Broadening Payment Gateway Options Has Become Imperative as Digital Transformation Gap Gets Bigger

As digital transformation becomes both imperative and increasingly accessible for online businesses, the gap between the most adaptable and more primitive businesses is beginning to widen, according to research. This means it’s never been more important for businesses to build a digital presence, starting with a broader payment gateway.

According to The 2024 Digital Transformation and Next-Gen Tech Study conducted by fintech firm Broadridge, while 75% of the 500 buy and sell-side executives surveyed expressed their confidence in their tech transformation roadmaps, just 28% had reached an advanced stage in their digital skills strategies.

This represents a 4% year-on-year increase that could leave stragglers left behind. The study also found that many firms have been struggling to make the necessary investments in their digital transformation strategy, with a digital transformation gap emerging between industry “leaders” and “non-leaders.”

While the fintech landscape is constantly evolving, one of the most imperative forms of digital transformation in terms of accepting payments in various flexible and innovative ways, is fast becoming one of the biggest frontiers between these leaders and non-leaders.

With key fintech players like PayPal making recent strides in facilitating more effective digital payments for online SMEs, there’s more opportunity for this skewed playing field to be leveled.

PayPal’s Pursuit of a Positive CX

For many small and medium-sized enterprises (SMEs), the inability to offer flexible payment options within the checkout process can lead to a level of cart abandonment that pushes brands further behind their rivals throughout the e-commerce landscape.

With as much as 43% of consumers in the UK more likely to complete a purchase if a retailer offers their preferred payment option, the incorporation of the likes of Apple Pay, Klarna, and PayPal is far from the luxury it once was and is instead an essential consideration.

It’s this pursuit of a positive customer experience (CX) that has shaped the launch of PayPal’s ‘Complete Payments’ solution which is set to provide SMEs with a wider range of payment options to offer customers.

Crucially, PayPal Complete Payments offers merchants the ability to utilize a range of alternative payment options within their online checkouts. This will include PayPal, Apple Pay, Google Pay, and a variety of buy now, pay later (BNPL) solutions, as well as traditional credit and debit card functionality.

In addition to this, sellers will also be capable of synchronizing orders and tracking information within PayPal through a new ‘Package Tracking’ feature, which the global payments giant claims will provide a “streamlined resolution process” should a dispute occur.

With Airship and Sapio Research suggesting that almost 80% of consumers globally visit a retailer’s website on smartphone while 74% use a retailer’s app, the use of mobile payment functions like Apple Pay and Google Pay has become a key consideration for retailers embracing digital transformation and a positive CX.

The Road to Conversion Optimization

One of the core facets of digital transformation for retailers is to present customers with the ability to make payments in any manner they wish.

The potential loss of business for e-commerce stores should a customer add four items to their basket only to abandon their cart because their favored payment method, Bizum, was unavailable could be highly damaging.

Conversion optimization rates can be improved across the board depending on the flexibility of businesses, and for brands that cater to a wide range of customer demographics, maximizing payment potential is imperative.

This means that businesses must cater to traditional payment methods along with cutting-edge new ones. For brands that market to older customers, offering the ability to make credit card payments or bank transfers can be vital for maximizing conversions. However, for younger customers, more digital wallet or peer-to-peer (P2P) app payments may be more likely.

Fortunately, as digital transformation becomes more prevalent, so too do the integration options available to brands.

The world’s most popular online payment gateways like PayPal, Stripe, Payline, and Adyen are all straightforward to integrate into WordPress, Shopify, and WooCommerce websites, and all offer various competitive transaction fees and payment methods for customers.

In the case of Stripe, getting set up with a more adaptable series of payment methods is made simple with the distribution of API Keys, which can link account holders with their plugins for a more seamless integration experience.

Accommodating Mobile Customers

With more customers than ever opting to make purchases through mobile browsers and retailer apps, the acceptance of mobile payments has become an imperative component of digital transformation, particularly in the field of e-commerce.

Fortunately, the process of accepting payments on smartphones has been made relatively easy and affordable for businesses. Today, there are many payment processing companies out there, and most are adaptable enough to accept digital wallets as a form of payment.

In most cases, accommodating mobile customers can be as simple as upgrading an existing plan with payment processors. For the many online retailers that use processors like Square or PayPal, mobile wallets are already a core feature that can automatically expand the conversion rates of businesses.

Adaptable Point-of-Sale Technology

Digital transformation is also changing the way brick-and-mortar payments are leveraged. While upgrading storefront card readers to accept mobile payments can cost up to $500, payment processors like Square have made leveraging transactions in person far more straightforward with dedicated point-of-sale (POS) apps.

In practice, these apps behave much the same as card readers but can leverage payments using existing smartphone technology.

The implications of this are massive for the world of retail and e-commerce. Where online stores would find it difficult to focus growth on setting up a physical location in a sustainable manner, point-of-sale apps can pave the way for more pop-up stores and greater levels of participation in specialist markets.

Particularly for stores that struggle to sell dead stock, taking wares on the road on occasion with POS technology can broaden profit margins in a way that could be difficult to replicate online.

Is it Time to Think of Crypto?

Bitcoin’s recent return to the spotlight following a fresh rally towards an all-time high value will once again prompt more businesses to consider incorporating crypto payments into their digital transformation strategy.

It’s inevitable that the crypto question will continue to build momentum as long as Bitcoin carries on stealing headlines, but has payment technology progressed to the point where businesses can begin accepting the likes of Bitcoin as a payment option?

The answer to this could depend on which content management system (CMS) you ask. While WooCommerce offers functionality with leading payment providers like Bitpay, Blockonomics, Coinbase Commerce, Coingate, Pay, and NOWPayments, coverage levels are more patchy with the likes of Shopify and Magento.

Most gateways are available to add with the use of a plugin, and providers like BitPay and NOWPayments feature a relatively easy level of integration for businesses that may be less fluent in the crypto landscape.

While data suggests that very few consumers use cryptocurrency to make payments today, we can also expect the crypto landscape to continue its growth and maturation in a way that could see more payments take place in the coming years.

Digital Transformation will Hinge on Fintech

For digital transformation to be successful, businesses must utilize fintech to its full capabilities to bring more payment options and a stronger CX for their customers.

While considerations like cryptocurrency can still be part of a long-term integration plan, no ambitious business should still be left on the sidelines when it comes to accepting digital wallet payments or BNPL plans.

For the sake of a seamless customer experience and greater conversion rate optimization, the way customers can pay for online goods will leave a lasting impression on business performance.