Before Amex came out with the first plastic credit card in 1959, cardboard charge cards were the norm.
But we adapted.
Before the magnetic stripe was added to credit cards in 1970 and payment terminals were created to read these stripes, the “click-clack” imprinting machine that impressed carbon paper to record transactions was the norm.
But we adapted.
Then came chip and PIN. Wireless payment terminals. Contactless payments.
The payment processing industry has been revolutionized a few times before. And we’re now in the midst of a new normal. The question is: Will you adapt to the new changes in payment processing, or risk falling behind?
Smart terminals are transforming the payment processing industry
A new breed of credit card machines hit the market a few years ago, and it’s now gaining steam with merchants: The smart POS terminal.
Smart terminals, like those from Poynt, Clover, and PAX, are unlike the credit card machines of the past. And we have no doubt it will eventually become the standard in stores across the world.
Just like the smartphone, the smart terminal can do so much more. These multi-functional devices accept credit and debit, sure, but they also come with third-party apps that help you run your business more effectively.
You can download an app to request customer feedback directly on the terminal, for example. You can download timesheets to improve employee management. You can download a gift card program app to boost loyalty or a POS app to gain advanced sales reporting and sync your accounting with QuickBooks. You can also access reporting from anywhere. The sky’s the limit.
These additional features and functionality are attractive to merchants. Small and mid-sized businesses, in particular, can benefit tremendously from smart POS terminals, which can be purchased for a fraction of the cost of a full-fledged POS system.
We expect older single-use payment terminals to be phased out over the next several years as smart POS terminals become commonplace in stores.
Alternative payments are becoming more popular every day
As consumers become more debt averse, they’re opting out of using credit cards for everyday purchases. And as they become more tech savvy, they’re seeking out digital alternatives to credit cards, like Apple Pay, Alipay, and PayPal.
This trend is already clear: More and more consumers are beginning to expect business owners to accept these types of contactless payment options, not just online but in store as well.
Offering a consistent payment experience where customers can pay with their preferred payment methods whether they’re shopping online or off will become key to maintaining customer loyalty in the future. Plus, this move will help you boost conversions and average order value, too. Fortunately, smart POS terminals can accept these types of contactless payment methods, making it easier for you to accept them, delight your customers, and meet their payment needs.
Consumers are beginning to expect instant customer financing at the POS
Similar to alternative payments, instant customer financing or point-of-sale lending has become more popular in part because consumers are looking for alternatives to credit. POS lending offers consumers more flexibility and control than traditional credit cards – and often, at better rates, too.
Customers might not have enough to pay for the goods they want right now, but they’re willing to pay for those purchases over a short period of time with equal monthly installments. And this is exactly what instant customer financing allows them to do.
Customer financing plays well with the consumer’s need for instant gratification. They can be approved for credit within just a few minutes to get the goods and services they want, without the wait. On the other hand, POS lending allows merchants to increase their average order value and upsell to higher purchase amounts, which is great for the bottom line.
POS lending allows merchants to reduce buyer hesitation and resistance at the point of sale, both online and off. It’s a win-win for both business owners and their customers. It’s no surprise then, that Accenture projects point-of-sale financing to represent a $1.8 trillion + opportunity.
Expect POS lending to become commonplace as more customers stray away from credit cards and look for more flexible ways to finance purchases. This lending option will likely become the norm for high-priced or high-value purchases, including travel, electronics, vehicle maintenance and repairs, home improvement, high-end jewellery and fashion, furniture, and appliances.
Adding an instant customer financing payment option on your online checkout page and directly on your payment terminal can help you attract more customers and boost sales.
It’s your call
It’s important to note that these are not predictions in the payment processing industry. Rather, these trends are already here, and they’ll soon become the norm in the payment space. Smart terminals, alternative payments, and POS financing are here to stay.
Consumers expect them. Forward-thinking business owners are adopting them. Will you get on board?