why sometimes less is more when it comes to payments for financial services

In a world filled with cutting-edge technology and the constant buzz of innovation, it’s easy to get caught up in the race for the next big thing. Payments have not been an exception. An era of innovation has created customer expectations for personalization and ease of their shopping journeys, right down to the last key moment of checkout.

Successful payments innovation must mean different things in different scenarios. In hospitality, consumers may be open to “tech-out” and feel one step removed from a physical transaction, and in gaming, payments via a VR headset are welcome.

The same is not true when it comes to payments in financial services. When buying an insurance policy or transferring money internationally to a loved one, for example, it’s the subtle innovation that enables simplicity, reliability and security that makes for a solid payment experience.

Financial services companies need to remember that as payments innovation gathers pace, they may not need all the latest to achieve customer satisfaction. The success of this department lies in adapting the payment technology to the nature of the transaction.

The top four reasons for abandoning financial services transactions center around a lack of simplicity and accessibility: multiple transaction attempts (56%), requiring too much information (52%), too many steps (48%) or redirected to a different site. (45%). This is completely understandable: when a consumer is navigating the process of buying a complex insurance policy, for example, friction at the last minute can cause them to abandon the purchase. Clearly, ease of use isn’t just nice; is a non-negotiable.

This is where financial services companies need to make sure they use technology to set themselves up for simplicity. One-click payments, for example, are a way to ensure ease of use and smooth transaction completion: 84% of financial services consumers believe it’s important to be able to pay this way. Another quick win is ensuring that payment data can be saved to enable faster future processing, which is said to be important to 82% of consumers.

Incremental changes like these can remove considerable roadblocks and move toward a smoother payment experience.

Just because payments for financial services may not be made via VR headsets and smartwatches, that doesn’t mean it’s a one-size-fits-all approach.

Globally, more than 65% of consumers prefer to transact financial services online through apps or websites, but in Spain and France, third-party providers remain popular. The same is true when it comes to payment methods. Although credit and debit cards are a popular choice for payments for 41% of respondents combined, there is a significant share of the market open to using alternative payment options, which is most pronounced in markets such as China, where card preference falls. up to 13%.

The takeaway for financial service providers? A single channel or method approach is not enough if financial services are looking to serve global markets. To effectively engage with customers and learn where they are and how they would like to pay, financial service providers must focus innovation investments on developing a consistent, high-quality experience across all touchpoints. contact and in all methods.

Finally, the foundation of any excellent financial services payment system is security. It is the silent guardian of consumer confidence in this industry. Facilitating secure transactions is not a one-size-fits-all solution, but an ongoing commitment to safeguard against fraud and breaches, while ensuring compliance with regulations. It’s no surprise, then, that nearly two-thirds (63%) of consumers say the most satisfying aspect of their current provider’s payment experience is feeling confident that their data is safe, giving an indication of the premium imposed on the security guarantee.

In attempts to protect consumers, companies may be tempted to maximize payment security, but building the walls too high can sometimes have a negative side effect. An overly guarded approach can lead to false positives and increase dropout because the experience is too complex. Implementing an effective and non-evasive fraud prevention strategy to help mitigate this is a key factor for success.

Therefore, financial services companies should look for innovations that can be incorporated into their security strategies. For example, tokenization can help businesses securely store customer card details and protect account information. Elsewhere, fraud solutions that use extensive biometric and transactional data and scalable machine learning capabilities can further help them make intelligent, real-time decisions to manage risk more effectively.

Just because payment innovation doesn’t look the same in financial services as it does in other sectors, that doesn’t mean businesses are lagging behind. Organizations in this industry that focus on subtle improvements aren’t robbing customers of options here, they’re focusing on giving them the right ones. Payments in financial services shouldn’t compete with bells and whistles, but rather leverage technologies that enable them to consistently create better experiences, simplicity, convenience, and most importantly, security.

Silvia Mensdorff-Pouilly is Head of Business Development EMEA Enterprise at Worldpay

“Don’t reinvent the wheel: why less is sometimes more when it comes to payments for financial services” was originally created and published by International electronic paymentsa trademark owned by GlobalData.

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