COMMENT: Why the days are numbered for credit and debit cards

The events of 2021 have accelerated the shift for many grocery businesses from cash to card and contactless payment options. Starbucks, Next and Ikea are just a few examples of businesses that now decline cash as a form of payment to prevent the spread of COVID-19. 

Yet, the death of cash has been coming for some time. Data from Finance UK paints a clear picture of the decline in cash payments. 

In 2009, for instance, it was found that 58% of payments were made via cash, with this number dropping by more than half to just 23% in 2019. 

Yet, while card payments have filled this void, they too look set to soon be replaced by mobile payments. 

Mobile payments made via systems such as Google Pay, Apple Pay or Samsung Pay are rapidly growing in adoption, spurred on by consumers from the millennial and Gen Z demographic. In fact, over 10 million UK adults have already registered for mobile payments, with much of this adoption coming aged between 25-34 years. 

Already representing one of the largest groups with disposable income, their influence on retailers and grocery stores, is set to grow over the coming years as they become the dominant retail force. Grocery businesses need to react quickly to the demands of these key demographics if they are to stay relevant. 

Another reason why grocery businesses cannot ignore the growth of mobile payments is their inherent ‘stickiness’. 

While their adoption continues to gather pace and consumers become increasingly used to making payments via their mobile devices, usage does appear high with nearly half (48%) of those that have registered for mobile payments in the UK using them at least once every two weeks. This usage level will only increase as more and more businesses look to accept mobile payments.  

Nonetheless, this growth is good news for the grocery sector as it creates new opportunities to interact with consumers. For instance, by focusing on mobile payments grocery stores can roll out new features that better-fit customer expectations and enable retailers to build stronger relationships with them. 

Already, we have seen retailers such as Sainsbury’s deliver scan and shop features from a mobile device, removing the need for a specific scanning device to track products and spend. By connecting this with mobile payments and loyalty cards, retailers can streamline the customer experience further by providing useful insights and suggestions to consumers as they travel around a store. 

Then when it comes to payment and checking out, apps can automatically recommend a customer’s preferred mobile payment method and reduce the number of clicks needed to complete a purchase. This greatly speeds up the shopping experience and shows the consumer that their chosen grocery store understands their needs and personalises the experience. 

In the future, apps can be developed further to not only include scanning and payment processes but also act as a guide for customers when in store too. For example, once created, an app can guide customers around the store in the most efficient route possible based on their shopping list, reducing the time spent walking around a store looking for the products they need. 

Then, once finished, they can click a button in the app and pay via their recommended payment method all entirely through the app without the need to visit a till. This is an experience that would simply be impossible without grocery stores focusing on mobile payments. 

To enable this mobile-first experience though, grocery businesses need to ensure they have the payment infrastructure in place that enables this flexibility and can support payment collection regardless of device or acquiring banking. 

Having the right system in place that enables payments to be collected regardless of device or acquiring bank ensures that customers can enjoy the first-class shopping experience. With payment solutions now available that can be quickly and easily adapted and tailored to a business’ unique requirements, shifting towards a mobile payment first approach can be easily achieved. 

The death of cash has been a long time coming and businesses have rightly prepared for it. Now the same is true with cards. Grocery businesses must act now by developing the apps and payment infrastructure needed to enable the customer experience that millennials and Gen Zers demand. Those that get ahead of the death of the payment card will be all set to enjoy long term sales success.     

By MultiPay Global Solutions chief executive David Maisey

Features

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