fact, 6 in 10 respondents are thrilled about biometric verification methods including gait or walk assessments and fingerprint authorization (61%)
  • Biometrics are considered to be safer than typing a pin to validate a purchase by 60% of users.

Biometric payments are considered to be safer than typing a pin to validate a purchase

Biometric payments are considered to be safer than typing a pin to validate a purchase

What technology do contactless Mastercard use regarding biometric payments?

Biometric payments are extra authorizations of Mastercard contactless payment technology to identify users at the POS. The function will test the use of fingerprint recognition or gait or walk assessment as an alternative verification to PIN or signature to authenticate the cardholder during a transaction. Fingerprint payment, based on finger scanning, is the most common biometric payment method. Gait or walk assessments can also be used to pay based on a person’s manner of walking. The payment terminal powers the biometric sensor, eliminating the requirement for an embedded battery or card recharge.

How it works

In terms of desired payment authentication for in-store use, fingerprint recognition placed first (50%) among all biometric authentications for Mastercard contactless technology assessed.

The cardholder is required to enroll his or her fingerprint by placing the finger on the card's sensor during the transaction. The tool scans the print and cross check whether it matches to the one stored in the card. The payer will receive a notification about a successful or unsuccessful transaction.

3. QR Codes - Cleaner and more convenient alternative emerging payment trends

  • In APAC, 76% of respondents think that QR codes enable them to pay in a cleaner way rather than cash. 71% of them agreed that the innovative payment method brings a convenient experience for consumers thanks to in-person payments on mobile phones.
  • In Latin America and the Caribbean, 66% of respondents anticipate using more payment innovations like QR codes in the coming year, while in the Middle East and Africa, 63% of participants intend to use more in the following year.

The above figures shows that while in the developed markets like the US and Canada, consumers prefer contactless payment methods to card presence, the rest of the world, typically emerging economies, take advantage of QR codes to connect buyers and merchants conveniently.

QR Codes - Cleaner and more convenient alternative emerging payment trends

QR Codes - Cleaner and more convenient alternative emerging payment trends

Source: Mastercard

III.Ways for merchants to tackle the higher demands from consumers

Appetite of consumers about emerging payment trends has taken the center stage in the payment industry. With the behaviours of “shop in the way customers want” have enabled merchants globally to rethink how they approach consumers and meet their expectations.

Here are some recommendations for businesses to widen sales opportunities:

Diversify their presence in both brick and mortar store and online

Diversify their presence in both brick and mortar store and online

Embrace e-commerce as a new necessary channel

Embrace e-commerce as a new necessary channel

 

Equip touch-free or contactless payment acceptance

Equip touch-free or contactless payment acceptance

Equip touch-free or contactless payment acceptance

Apply peer-to-peer pay to fasten the checkout process

Put customer security first with SCA (Strong Customer Authentication)

Adopt cryptocurrency payments especially Bitcoins

Adopt cryptocurrency payments especially Bitcoins

Put customer security first with SCA (Strong Customer Authentication) not only in digital payments but also in-store checkout

Try multiple clean payment methods with QR

Try multiple clean payment methods with QR codes to mitigate the risks of Covid19 transmission

PayCEC accepts Mastercard payments

PayCEC offers for our merchants an online payment gateway that enables their ecommerce sites to acquire online Mastercard payments from shoppers around the world.

Learn more !

PayCEC offers ecommerce merchants a Mastercard online payment gateway

PayCEC offers ecommerce merchants a Mastercard online payment gateway

Not only PayCEC accompanies our clients on Mastercard payment solutions, We’ve got more to exceed your expectations to adapt with the emerging payment trends.

  • Visa credit/debit cards acceptance
  • American Express cards acquisition
  • Crypto to fiat payment gateway
  • SEPA banking transfers collection
  • And more

PayCEC offers SMEs and Startups solutions to adopt emerging payment trends

PayCEC offers SMEs and Startups solutions to adopt emerging payment trends

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PayCEC was established in response to the growing need of businesses to accept online payments more quickly and easily. In the new media era, our payment flow has evolved to work seamlessly and effectively across all platforms and devices. We pride ourselves on combining superior technology with first-class customer service.

PayCEC is a truly global payments platform that not only allows customers to get paid but also withdraws funds to their Business accounts in various currencies.

We have created an open and secure payments ecosystem that people and businesses choose to securely transact with each other online and on mobile devices.

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We are honored to serve as your reliable business partner and financial service provider in the industry and other business-related services. With the help of our professional staff, to help merchants to achieve their goals for the development and expansion of the international business market.

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