Stay Competitive and Profitable With Trending Retail Payment Solutions
While many brick-and-mortar stores have reopened since the beginning of the pandemic, the way consumers shop and pay for goods has permanently changed. Retail payment processing methods are moving from physical currency to digital transactions as more consumers use credit cards and other contactless payment solutions.
However, both retailers and customers are frustrated with increased payment processing costs. We’ll discuss current retail payment processing trends and ways small businesses can stay compliant while minimizing fees.
Payments: The Current Landscape
There’s been a shift in payments, from hunting down loose change in your pockets or searching for an ATM to effortlessly tapping or inserting a card at a point of sale (POS) system. The increasing adoption of digital payments in physical retail environments has made the payment process easier for customers.
In addition, mobile payments are growing in adoption. The mobile payment market was valued at 53.5 billion in the United States alone in 2022. Experts anticipate the market to grow to over 607.9 billion by 2030.
Retail Payments Solutions to Consider
Retailers must stay vigilant about emerging payment trends and embrace changes to ensure customer satisfaction. Let’s dive into three trends in retail payment processing.
Compliant Dual Pricing
Given the rise in payment processing fees, it’s understandable that retailers are seeking an alternative method to handle charges. Cash discounting with compliant dual pricing is gaining popularity due to its ease of use and transparency.
Dual pricing deducts the cost from the advertised price when a customer uses a payment method other than a credit card. Since there’s a discount on the sale, this incentivizes customers to use cash instead of credit or debit cards. Gas stations are a common example of a business that displays the different prices for paying with cash versus a card.
Trying to keep track of the different prices by hand is far too complicated and can lead to compliance issues. With a complete retail management system, you’ll ensure you remain compliant and have checks in place, like a customer-facing display showing both the total cash and card prices.
Companies like Visa and MasterCard have been heavily reviewing cash discounts and surcharging programs for compliance. Cash discounting is legal everywhere in the US, whereas surcharging credit cards is prohibited in a few states and territories. Cash discounting is becoming a leading way to tackle retail credit card processing fees–with less concern about getting fined.
Over the past few years, there has been a significant surge in the popularity of digital wallets, offering a hassle-free method to make purchases. Mobile wallet applications, like Apple Pay, Google Pay, and Samsung Pay, allow customers to securely transfer payment information and make transactions with a simple tap or touch of their smartphone or watch.
It’s estimated that mobile wallet users will exceed 5.2 billion people by 2026. That’s more than half of the world’s population using digital wallets in just three years. Unsurprisingly, mobile wallets are gaining popularity as they offer fast, secure, and convenient retail payment processing, all through an app.
Buy Now, Pay Later (Layaway)
As the cost of living continues to rise, many people want the flexibility of spreading a purchase over time. Buy now, pay later (BNPL) or layaway is a loan that divides the purchase price into equal installments. The first payment is due at check-out, allowing the buyer the opportunity to purchase now and pay the remaining balance over time.
The Consumer Protection Financial Bureau found that from 2019 to 2021, BNPL loans from five primary lenders grew by more than 970%. By providing the option to pay in different installments, retailers can influence customers’ decisions to purchase a service or product they can’t afford in one payment.
There are a few ways to offer this type of purchasing method. Most retailers must partner with a BNPL service provider and integrate the BNPL service into their online store or POS system, which comes with specific requirements and fees. When you partner with a complete system like The General Store, your business can quickly and efficiently provide your customers with more variety without incurring heavy fees.
The General Store offers layaway and house credit lines. With layaway, customers place a deposit on merchandise for later pick up once they can pay the balance in full. House credit lines charge a customer’s account for each transaction, and the customer is billed later. Alternative payment methods simplify the payment process for you and your customers.
Investing in Payment Partners
With retail payment solutions in constant motion, finding a partner investing in competitive solutions is essential. A simple way for retailers to stay ahead is by implementing integrated retail payment processing through an all-in-one POS system.
Using a singular system that connects your hardware and software, from retail credit card processing to inventory management, is the best way to maintain overall efficiency. A complete system offers greater security and support, so you know you’re always covered.
Stay Ahead of Retail Payment Processing Trends
Today’s customers want speed and convenience, making innovations in payment processing a foundational aspect of the customer experience. Adopting a unified retail POS system with an integrated payment platform like The General Store provides a secure and scalable way to serve customers.
If you’re unsure or curious about how to stay ahead of retail payment processing trends, we can help guide you to the right solution for your business. Contact us to learn more.