Almost nine in ten consumers are frustrated with their online payment experiences – leading to the potential for an increase in abandoned checkouts, new research by open banking payments network TrueLayer highlights.
The new Payments Experience Playbook report by TrueLayer found that 55 per cent of consumers would abandon their transactions because of a poor payment experience, highlighting a need for merchants to explore alternative payment methods as a way to elevate their customer experience and drive continued growth.
Seventy-three per cent of consumers also say that slow or frustrating payment processes will make them more likely to abandon a transaction and try elsewhere. Meanwhile, 56 per cent of consumers say that poor payment experiences make them less likely to remain loyal to a brand, impacting long-term revenue for merchants.
Security also emerged as being of utmost importance to 64 per cent of consumers. Merchants are taking security seriously too, after regulators behind to introduce strong customer authentication (SCA) mandates for online card payments.
However, TrueLayer also revealed that some merchants, particularly smaller ones, are struggling to implement SCA. Seventy-three per cent of merchants with between 250 and 499 employees reported declining conversion rates from SCA.
For companies with more than 500 employees, the figure dropped to around 54 per cent. It’s clear that for smaller merchants in particular, balancing seamless payment experiences with security requirements is crucial.
“Huge gap” between consumer expectations and reality of payments
Nadja Bennett, strategic accounts director at TrueLayer, discussed the payment experience findings. Bennett said: “Today’s report reveals the huge gap that exists between consumer expectations of the payments experience and the reality. This experience gap has significant consequences for merchants in terms of conversion rate, brand loyalty and ultimately, their bottom lines.
“Whilst strong customer authentication rightly reflects the need to combat fraud, merchants have continued to struggle with its implementation. Alternative payment methods like open banking can deliver on consumer needs and expectations while maintaining security and simplicity for merchants of all sizes.”
TrueLayer discusses in the report how open banking can deliver a solution that addresses all four of merchants’ key requirements. By delivering smooth, secure and instant transactions, payments powered by open banking can help improve the checkout experience for customers.
Open banking payment providers have been required to include SCA since 2018, a head start. This means that SCA integrates far more effectively with open banking than other payment methods.
