Three payment trends to watch in 2024

Three payment trends to watch in 2024

As technology and evolving consumer preferences reshape the payments landscape, the imperative for corporations to stay ahead grows. Driven by consumer demands for convenience, efficiency, choice, and security, ecommerce is witnessing a paradigm shift in payment dynamics. In 2024, shoppers are looking for a seamless customer experience, including more ways to pay, smoother cross-border payment journeys, and streamlined omnichannel shopping experiences. In an era where payment technology stands as a linchpin for growth, understanding and embracing these trends will be pivotal for businesses seeking to maximize revenue, optimize performance, and stay at the forefront of the evolving payment landscape. 

Trend 1: Global expansion through hyper-localization

Cross-border sales are set to make up 33% of all ecommerce spend by 2028. Ecommerce businesses looking to expand to new markets need expert knowledge of local payment preferences in order to be successful.  57% of all online shoppers report making international purchases, and each of these customers will be looking for their favorite payment method before making a transaction. What can businesses do to streamline the payment journey for international customers, all while boosting conversion and accelerating revenue? 

Firstly, when searching for a payment partner, businesses should ensure they choose an expert that can tap into on-the-ground local expertise in their target regions and integrate the right payment mix on a market-by-market basis. For example, iDEAL is popular in the Netherlands, while Pix is big in Brazil, and POLi has widespread use in New Zealand and Australia. 

In addition, ecommerce businesses should optimize their payment page by offering the most relevant payment options in each market they operate in, including digital wallets, instant bank transfers or even cash vouchers. By tailoring the payment journey to accommodate the diverse preferences of international customers, businesses can not only enhance user experience but also increase the likelihood of successful transactions. 

Trend 2: Mobile-first commerce online and in-store

With global mobile shopping sales reaching $2.2 trillion in 2023, the focus on mobile payment methods like digital wallets and payment apps has intensified. Mobile retail is evolving into a cross-channel experience, with 67% of shoppers opting to buy online and pick up in-store. Brands need to be aware that many consumers now use multiple channels or devices to make purchases: they might browse on their mobile, make the payment on a desktop, then pick up their items from the store. An advanced omnichannel payment solution is essential for maintaining consistency across various touchpoints in the customer journey. 

Brands can gain up to 9.5% revenue uplift by implementing an advanced omnichannel payment solution that is tailored to their business model and industry. This will offer customers a consistent experience across all channels, with synchronized data and payment preferences on mobile, desktop and in-store. Businesses can also utilize consolidated reporting from all channels to increase consumer spending with personalized offers, targeted marketing, and inventory management that reflects customers’ shopping habits. 

Trend 3: The growing momentum of account-to-account (A2A) payments

A2A payments in ecommerce are projected to grow by 13% by 2026, reaching $850 billion globally. Countries like the Netherlands, Poland, India, Brazil, Malaysia, and Thailand already favor A2A transfers as the leading online payment method. In the U.S., despite slower adoption, the impact of A2A payments is expected to surge in 2024, fueled by the Federal Reserve’s introduction of the FedNow instant transfer system and potential new regulations under the Credit Card Competition Act. This trend is further propelled by the rise of Open Banking, increased real-time payment connectivity, and supportive regulatory frameworks. 

Businesses can benefit from integrating real-time A2A options, such as Pix in Brazil and UPI in India, for enhanced cash flow management, reduced payment acceptance costs and zero chargebacks. In addition, brands can increase conversions with Open Banking-enabled A2A payments. Open Banking unifies a consumer’s financial data within a single interface, reducing checkout friction and converting up to 40% better than cards. 

In conclusion, as the payments landscape undergoes transformation driven by technology and changing consumer preferences, staying ahead is imperative for ecommerce brands. From tailoring payment journeys for international customers to implementing advanced omnichannel solutions and embracing real-time A2A options, the path forward requires a strategic alignment with evolving payment dynamics. To maximize revenue and optimize performance, businesses must prioritize understanding and embracing these trends, boosting customer loyalty and retention on a global scale.  

Discover more key trends and strategies for ecommerce success in our report, “Top trends to watch in 2024”.

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