How Online Payment Methods Changed Commerce

How Online Payment Methods Changed Commerce

In today's world, people demand ease of use and speed. Thus, every industry is bending over backward to provide that to clients. That is particularly evident in the world of online transactions, where most sites have a bounce rate that ranges between 25% and 70%. Meaning, offering super-smooth ways to pay is essential in keeping customers happy.

The first-ever online transfer happened in 1994, three years after the World Wide Web went live, initiated by NetMarket and the Internet Shopping Network. A year later, Amazon and eBay opened their virtual doors for business, and online commerce slowly became mainstream. At first, people could only pay using credit/debit cards. However, in 1999, PayPal introduced its electronic payments system and gave birth to e-wallets. Nowadays, the number of digital payment methods is vast and ever-developing. Every few years, new options spring up, changing the way people transact, reshaping their expectations and tastes. In 2020, more than two billion people bought services or goods online, bringing the number of e-retail sales over $4.2 trillion.

They Have Changed Customer Preference

There is no doubt that online payment processors are continuously improving the customer experience. Security is a massive concern for all online shoppers. That is why in recent years' providers have upped their game by incorporating anti-fraud measures, rejecting suspicious transactions, encrypting and safely storing financial details, requesting payment authorization, and more. Most of these procedures happen automatically, with no burden falling on the users, who get instant notifications about any activity related to their online payment account.

There is less and less need for manual processes, and such convenience has led to altered expectations about the immediacy of money transfers and their security. These electronic payment systems also incorporate loyalty schemes and affiliate marketing opportunities. Therefore, customers now expect to get something out of their use and need extra reasons to choose one payment method over many other alternatives.

Digital Payments Have Redefined Online Gambling

Online gambling appeared two years after the first internet transaction happened. The industry instantly began expanding at an impressive pace. Yet, it wasn't until the invention of the smartphone and widespread internet adoption that it got a rocket strapped to its back. Now it generates over $90 billion in annual revenues.

What is unique about this sector is that it is responsible for the emergence of several digital payment methods. The famous e-wallet Neteller got conceived as a method that would exclusively cater to online gamblers. In 2000, it processed payments for 85% of global gambling merchants. MuchBetter is a Canadian payment app designed especially for the gambling industry, and Trustly is a Swedish brand that made no-account casinos a reality. These no registration casino are very popular in Finland no registration casino are very popular in Finland and around Scandinavia. These are gambling platforms where players do not need to sign-up to play slots or live tables. Trustly's Pay N Play system facilitates this via a user's BankID that connects his/her online bank account to the Trustly service.

Cryptocurrencies Provide Total Shopping Anonymity

Digital coins came into existence in 2009 as open-source software, with Bitcoin being the first decentralized currency. Each crypto works through distributed ledger technology, usually a blockchain that serves as a transaction record book. Nowadays, digital currencies are all the rage, with thousands of coins available for use. Naturally, Bitcoin is the most established and widely accepted one, with Ether on its heels, gaining traction each year.

Despite swift transfers, the other main allure of these coins is the anonymity that they provide. All transfers involving them are entirely anonymous yet completely trackable/transparent. Users can hold a crypto wallet/address without revealing anything about their identity in that piece of software. There is no central financial institution that is aware of who purchased what and when.