Online retailers lose over £1bn annually due to lack of available payment methods
The team at www.merchantadviceservice.co.uk conducted a survey as part of an ongoing study into people’s preferred payment methods at virtual checkouts. More than 2,200 UK adults over the age of 18 took part, all of whom regularly shop online (at least once per week).
It was initially found that over two thirds of respondents (67%) find it frustrating when there is a lack of payment methods available when shopping online; of those, more than half (54%) admit they’re discouraged to complete an online purchase if the payment options are limited solely to debit or credit card details.
When asked which payment methods respondents’ favour the most (and able to pick more than one option), 71% admit they opt for PayPal, closely followed by 68% who said they tend to use digital wallets (Apple Pay and Google Pay). Meanwhile, 24% prefer Buy-Now-Pay-Later (BNPL) payments such as Klarna and Clear Pay.
Quizzed further, the top reasons respondents gave for using alternative payment methods when online shopping – as opposed to their credit or debit card – were revealed to be:
- “I’ve lost my bank card/don’t know my details” – 86%
- “I don’t want to re-enter my card details every time I shop” – 78%
- “I prefer one-click payments, it’s so much more convenient” – 65%
- “I feel safer using Paypal and Apple Pay because my details are protected” – 54%
- “If I’m shopping in bed, I can’t be bothered to get up and find my card” – 48%
What’s more, one fifth of respondents (20%) admits that every time they cannot pay with their preferred payment method, they simply abandon the purchase. Asked to give an estimate on the monetary value of the items they ‘window shopped and dropped’ each month, the average answer was £15.00.
The team at Merchant Advice Service have consequently estimated – that with approximately 50,909,098 adults aged 18 and over in the UK*, and the one fifth of respondents who admit to abandoning £180 worth of products online per year – means as much as £1,832,727,528 is lost by retailers annually due to the lack of payment methods available for customers.
Libby James, co-founder of www.merchantadviceservice.co.uk, commented: “These findings show just how crucial it is for retailers to offer alternative payment methods to just credit or debit cards, since so many now prefer using Google Pay, Apple Pay, Klarna, and so on. By limiting your payment methods, you’re equally limiting your chances of a sale if customers are unable to pay using their preference. To avoid customers falling at the final stage of checkout, consider adding payment methods that make the online shopping experience as seamless and hassle-free as possible, by offering one-click payments and more.”
