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Could 2021 be the year of the payments super app?

Smartphone technologies have been driving payments innovation and influencing customer habits for years. But the digital demands of 2020 have created an exceptional environment for mobile apps and payments, a trend that will undoubtedly endure and evolve far beyond the challenges of this year.

The demand for mobile

According to a report from Merchant Savvy, mobile accounted for 52% of online traffic in January 2020, passing the halfway mark for the first time. This growing mobile dominance is underpinned by high levels of smartphone adoption and an incoming generational wave of digital natives.

But the demand for mobile isn’t just about online shopping. The 2020 Remote Payments Study from PYMNTS shows that consumer usage of mobile devices in stores has also increased from 49% in 2019, to 72% in 2020 as consumers look to use their mobile devices to enhance their in-store experiences.

So why the big drive towards mobile? Customers want convenience – and what could be more convenient than using a smartphone – a device which most of us have within arms-reach 24/7. But more than this, mobile offers an easy way to access digital services and personalised experiences. A growing number of us are relying on mobile apps not just to shop and pay, but for managing a range of daily tasks – to research, do price comparisons, manage our finances, book a taxi, order food…the list goes on. Mobile apps give us the ability to do all these things (and much more) wherever we are and whenever we need.

The flip side of this is app fatigue. Consumers have an average of 80 apps on their mobiles, but only use a handful of them regularly. The apps that make life easier for consumers (delivering the convenience factor) are those that stay in favour.

It is perhaps for this reason that the demand for super apps is growing. Payments super apps can really deliver the ultimate in convenience and deliver an easy digital means to manage a variety of ‘life needs’ for consumers by bringing everything together in one place. After all, if you have a payments super app on your phone, you no longer need the raft of other apps to help manage finances, do your shopping, pay your bills and book your holidays; (or whatever else is on your ‘to-do’ list) one app will cover it.

Keeping connected

The demand for mobile is not just being driven by consumers. Merchants and other businesses have also had to adapt to make sure they can still engage customers without the same opportunities to physically interact.  

Many merchants understand the need to create better omnichannel interactions – to blend online and offline channels to build more seamless customer journeys. But, of course, many are wary of investment, not just because of the difficulties that this year has caused, but because developing these new customer journeys is an expensive and resource-hungry task that few can afford – even before the pandemic.

This is where payments super apps can offer a lifeline to businesses too. For instance, the chance to be part of a digital marketplace can give smaller merchants the ability to participate in m-commerce – a chance that they otherwise may not have had.

The advantages stretch far beyond retail though – many more businesses can benefit from being part of a payments super app. Charities are a perfect example – they often rely on physical fundraising – events, flyer drops, street collections etc, which have all been hard hit in recent months. Leveraging mobile can be extremely valuable in creating new ways to reach out to donors and collect funds - and a payments super app can provide the means.

2020 and beyond

Businesses that are battling through the current circumstances may take some time to recover. They still need to reach customers and build revenue, but may struggle to justify any investment in new channels and service innovations. Onboarding with a payments super app could give them the extra reach and growth opportunities, without the capital investment.

While the pandemic may have pushed the accelerator button on mobile commerce, the demand for more seamless digital interactions was already rising rapidly. Younger generations of mobile-savvy consumers are rising through the buyer ranks and looking for convenient, personalised digitally-driven services. And they’re largely looking towards the mobile channel to fulfil those needs. Merchants, banks, utility companies, not-for-profits and virtually every other business will need to take their place in the mobile world and onboarding with a payments super app can give them the means to make their mobile strategy a success.

Developing a payments super app is not a sprint, and it takes a depth of expertise and capability that few possess. So, 2021 – or even the next five years, are unlikely to see a wave of payments super apps springing up. But perhaps among those already established, we will see a market leading super app rise.

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Scott Lane

Scott Lane

Business Development Director

MobiCash

Member since

16 Oct 2020

Location

Nottingham

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2

This post is from a series of posts in the group:

The Payments Business

Share opinion and experience on how the payments landscape is changing and learn about the challenges and opportunities facing payments stakeholders in the future.


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