Intrapay, a recently launched payments company within the Sappaya ecosystem, has announced the results of its new consumer survey into the consumer ecommerce experience and the demand for different payment methods provided through online retailers.

The results suggest that consumer demand for cryptocurrency, both now and in the future, falls well short of hype within the Bitcoin bubble. Consumers are currently more than seven times more likely to buy something online with a prepaid card than via cryptocurrency, and more than twice as many would like to use prepaid cards in the future, rather than the volatile digital currency.

Less than 2% of consumers have used cryptocurrencies and only 6.5% wish to use it to buy items online in the future. Meanwhile, as consumers become increasingly security-savvy, demand for prepaid cards almost doubles, from 9% currently to 17% who wish to use them online in the future.

Koen Vanpraet, CEO of Intrapay, commented: “Cryptocurrencies may have enjoyed plenty of hype over the last year, but are just not viable as a mass payment method in the current market. Retailers looking to grow must understand consumers and offer the payment options that will drive loyalty, engagement and conversion.

“This cannot come from forcing unwanted payment methods on them: it must come from listening to retailers and their consumers, meeting their needs with payment methods that truly engage the consumer and add value to the business.”

The survey of over 650 consumers also revealed:

• Consumers want payments to give them more control of their money: spreading the payments across the year; receiving real-time updates on the payment status; and receiving help with budgeting.
• Hidden delivery charges are the second-largest reason for abandoning a transaction – over 50% of respondents failed to complete a purchase when faced with unexpected extra charges.
• 50% of consumers have abandoned a transaction after being required to enter too many details into an online checkout.
• Direct debit, debit cards and credit cards remain the most popular method of purchasing goods online but demand is falling, in favour of alternative payments, including prepaid cards, bank transfers and mobile payments.

Almost 90% of respondents reported that security is one of the most important aspects of their online payment experience, while four in ten demand greater convenience, with an equal number highlighting speed of payment as one of the most significant factors.

Paul Winslow, Chief Marketing Officer at Intrapay, added, “Security versus convenience is still a significant driver in consumer behaviour online, but what our research shows is a shift to new, innovative alternatives, and greater transparency from merchants and their payment partners. At Intrapay, our ethos centres around the customer experience: if they demand it, we will build it. The consumer is in control of the payment and future ecommerce success will depending on listening to these voices, building the adaptive technology based on what consumers want, rather than what businesses tell them they want.”

(Source: Intrapay)

As you likely already know, China’s e-commerce sector is the biggest in the world right now. Below Finance Monthly speaks to Ronnie D’Arienzo, Chief Sales Officer, PPRO Group, who lists some ways we can all learn from China’s excellent performance in this sphere.

A few weeks back China’s 1.3 billion population celebrated Chinese New Year and the start of the Year of the Dog. The celebrations lasted for sixteen days, starting on New Year’s Eve (15th Feb) to the Lantern Festival on March 2nd. Preparation for the New Year celebrations is known as a ‘shopping boom time’. Many transactions will be completed this week in preparation for the two weeks of celebrations. Interestingly, the majority of these transactions will be completed using local payment methods, specifically e-wallets such as WeChat Pay and Alipay.

The Chinese e-commerce market is booming; research from PPRO Group found the market is worth a staggering $865 billion with growth rates higher than - the total UK e-commerce market. So how can UK businesses take advantage from China’s healthy ecommerce market? PPRO Group has pulled together seven considerations for UK retailers, when looking to attract the attention of the Chinese consumer.

1. Each year, Chinese e-commerce grows by more than the total amount of the entire UK e-commerce market

In 2018, Chinese e-commerce will grow by $233.5 billion. That’s $30 billion more than the total value of all goods bought online in the UK.

2. Chinese online shoppers spend $208 billion a year using credit cards which UK retailers don’t accept

96% of Chinese credit cards are issued by local schemes and only 4% of all online transactions in China are made using international credit cards, such as Mastercard and Visa. If retailers don’t support local schemes, they’re cut out of a $200 billion market.

3. Don’t miss out on $650 billion of online spend using alternative payment methods

Every year, Chinese consumers buy $650 billion worth of goods using local bank transfer apps, e-wallets, cash-on-delivery services and other locally preferred payment methods.

4. Every year, Chinese online shoppers spend over $100 billion just on clothes

Fashion is the most popular item for Chinese online shoppers. Each year, Chinese online clothing sales are worth more than the entire UK fashion industry.

5. One Chinese e-wallet has more users than there are people in the EU

The Chinese e-wallet WeChat Pay has 980 million users compared to 500 million people in the whole of the EU. In 2017 alone, WeChat Pay was used by Chinese consumers at an average rate of 1 million transactions per minute.

6. M-commerce in China is worth $173 billion

Every year, the Chinese spend almost $200 billion from their mobile phones. And with China spending $400 billion on 5G, the number of mobile users is set to rocket in the coming years.

7. 40% of all global e-commerce sales are made in China

The Chinese share of all global retail sales is around 30%, but for e-commerce sales, it’s 40%. And that number will grow as more people come online.

Want to sell to the world? Start with China.

Mobile shopping in the UK, France and Germany accounted for 28% of online Christmas orders in 2016, according to CJ Affiliates, with the UK bringing in an even bigger proportion at 44%. And these figures are set to grow even more in the lead-up to the 2017 festive period.

According to Keiron Dalton, mobile banking expert from Aspect Software, with the Golden Quarter set to see another boom in mobile payments and complex transactions, the opportunities for fraudsters to make their move on the shopping public is higher than ever. Keiron, head of Aspect’s global digital identity division, also argues that fraud that relies heavily on social engineering and bypassing weak security processes, such as SIM Swap, is seeing an upward trend in the UK and other regions, including Africa. According to Keiron, fraudsters not only take advantage of the upswing in mobile payments activity, but the sentiment surrounding the holiday for a lot of people.

Keiron explained: “SIM Swap fraud occurs when a criminal registers an existing phone number of a victim on a new SIM card by impersonating the victim to the mobile phone provider. Once activated, a criminal will receive all the calls and SMS notifications sent to the victim’s mobile number and can deactivate the original SIM card in the process. Once in control, criminals are able to bypass SMS-based one-time-passcodes, and steal large amounts of money quickly. This often happens before the victim is even aware they have been targeted.”

“We are working closely with the GSMA, as well as with a number of big banks and leading mobile network operators in the UK and in the rest of Europe to build a collaborative effort to fight new types of fraud like SIM Swap, but consumer awareness of the crimes has stayed relatively out of the headlines. If your phone or SIM card has been compromised, there are a number of tell-tale signs to look out for before it gets too far,” Keiron said.

1. Phishing messages and suspicious communications asking for information

SIM Swap fraud requires the hacker to have access to a victim’s bank details. These are often obtained through an email phishing attack, unsolicited communications asking for details, or by purchasing that information from online crime gangs. You should never respond to these types of communications or send your bank details on any platform that could be read by someone else. Your bank will never ask for this information so don’t be fooled by fraudsters imitating your bank. This leads to the initial opportunity to get account access or access to a duplicate SIM card; it also could provide criminals with the answers to personal security questions.

2. Extended loss of signal

Once SIM Swap fraud has occurred, it is not instantly noticeable to the victim. Extended loss of signal is the initial sign that SIM Swap fraud has taken place, as the control has been switched to a new device. Contact your mobile network provider to check if it is a widely known issue, or isolated to your device.

3. Floods of calls and messages

This is a tactic that runs parallel to the extended loss of signal. Criminals will send a flurry of nuisance calls and/or messages in an attempt to get victims to turn their phone off. If you’re suspicious, it’s vital that you don’t turn your phone off as this is used as a distraction to delay you noticing a loss of service when a SIM is swapped.

4. Opening links on your phone

Whether the link is sent to a victim via a phishing message or is on an unknown website, mobile phone users should be cautious when opening links on their device, and delete anything suspicious immediately. Hackers can use links that contain application packages that, if installed, will give the people behind the malware administrator rights to the victim's device.

5. Be aware of the source of any applications you download

Only download applications or make in-app purchases from approved sources or stores. To prevent suspicious applications from being installed, Android phone users can go to Settings/Security and turn the ‘Unknown Sources’ option off, which will stop the phone installing them from anywhere other than Google Play.

(Source: Aspect)

Last weekend, British shoppers were predicted to have spent almost £8bn on Black Friday sales – nearly four percent higher than last year. While this busy shopping period is certainly good for the British economy, it raises concerns about the opportunities for scammers and cyber criminals. Ross Brewer, VP and MD EMEA at LogRhythm, discusses for Finance Monthly below.

Indeed, all eyes have been on who – and there will be some – will fall victim to hackers’ increasingly persistent and clever tactics. Retailers are prime targets because of the confidential data they hold – whether it’s bank details, email addresses or personal information. There’s absolutely no doubt that cyber criminals will have tried to take advantage of the past week’s online sales peaks to access networks unnoticed or execute malware that has been sitting on the network for months. Retailers have a lot to prove when it comes to showing consumers that they are taking modern-day threats seriously.

As we only saw this week with Uber, it isn’t always a breach that makes headlines, it can be how it’s contained and disclosed. In such a competitive industry, retailers rely heavily on loyalty, which means reputation is key. They need to understand the true value of the data they hold and take the necessary steps to protect it.

Monitoring and detection is key

It’s hugely important that retailers are investing in tools that continuously monitors networks for any signs of a compromise. Indeed, online activity and network communications between components in the card processing chain need to be tightly controlled; a process that is specifically mandated by PCI-DSS. With time increasingly of the essence, it is also critical that, rather than simply scanning for threats and raising an alarm if something suspicious is identified, these systems are able to deliver actionable insight with supporting forensic data and contextually rich intelligence. Not only does this ensure that the right information is delivered at the right time, to the right people, but it guarantees that the appropriate context will be attached, significantly decreasing the amount of time it takes to detect and respond to threats.

Most retailers know by now that they cannot afford to take shortcuts when it comes to cyber security. With breaches now a case of when, not if, it’s essential that they are on high alert at all times – particularly during busy shopping periods. Despite growing concerns over the cyber threat, consumers are spending more and more money in store and online each year, but retailers cannot take this for granted. It only takes one data breach to damage a company’s reputation, hinder future sales and/or disrupt pending investments and deals.

The good news is that security intelligence has become so advanced that companies can now automatically detect a compromise as soon as it happens, enabling security teams to stop a cyberattack before any damage is done. With GDPR only a matter of months away, enterprise organisations and retailers are feeling the pressure to identify, mitigate and disclose an attack at the time that it happens. Only with rapid detection and response capabilities will retailers be able to take cyberattackers head on and protect their customers.

The holidays are upon us, and that means consumers are limbering up their mouse-clicking fingers in preparation to go shopping online. Online shopping is now mainstream and consumers are expected to spend more than £600 billion online this year, up 14% from a year ago. More than three-quarters of mid-sized to large retailers now sell goods and services over the web.

In the wake of the many recent and prominent cyberattacks, it’s reasonable to be concerned about how safe your online shopping experience really is. To check, we analysed a dozen of the UK's largest online retail sites to evaluate their policies and procedures regarding privacy, security and information sharing. The good news: all have good security practices when conducting transactions. The not-so-good news: password policies, information sharing and general disclosure practices are all over the map.

Here are some things to look for, based upon our research.

Secure browsing

HTTPS is a version of the standard HTTP protocol that adds an extra layer of security by encrypting traffic between your device and the server. Some organizations, including Google and the Electronic Frontier Foundation have been pushing website owners to adopt HTTPS for all communications. In light of that fact, it’s surprising how many of the sites we visited don’t use this more secure standard for casual browsing. To be clear, all employ HTTPS for secure checkout, but several don’t make the switch until the customer logs into an account or heads for the checkout aisle.

There are reasons for this. Not all browsers support HTTPS, so requiring its use for simple viewing may lock some customers out of the site. However, the volume of non-HTTPS-compliant browsers is shrinking and the benefits of secure browsing are compelling enough that it’s worth checking when you visit the site. It’s easy to do; simply look at the URL in the address bar. If you see “http://” or nothing at all before the address, then HTTPS isn’t being used. That means that someone who can tap into your communications can see pages you are viewing or information you’re sending. Pay particular note, if you are accessing a shopping site over a public Wi-Fi network.

Privacy policy

Online retailers are required to post privacy policies by law. However, that doesn’t mean all policies are the same. That’s likely to change next May, when the General Data Protection Regulation goes into effect. Those are the rules that define how organizations operating within the EU must store and protect personal information about EU citizens. Enactment of GDPR should create a more level playing field, but in the meantime there are variances in details about the use of your personal data to look for.

A good privacy policy should be easy to find, easy to navigate and written in clear language. We found considerable variations between retailers in this area. Some bury sections of their policies in dense, nested menus or use legalese like Asda’s "By letting us have any sensitive personal data, you expressly consent to us using and telling others about any of your sensitive personal data so we can provide you with the goods or services requested by you in the way set out in this Privacy Policy.” Huh?

Others take time and care to craft a policy that is visually attractive and easy to navigate. Particularly notable is John Lewis, whose security policy amounts to a mini tutorial on good password practices. It even has advice on malware and phishing protection. Tesco also has an outstanding privacy center, with advice on how to protect against social media scams and even keep your gadgets safe.

Information sharing

Most e-tailers pledge not to use your contact information for anything unrelated to a transaction or a related service. However, some will contact you for market research studies or to get your feedback on their services or the website. Look, in particular, for language like "carefully selected third parties may use the information we collect to inform you about offers, products and services.” This means your contact information is being shared with companies or list services other than the one you’re doing business with, most likely for marketing purposes. Most retailers will let you opt out of such communications, but the responsibility to do so is yours.

A variation on this practice is to share information within a family of companies. For example, Marks and Spencer plc also runs its own bank and energy businesses and shares customer information between them. Retailers must disclose these practices in their privacy statements. If you’re uncomfortable with having a company that sells you clothes also pitch you on mortgages, opt out of the deal.

Speaking of opt out, practices also differ on email contact. Most retailers opt you into their email marketing programs and leave it up to you to withdraw. In some cases, you can opt out at the point of payment or registration, but others require you to go into your personal profile and change your preferences, or to unsubscribe once the pitches start arriving.

Payment information

Policies also differ on retention of credit card information. Some companies keep payment number by default, while others ask your permission. This information should be laid out in the privacy policy or stated on the registration page.

The convenience of saving your credit card on a retailer’s website is undeniable, but there’s also a risk involved, as evidenced by the many breaches of prominent brands. A safer course of action is to use a password manager that also stores payment information so that you can control access to this sensitive information. For one-off transactions with retailers you don’t know very well, we recommend against permitting payment information to be stored at all.

Password policies

Retailers love it when you become a member because it open new avenues to market their goods and services. While there are many benefits to membership, be wary of how much information you give up upon joining. We recommend you limit yourself to providing only that which you would be okay with exposing in the case of a breach.

Pay particular attention to password security. Our research found the greatest variation between websites in that area. For example, BooHoo requires only that passwords be at least five characters, despite the fact that the site offers to store payment information. This is unacceptably weak security, in our view. Most sites specify a minimum of six to eight characters with a combination of upper- and lower-case letters and symbols, which is considerably more secure. A few offer strength meters, which assess the security of your password as you type. The more guidance the site offers the better. No matter what the requirement, use at least an eight-character password and avoid easily guessed substitutions, such a “1” for “l.”

Checkout

All the retailers we visited provide secure checkout using the SSL protocol. Most also list multiple secure certifications on their payments page, such as Verified by Visa, MasterCard Secure Code and American Express SafeKey. The more of these badges you see the better.

Some retailers offer to save your payment information at the point of sale. As noted above, we recommend against this practice. Some also use checkout to try to sign you up for their mailing lists or third party offers. If you already receive enough marketing messages, keep an eye out for this practice, since most retailers automatically opt you in and require you to make the effort to remove your name.

Summary

The profusion of recent security breaches should have every retailer on high alert to safeguard customer information. While all the sites we visited do a good job of covering the basics, we found significant variation in attention to detail. That doesn’t mean the more attentive sites are necessarily more secure, but if given the choice, we prefer to spend our money with companies that give protection of our personal data more than just lip service. Enjoy the online shopping season, but be careful to give up no more information than is really needed.

(Source: Keeper Security)

According to recent figures recorded by HIS Markit for Visa, the UK is to expect a 0.1% dip in spending this Christmas period, during the key shopping months of November and December.

Physical store spending is expected to drop 2.1% on the high streets, while in contrast, online sales are expected to rise 3.6%. Online spending for the same period will also account for a record share of the shopping spend, as for every £5 spent, £2 would account for online sales.

Over the past few years, shrinking figures for high streets shops in the Christmas period have been attributed to rising personal debts, interest rate rises, static or lower wages in the face of increasing inflation, and the current weak phase of the pound.

Rob Meakin, Managing Director at Loyalty Pro had this to say for Finance Monthly: “Consumer spending always fluctuates over the calendar year, but the news that Brits could spend less on Christmas for the first time since 2012 is a grim wake-up call for retailers as they approach their busiest and most profitable period. With consumer confidence already low, retailers will have to claw back the attention of their audience and change the overall sentiment that looks set to discourage shoppers by offering their customers rewards for their loyalty. Regular Christmas deals are no longer enough with rising prices and inflation set to impact customers’ appetite. Retailers, if they haven’t already, need to understand the ‘membership economy’; consumers want to feel part of an exclusive club and with fewer pounds to be spent, consumers will be looking at the best deals from the retailers that understand them best. Loyalty is under threat, but a personalised and reliable strategy will trump most other approaches.

“Putting personalisation at the heart of everything on offer will instantly add value to the customer experience. Loyalty schemes are another sure-fire way to extend the customer’s journey and build a long-standing relationship that encourages growth through periods of uncertainty. It’s also the exact reason why high-street vendors such as Boots and Sainsbury’s prosper during high-pressure peak periods; Boots constantly sends its customers exclusive offers tailored to their shopping habits, while Nectar points organically drive shoppers to the grocer. The one truth in all of this is that customers will not wait around for the best service, they will demand it. And a mix of personalised bargains and loyalty solutions could be the differentiator between a successful or unsuccessful Christmas.”

Ray Dalio, the founder of the largest hedge fund in the world, told Henry Blodget that investors should have 5% to 10% of their portfolio in gold. During that same interview, Dalio called bitcoin a "speculative bubble" and said "bitcoin is not an effective medium exchange by and large" and "it's not easy to buy things with the bitcoin."

Dalio isn't the only one asking these questions about bitcoin. If bitcoin really is a currency, then it is important that you can buy things with it. But this may not be a fair argument. We all seem to accept gold as a storehold of wealth and as an alternative currency even though you really can't make purchases with gold.

So in an effort to fairly compare gold and bitcoin in this vein, we went out into the world to see how easy it was to spend both in everyday transactions. It turns out it isn't easy to spend either. The only person we could find who accepted gold in New York City was Donald Trump in 2011.

Bitcoin is slightly easier to spend. We couldn't use our bitcoin at Subway, which is on a few lists of retailers that accept bitcoin. Le Village, a restaurant in New York's East Village that many have reported accepts bitcoin, was closed down when we tried to eat there. But we did have some luck spending bitcoin.

We found that it was easy to use bitcoin on Overstock.com. Also, my daughter's preschool accepts bitcoin for tuition payments. But if you really want to use bitcoin in everyday transactions, you can get a debit card that allows you to spend bitcoin easily. But maybe we are simply using the wrong words when we talk about bitcoin.

As Adam Ludwin, the founder and CEO of Chain, says in his open letter to Jamie Dimon, "since this isn't about cryptocurrencies vs. fiat currencies let's stop using the word currency." He goes on to say that he prefers to think of them as "crypto assets."

Omnichannel shopping – where consumers can use multiple channels to research, buy and collect products, all while being recognised by the brand regardless of how they choose to interact – has long been a familiar concept to retailers. But as demand for an even more technology-focused shopping experience continues to increase, how can businesses take their offering a step further to better meet ever-changing customer expectations?

Finance Monthly hears from Sharon Manikon, Managing Director of Customer Solutions at Barclaycard, on what’s next for retail technology and the many ways we shop.

Staying up-to-date with the latest technology can be a challenge, but it can also hold the key to standing out from the competition, leading to increased footfall and more satisfied customers. Here, Barclaycard explores three common shopper frustrations and the technologies emerging to help businesses satisfy those needs.

Reduce fitting room frustrations with smart changing rooms

Barclaycard research reveals that three in ten shoppers (29%) become frustrated when they have to queue for a fitting room. One potential solution is to offer ‘virtual’ changing rooms, an interface in which customers upload a photo of themselves or create an avatar with their measurements, then ‘try on’ clothing items. This could prove a big hit, with three in 10 people (30%) saying they would be more likely to shop with a retailer using this technology.

Online shoppers are also interested, with 30% reporting that virtual changing rooms on a retailer’s website would help them when making a purchase. Offering ‘smarter’ fitting room options both in-store and online could therefore alleviate consumer frustrations and may even help retailers cut down on the number of items that are returned.

Keep queues short with the next generation of payments

The Barclaycard results also finds that four in ten shoppers (42%) get annoyed when they have to wait in a queue at the checkout. Payment technology can hold the key to lessening those long lines; indeed, new, faster payment methods are already helping to do this. Retailers should prepare for the increased popularity of checkout options like contactless, wearables and invisible payments.

Firstly, Barclaycard’s Contactless Spending Index reveals that half (50%) of Brits now pay contactlessly at least once a month – and this number is set to increase, with contactless spend jumping by 166% in 2016. Our data also shows that the trend to pay via ‘touch and go’ payments on a mobile or using wearables, clothing or accessories that has become more popular in the past two years is likely to continue to go from strength to strength this year.

In the longer term, invisible payments like those pioneered by Uber will gain traction, as they allow customers to complete a transaction within an app without ever hitting ‘checkout’ or walking to a till in-store. An extension of invisible payments that is currently under development is ‘scan and pay’ apps. These enable consumers to walk into a store, scan an item on their phone and pay ‘invisibly’ through payment details that they have previously input and stored on their device. Although the technology has only just been tested, one in five customers (19%) already say they would welcome apps to scan and automatically pay for items.

Retailers should expect consumers to embrace this technology in the next few years. Contactless, mobile and wearables are already starting to become mainstream, and the growth of invisible payment options will soon start to emerge as ways to pay in the retail space.

Improve the customer service with conversational commerce tools

Today’s demanding shoppers also expect more from customer service, and want quick and easy interactions at any time of day – through whatever channel they choose. According to a recent survey by ubisend, a chatbot development company, 51% of people say businesses should be available 24/7 and half (49%) would rather contact a business through messaging, such as texting, than on the phone. Companies are already using various forms of artificial intelligence (AI), such as computer systems that are able to perform basic tasks and answer simple queries, so to satisfy this demand brands should watch the AI space for applications that they can integrate into their high street stores.

As customers continue to seek out other payment options besides in-person transactions, corporations could see a rise in ‘conversational commerce,’ or the use of AI for making purchases. Already, chatbots, AI customer service tools in apps and online platforms, and digital assistants like Apple’s Siri and Amazon’s Alexa, are becoming popular stand-ins for personal shoppers and check-out counters. As this technology continues to develop, consumer demand for it across all aspects of commerce is also poised to increase.

Consumer expectations are driving exciting innovations in the retail space. Payment solutions providers are already looking forward to make sure payment systems continue to match customer demands – and businesses should ensure they are keeping up too. Not all of these solutions are ready to hit the high street, but retailers can stay abreast of new developments by speaking with their payment providers and exploring advances in technology. The brands that embrace these new tools will be most likely the ones driving repeat – and new – custom.