What do consumers want and value the most when paying? Security (60 per cent), privacy (41 per cent), speed (38 per cent) and efficiency (34 per cent). While some offerings may favour one of these factors over another, open banking tailors to all of them. Nonetheless, a lack of education means people are reluctant to use it.
emerchantpay, the global paytech surveyed 2,000 UK consumers to find out about consumer payment preferences and what they value. In addition, to those mentioned, other key factors considered by consumers are the cost of the chosen payment method (29 per cent), ownership of the data (18 per cent) and account balance transparency (17 per cent).
Previously, emerchantpay found that 19 per cent of consumers said they would use open banking more frequently in five years’ time. This was a higher percentage than those who would opt for buy now pay later (14 per cent) or crypto (seven per cent).
These figures could be even higher if the government and financial organisations put a greater emphasis on open banking education. According to the research, 51 per cent of the British public had not heard of open banking. However, after being given an explanation, 58 per cent agreed that they had in fact used the method at online checkouts.
Unlocking the power of open banking
Jon Horddal, chief product officer at emerchantpay explains: “The most important preferences to consumers when choosing a payment method are all offered by open banking, so it’s of no surprise that open banking is steadily gaining popularity.
“To maintain customer loyalty and reduce the risk of checkout abandonment, merchants must keep up with consumer demand when it comes to payments. These findings underscore the importance of integrating open banking as a method that goes beyond others to provide the highest level of security, data privacy, speed and efficiency.
“To unlock the greatest benefit from open banking payments, however, merchants must help educate consumers about the advantages it offers, to encourage uptake. Despite 66 per cent of consumers indicating they’ve never received communication from their banks regarding open banking, a staggering 88 per cent expressed that transparency remains a critical factor in trusting banks and third-party providers.
“This highlights the need for educational efforts, which could be as simple as providing a brief, written explanation at the checkout.”
Offering bank transfers at checkout
The research follows the recent news that emerchantpay has partnered with TrueLayer, a European open banking payments network. Through the alliance, emerchantpay will offer payments by bank transfer as an online checkout option for merchants across the UK and Europe.
With this solution, emerchantpay’s merchants can leverage this new payment option to allow customers to instantly connect to their online banking environment at checkout for a secure and frictionless payment experience. By simply logging into their bank accounts to complete the payment, customers can swiftly complete transactions in seconds.
