5 Digital Payment Trends Ag Retailers Should Know

By Andrea Mowers, ARA and Danielle Schinke, Keybank

Economic and social changes during the past three years transformed and sped up payment trends in the consumer landscape. Now, 82% of Americans use digital payments and digital payment technology. More people are familiar with money-transferring apps such as Zelle and Venmo. Wallets and credit cards have moved to your smartphone, and you can make purchases for products you want now and pay for them later.

These nontraditional payment methods create some exciting opportunities for agricultural retailers. But you may wonder how to adapt and what you can do to stay ahead of the curve. 

Here are KeyBank’s top five tips to help you take advantage of emerging digital payment trends, make the most of what we’ve learned from the pandemic and understand what experts are predicting for the future of payments.

Contactless Payments and Cashierless Technology
Forecasters suggest nearly 75% of Americans will use digital wallets regularly by 2025. These tools make transactions easier by allowing quick scans and easy checkout using contactless technology at the point of sale (POS).

Contactless, or tap-to-pay, cards are also becoming more common. Shoppers with cards that feature the RFID symbol can forget the swipe and chip reader and go “touch-free.” The cards take advantage of modernized payment terminals with fast tap-to-pay transactions that minimize physical contact and keep cards clean.

QR codes are another payment industry trend that recently made a huge comeback. Once thought to be an ineffective gimmick, these handy printouts have been a great solution for brick-and-mortar businesses seeking to remove hand-to-hand interactions in favor of a mobile phone’s camera. QR codes can also be used for rewards and promos to connect shoppers directly to your customer database via a POS system.

Increased Security
With more digital payments comes more exposure. Efficient cross-border transactions are becoming an integral part of the economy, and enhanced security and fraud prevention measures are must-haves to keep sensitive information away from prying eyes. Businesses look to artificial intelligence and machine learning to lead toward a safer, more secure digital experience.

Improvements in customer authentication processes — examples include facial recognition and biometrics — offer much needed peace of mind to clients who rely on mobile devices. 

Having the right tech makes all the difference because a valid data security standard certificate from the Payment Card Industry Security Standards Council notably reduces security breach risks.

Going Omnichannel
Pivoting to omnichannel is one way many businesses find success. With brick-and-mortar locations suffering, e-commerce readily took center stage. Subscription services blossomed and created recurring relationships.

B2B branched out to B2C and vice versa, and newer channels of sale such as social media came into their own to offer entirely new ways to market and move a product.

As the world inches back toward normalcy, optimizing these new channels is key to keeping your digital presence profitable while brick-and-mortar takes back its piece of the pie.

Embedded Payments
With e-commerce emerging as the go-to way to shop for many, the need for embedded banking and payments is on the rise. What separates merchants from financial service providers is becoming less defined.

Merchants can now use digital platforms and marketplaces to offer their clients easy POS options without the need for a traditional merchant account. As a result, new businesses can start accepting electronic payments online and in-store almost instantly.

Financial service providers are changing with the times, too. They’re making room for APIs and other financial technology — or fintech — designed to fit the modern business’ need for digital transactions, real-time payments and financial interconnectivity without the traditional friction and pain points.

Peer-to-Peer Payments
Replacing cash and check, instant transfers through providers such as Zelle and Venmo take the processing time out of sending and receiving payments. The money travels fast and doesn’t require physical contact.

Plus, these systems are easy to use and overcome some traditional banking barriers such as complex bill pay systems and slow requests for payment. As these services look ahead, they may place even more emphasis on widening payment options beyond traditional credit; examples include investments, stocks and cryptocurrency.

Of all the things we’ve learned from living through and conducting business during the past few years, one thing we already knew stands out: change is the only constant. KeyBank offers a variety of merchant solutions and can help set you up for success and make your customers safer, happier and more likely to return.