According to TrueLayer, 55% of respondents said they abandon transactions if the payment is slow or frustrating. Fifty-six (56%) stated that poor payment experiences make them less likely to remain loyal to a brand.
On the merchants’ side, more than half of them (56%) believe strong customer authentication is at fault. Around 35% reported a significant decrease in conversion rates due to strong customer authentication.
As a result, TrueLayer claims open banking can provide a solution for merchants looking to improve their payment processes, as well as attract and retain customers.
Nadja Bennett, Strategic Accounts director at TrueLayer, said: “Today’s report reveals the huge gap that exists between consumer expectations of the payments experience and the reality. This experience gap has significant consequences for merchants in terms of conversion rate, brand loyalty and, ultimately, their bottom lines.
“Whilst strong customer authentication rightly reflects the need to combat fraud, merchants have continued to struggle with its implementation”, Bennett added. “Alternative payment methods like open banking can deliver on consumer needs and expectations while maintaining security and simplicity for merchants of all sizes.”
The world of online payments
TrueLayer is an open banking payments network from Europe, powering faster online payments for over ten million users across 21 countries.
In May 2023, it teamed up with Airwallex, promising to enhance payment infrastructure and deliver new payment solutions and treasury operations to raise ROI for merchants.
The mobile payments market is set to grow as providers and merchants seek ways to diversify their offerings. One new concept is SoftPOS, which has recently gained some traction. SoftPOS turns a merchant’s smartphone into a device that can accept payment transactions.
Companies in the sector have even teamed up to develop SoftPOS technology. In October 2022, French provider of payment services Worldline acquired a 55% stake in SoftPos.eu, a Warsaw-based fintech transforming devices into secure payment terminals.
The purchase enabled the two to develop Worldline’s SoftPOS solution, Worldline Tap on Mobile.
Open banking, which started in Europe, is now seeing a gradual adoption in other regions. According to GlobalData’s “Key Payments Trends for 2023” report, startups like GoCardless and Plaid are key providers of open banking for financial institutions. Other competitors, such as Mastercard, Visa and Apple, are also moving into this space.