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Mehret Habteab, Head of Digital Products, Visa Europe

March 2023


1 - 2 Minutes

Keeping up with the pace of change: why choice and experiences are key

Digital payments are now an integral part of our everyday lives. But the need for the consumer experience to keep up with the rapid growth in digital adoption has never been greater. So, how does the payment industry innovate to meet rising consumer expectations?

The digital revolution continues

We are living, interacting, and spending more digitally than ever before. The average time spent on the internet each day is now almost seven hours1, with four times more connected devices in Europe than its population2. Younger generations in particular make no distinction between virtual and face-to-face experiences – they expect the same highly personalised, intuitive and seamless experience from a digital interface as a physical one.

It’s reasonable to expect that consumers will demand the same convenience and simplicity to extend to how they pay. In 2021 eCommerce overtook face-to-face payments across the Visa network in Europe, reaching 53% of all transactions that year3. So, is reality living up to expectations?

Substantial progress – but there’s still work to do

Over the last few years, there’s been a significant focus on making payments more secure. The introduction of Strong Customer Authentication (SCA) has had a dramatic impact, reducing eCommerce fraud across the Visa network by 30%4. However, in doing so, it has inadvertently introduced more friction, ultimately impacting the user experience. Whilst consumers want reassurance their payment is secure; they see it as a given and are increasingly looking for more.

Alongside security and trust, immediacy is a major factor in whether purchases are completed. The average customer is prepared to spend no longer than two minutes at checkout before abandoning their purchase5. When Two Factor Authentication (2FA) is required, consumers can be subject to an average of nine screens and up to 3.3 minutes to make a payment6.

Although it’s not unusual for a customer to change their mind, issues with simplicity and convenience during the checkout experience can easily turn hesitation into abandonment. Nearly half (44%) of all European eCommerce transactions are abandoned during the payment stage with 7% on average abandoned due to additional steps required for strong customer authentication7 – the result is frustration, a poor experience, and lost sales.

Converging experience and expectation

To address this problem, experience must catch up with expectation. Much of the technology to give consumers convenience and control over the payments they make, while keeping them safe from fraud, is already out there. The next step is to bring that technology together and embed it seamlessly into every payment journey.

Consumers today want choice; options for whether they want to pay immediately, in instalments or over a longer period of time. Whilst there’s access to these options, there is a plethora of providers, with people needing to create additional accounts across a number of different platforms. But what if they could go to one provider to give them everything?

The vision for the future is for people to have access to flexible financial products that enable them to set their own parameters based on their individual circumstances, and to switch easily between different payment methods – all from one place. As populations across Europe become increasingly digitally savvy, solutions that embed payment credentials, choice, and authentication natively into the purchase experience will come out on top.

Tokenisation does just that, and is a key contributor to convenient, seamless, and safe payments for consumers. What’s more, network token capability is now being extended to embed biometric verification into the purchase experience, meaning that providers can leverage the capabilities of modern devices to offer a better user experience, with the highest levels of security.

Many consumers are used to using face or fingerprint identification to seamlessly verify payments made using their mobile device when they pay in person, so bringing that same experience to eCommerce is a logical next step. There’s no reason why any consumer, on any platform shouldn’t have the choice to go, for example, from browsing social media straight to a one-click, biometrically verified purchase on the merchant’s website using their payment method. Convenience, security and financial control – all in a matter of a few clicks.

What about a future where your car becomes a payment device? Using voice recognition you could find the nearest café, select your order, before authenticating yourself using biometrics and be navigated to collect your goods – all from the comfort of the driver’s seat.

Looking to the future

Open banking and digital identity frameworks will extend these capabilities further, by easily embedding other identity attributes – such as age, income, and address – giving consumers access to more choice when transacting online.

It's no longer possible to meet consumer expectations with a simple value transfer of payments - partnerships will be critical to building an interconnected future. An open network, connecting banks, fintechs, open data platforms, governments and more will unlock value for consumers and businesses beyond what is imaginable today.

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All brand names, logos and/or trademarks are the property of their respective owners, are used for identification purposes only, and do not necessarily imply product endorsement or affiliation with Visa.
Case studies, comparisons, statistics, research and recommendations are provided “AS IS” and intended for informational purposes only and should not be relied upon for operational, marketing, legal, technical, tax, financial or other advice. Visa Inc. neither makes any warranty or representation as to the completeness or accuracy of the information within this document, nor assumes any liability or responsibility that may result from reliance on such information. The Information contained herein is not intended as investment or legal advice, and readers are encouraged to seek the advice of a competent professional where such advice is required.

1 GWI (Q3 2021). Figures represent findings of a broad global survey of internet users aged 16 to 64
2 Cisco Annual Internet Report (2018-2023) White Paper, Cisco, 2020
3 VisaNet data: Visa Transaction volume in Europe, CP & CNP, 2018 – 2022
4 VisaNet Data: EU Fraud Rates on Authenticated and Non-Secure E-Com, January 2022
5 European ecommerce report 2021 & 2022, The State of European checkouts in 2022
6 European ecommerce report 2021 & 2022, The State of European checkouts in 2022
7 Euromonitor International, Voice of the customer: Digital Survey, March 2021

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