E-commerce has become the most convenient and popular way to shop for items of all kinds. This is partly because of doorstep delivery, and partly because of the payment convenience that exists today, thanks to eCommerce payment systems.
Statistics say that the E-commerce sector in India is growing at a CAGR of 11.45% and is expected to reach a value of Rs. 7,591.94 billion by 2029. If you have an E-commerce business and wish to capitalize on this boom, you need to know about how E-commerce payment systems can help your business grow.
This blog will help you explore various ways in which payment systems have the potential to transform E-commerce businesses.
The Dynamics Of Retail
The E-commerce industry in India has grown by leaps and bounds after the pandemic receded. This transformation has helped reshape the definition of consumerism and also provided businesses with easy access to a global audience.
Geographical boundaries are not a deterrent to E-commerce businesses anymore, and neither is payment. The convenient integration of digital payment systems into the fabric of E-commerce has empowered consumers to shop for what they like and in the way they like.
Seamless payment integrations make shopping convenient, quick, and accessible. Consumers do not have to think about completing checkout or initiating payments on websites because of the enhanced reliability of digital payments today.
This has resulted in the creation of a customer who is not hesitant to initiate a digital transaction and complete a purchase.
The second major transformation has been ushered in through mobile-based applications that facilitate mobile transactions easily. Apps like Google Pay, PayUBiz, etc. (a consumer’s top choice, according to data) provide one-step or two-step payment completions with uncompromised security and high payment success rates.
As a result, businesses today have expanded their customer bases in E-commerce thanks to E-commerce payment systems. They have also gained an invaluable resource of first-hand customer data that can help inform future decisions and strategies.
One prime example is Amazon. This E-commerce giant provides customers with a wide array of payment options, spanning from EMI to BNPL, from UPI to card payments, net banking to digital wallets, and more.
Key Transformations of Digital Payment Systems in E-commerce
Digital payment systems have revolutionized every industry in numerous ways, not just E-commerce. Below are the seven key ways in which E-commerce payment systems have helped the industry evolve:
1. Cash out, wallet in
Making digital payments as reliable and trustworthy as cash itself is one of the major transformations that digital payment systems have brought about. While the population in rural India still prefers COD to digital payments, the urban population does not shy away from using digital wallets.
Digital wallets and UPI payment mechanisms have not only made E-commerce easy, but also provided a payment method that completely replaces cash in physical stores as well.
2. Personalized deals for competitiveness
The rapid growth in the E-commerce industry has led to tough competition for gaining and retaining customers. To keep them coming back, it is important to make each customer feel treasured as they associate with your brand.
Payment systems today help personalize checkouts and deals for brands by automatically selecting customers’ preferred payment methods, addresses, available coupons, etc., by understanding their payment preferences.
3. Easy price comparisons
Customers today know that they can take advantage of several offers, cashback, and deals to get the best price for an item. Payment systems on a website help customers compare the price of a product on a timeline—what the MRP is, how much discount they are getting, and how much further reduction is possible through deals and coupons.
This comparison encourages them to checkout by getting the best value out of their shopping.
4. Easy payment
Digital payments are evolving and incorporating newer technologies and infrastructure to reduce the steps it takes to complete payments. Payment mechanisms like UPI now require only two steps to complete a payment, and RFID-enabled transactions at POS require only a single touch.
The ease of payments has completely transformed how customers shop online (or at stores) without hesitation.
5. Product line expansion
Digital payment systems help brands expand their offerings by enabling innovative ways to deliver value to customers. For example, E-commerce stores offering consumer electronics can now leverage the power of embedded finance to include gadget insurance at checkout.
Furthermore, incorporating BNPL and EMIs into the payment methods helps brands include high-value items in the inventory as well.
6. Low expenses and higher operational efficiency
Digital payments have a low operational cost. All the business needs is to partner with a reliable technology provider to make the latest payment methods available. At a low cost of operation, these payment methods deliver high efficiencies by remaining active 24/7 and by delivering high success rates for payments.
Additionally, payment gateways can be integrated with accounting systems for automatic reconciliation, which helps reduce the backend manual work.
7. Better security
With the rise in digital payments, cyber risk has also increased. However, by using technologies such as blockchain and high-level encryptions, digital payments have the potential to offer reliable security.
Blockchains provide a string of immutable transaction details that cannot be breached or modified, offering a highly secure payment environment to shop.
In summary
Digital payment systems have made online shopping tremendously easy. With innovations, payment systems keep evolving into smoother, swifter, and more secure environments that customers have no hesitation in using.
For businesses, this translates into customer loyalty and trust. Explore how E-commerce payment systems work and the value they bring to your business with Plural by Pine Labs.
