Riding the Wave of Change - How Will COVID-19 Shape Payments
The coronavirus outbreak has changed the way you work, eat, shop, socialise, do banking and make payments. While many are struggling to adjust to the new norms, we zoom into the long term impacts of the pandemic on the payments market:
1. A Strong Push Towards a Cashless Society
In early March, the World Health Organisation (WHO) released a memo that banknotes might aid the spread of the COVID-19 virus. To help curb the transmission of the virus, the WHO proposed using contactless payments as a countermeasure.
The resultant effect is the ever faster rise of digital and contactless payments. Be it in the form of websites, mobile phones or the government’s new Open Banking technology mandated under the remit of the Competition and Markets Authority, all forms of digital and contactless payments have seen a rise in usage by at least 50% across most demographics and geography since the start of COVID-19.
Experts predict that it will take a long time before we go back to what we once called the normal way of life. Eventually, this new way of doing business will be accepted as the new norm. Although it is unlikely that we will see the end of cash transactions, digital and contactless payments are here to stay.
2. The Change in the Trust Equation
COVID-19 may bring about change in the nature of trust in payments for two reasons. Firstly, the rise in fraudulent activities. As digital and contactless payment platforms make hay, fraudsters are also reaping their harvest. Common scams emerging include impersonating as relevant authorities and financial institutions to demand payments from unsuspecting prey, and fraudsters hacking into emails and changing account numbers on invoices to their own. Where you can’t be sure of the owner of the account you’re sending money to, the result is an increase in fraud - to the tune of £451m in 2019 alone, with £114 million of that being invoice fraud.
Secondly, the higher level of economic distress worldwide. With widespread concerns about delayed or cancelled orders, businesses are experiencing a high volume of cancelled transactions. The return and chargeback volumes are starting to see significant jumps which becomes a key concern for many businesses. As cashflow becomes tighter, every single payment will be watched very closely.
3. A collaborative Environment for Fintechs and professional businesses
The financial markets will be bustling with activity as new players enter into the payment market and try to take a piece of the pie. More entrants into the industry also means more competition, and more opportunity for partnerships between suppliers and distribution partners to bring about win/win situations all round. These sorts of collaborations will see different kinds of businesses working together, business services with payments providers, to offer a more complete service to businesses and consumers. The leverage of strength between both parties will yield better results for everyone over a short period of time.
4. The Drive for Digital Innovation
With more companies jumping on the digital payment bandwagon, many businesses are pressured to fast-track their digital innovation efforts; and consumers and businesses will expect to see robust security measures, timely payment updates and better analytic data on consumer spending habits.
The shift to digital has impacted all industries and virtually all forms of personal, professional and transactional interaction. As digital and contactless payments become the new norm, you need a reliable finance partner that can innovate fast enough and address these changes in the payments market. Ordo is a one-stop solution that takes care of your security, invoicing, payment and tracking. An easy to navigate app and web service, Ordo allows you to have complete security and control over your invoices, keep track of your revenue and enable you and your clients to make payments seamlessly and securely with the touch of a button. Invested in by Nationwide, Ordo is well primed to tackle this ever-changing payments market and ensure your transactions are made instantly and still safely.
Embrace this new wave of change and set yourself up for success with Ordo. Try for free at https://ordohq.com/info/
You might also be interested in
Ordo removes hassle & headache from payments, making getting paid easy. Ordo means reduced costs, immediate money transfer, automatically reconciled payments, invoice security, and happy customers. We’re FCA authorised (FRN836070), invested in by Nationwide Building Society, the former Faster Payments leadership team & CGI partners.