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9 Payment Trends for 2021

Doug Smith & Paul Sammer
Executive Director & Vice President, J.P. Morgan

As the pandemic changed everything about daily life in the past year, merchants learned to pivot quickly. They developed and accelerated new ways to engage with consumers, who responded with enthusiasm. There are now more ways than ever to pay, a trend that will continue in 2021, as payments become increasingly seamless, embedded and contextual.

1. Cashierless tech has arrived

Checkout lines remain a major point of friction for brick and mortar retail. As cashierless technology continues to progress, retailers should be aware of the pace of innovation. 2021 may be the year cashierless stores start to bring seamless checkout experiences to consumers at scale.

2. Faster payments for consumers and businesses

The speed at which services like Zelle enable people to send money to one another has merchants wanting in on the faster payments revolution. Businesses are increasingly expecting the ability to settle and fund transactions much more quickly.

3. From subscriptions to recurring relationships

A few decades ago, recurring payments were the stuff of utility bills and car payments. In 2021, a wide range of consumer goods and services can be consumed on a recurring basis. And increasingly businesses are applying lessons from the subscription economy to create recurring customer relationships and enduring revenue streams.

4. Payments simplified

Forward thinking merchants are also looking for ways to seamlessly link digital payments with their broader treasury objectives, and for ways to reduce the complexity in payments.

5. Relentless fraudsters

The rapid shift of commerce to digital channels has created substantial opportunity for fraudsters. Card testing in particular has been a challenge for merchants. The best strategy to combat fraud is a multi-layered approach.

6. Key insights, big impacts

In response to the surge in e-commerce caused by COVID-19, many merchants rushed to ensure they had robust online and omnichannel offerings. Now that they have the fundamentals down, 2021 is about optimizing these sales channels.

7. Payments in context

Contextual commerce is all about enabling on-demand customer experiences, in channels that we don’t typically associate with payments. The contextual payment facilitates commerce any time and any place.

8. Integrated payments

It used to be that there was a clear line between financial services providers and merchants. This line is now blurring as providers offer integrated payments and banking for other companies. As a business, you can now embed financial services and offer them to your own customers.

9. Customer-friendly seamless payments

When the competition is just a click or tap away, any friction created by poorly designed or inefficient digital payment experiences can cost a merchant revenue and customer loyalty. In 2021, brands looking to optimize the customer experience should assess and benchmark their checkout and payment experiences.

What happens After COVID?

It’s been said that Covid compressed a decade’s worth of digital commerce innovation and adoption in less than a year. What’s less clear is the degree to which consumers have changed their behavior for the long term.

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