Through the internet, consumers have changed the way that they sell and buy goods and services. E-commerce or online retail has transformed the customer shopping experience. This has resulted in unprecedented growth over time. Therefore, the adoption of technology has enabled the e-commerce sector to become increasingly efficient and reachable. Technological devices like smartphones, tablets and high speed broadband have helped increase online customers. This means that banks as well as other financial institutions within the e-commerce ecosystem have been presented with the opportunity to provide secured online platforms that pay effortlessly through different payment gateways.
Mobile and online commerce have increased the need for new payment methods like E-wallets, in-app purchasing as well as peer to peer payments which contribute to the security of digital commerce. Consequently, the old payment methods like cheques or payment on delivery have been replaced by mobile and online transactions; this has increased the consumers’ dependence on online shopping.
According to Kanovich (2017), global retail sales are projected to rise from 1.9 trillion dollars to 4 trillion dollars by 2020. More people are accessing the internet and making payments through their mobile devices. This means that customers from rural or remote areas can easily be accessed. Consumers can now pay and purchase goods and services through simple mobile applications that offer compelling user experiences.
E-commerce companies must offer a variety of payment options that include debit and credit card, internet banking, and other so that they can sustain both the customers and their business. It has been found that 60 to 70 percent of all payments are done through the mobile banking options (Kanovich, 2017). Moreover, due to the complexity and difference of the emerging market, digital goods and e-commerce companies have to start partnering with the payment technology companies. Companies like NLS have a deep understanding of the banking infrastructure, robust and flexible technology, and the operational capacity to avoid fraudulent operations.
Embracing the technological changes in Payments
Even though technology and digital banking maintain as the platforms that encompass payments, consumer preferences are still evolving. Therefore, it is important for e-commerce companies to embrace digital payment innovation. This means that there is a need to improve the digital payment techniques in the e-commerce sector.
Digital payments saves costs and time which means that mobile wallets have become secure and user friendly. Mobile wallets (mostly in smartphones) offer easy payment options and help manage loyalty cards of customers for future purchase. Nonetheless, banks normally partner with e-commerce players so that they can offer lucrative offers such as secured transaction, cashback, or net banking payments. In Kenya for instance, various banks have launched mobile banking platforms as a way of promoting secure transactions through the digital platforms.
It is important for the e-commerce companies to embrace cashless payments because of its rising demand. Software solution companies offer such platforms innovatively and may increase the effectiveness and competitiveness of e-commerce companies within the digital market.