If a retailer in the current landscape doesn't offer a BNPL platform, they're behind the times. That's what customers think, anyway.
According to a new report from Worldpay, BNPL usage has more than doubled in the last year.
2018 – 2019: What’s the Difference?
One in ten Australian shoppers have used a BNPL service in 2019. Furthermore, the Power Retail Spotlight Series BNPL: 2019, shows that usage of these platforms has risen from 27 percent usage in 2018 to 39 percent usage in 2019.
The study from Worldpay also found that BNPL in Australia has grown from three percent of all e-commerce transactions in 2018 to eight percent in 2019. This is an increase of more than 166 percent.
“With their unrivalled convenience, ‘Buy Now, Pay Later’ products have emerged as an attractive option for consumers seeking an alternative to traditional credit cards and have surged in popularity over the past year, according to our 2020 Global Payments Report,” explained. Phil Pomford, the GM for Global E-Commerce, APAC, Worldpay Merchant Solutions, FIS.
Digital Payments – Paving the Way?
Digital wallets, such as Apple Pay and PayPal are on the rise in popularity. They now account for nearly a quarter (22 percent) of all online transactions. This is up by four points since in 2018.
Despite this increase in digital payments, traditional payment methods are still king. Debit and credit card payments account for 87 percent of payments made at physical checkouts in the country in 2019.
Across the globe, online shoppers are embracing the use of digital payments. A Worldpay report found that China is leading the way in digital and mobile wallet use accounting for a remarkable 71 percent of e-commerce spend. However, adoption is increasing everywhere. The report stated that 32 percent of e-commerce spend in India, 25 percent in Germany, and 24 percent in the US rely on digital wallets as a payment method.
The Future for Payments
It’s predicted that BNPL will account for one in five payments by the year 2023. Moreover, Australia’s e-commerce market is projected to be worth $US47 billion by 2023.
“As advances in technology continue to influence consumer preferences across the region, Australian retailers and merchants need to ensure they are offering the right mix of payment methods to meet expectations. Our data shows that to be competitive, retailers should be exploring new and emerging payment products such as BNPL and mobile and digital wallets to stay relevant in the marketplace,” Pomford explained.
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