Shopping via mobile is about to become more convenient.
Visa Inc., Mastercard Inc., American Express Co. and Discover Financial Services are part of the world’s biggest card networks that have come together to make easier mobile shopping with credit cards a reality for smartphone users.
Mobile shoppers abandoning their online cart costs retailers billions.
While there are many convenient ways to pay when shopping via mobile, up until now, credit cards haven’t been one of them. In fact, imputing credit card details on tiny mobile screens causes many mobile consumers enough frustration that they’d rather abandoned their online cart and the items they want to buy than finish adding all the necessary details to complete their purchase.
This “online cart abandonment,” as the industry calls it, can be very costly to retailers, who lose out on a number of sales due to this frustration.
In an effort to make an easier mobile shopping experience for credit card customers, the top credit card companies have come together to develop a checkout option that allows consumers to save their payment details all in one place.
Retailers then have the option of offering a payment button for the credit card payments, which removes the requirement to type16-digit card numbers and other data in the small boxes. This move lets credit card companies compete with other popular mobile payment options like PayPal and Apple Pay.
With other easier mobile shopping payment options available, credit card companies face an uphill climb.
While credit card companies have spent years creating their own buttons for a smoother online shopping experience (e.g. Visa Checkout, AmEx Express Checkout, Masterpass, etc.) those options have struggled with fewer than 5% of online merchants jumping on board, according to a paymnts.com survey, reports Livemint.
Furthermore, attracting retailers to feature the new credit card payment option could be a struggle, particularly with smaller merchants as PayPal has had a huge head start and is likely to be the preferred choice of many. Even now, only a handful of big-name retailers have signed on to promote the “click to pay” option.
Presently, the credit card networks do not plan to introduce any incentives or penalties to encourage retailers to roll out their new easier mobile shopping option to customers. That being said, the credit card companies have reportedly started discussions with banking partners regarding how to launch the technology.