6 payment trends to look out for in 2023

The way customers pay for products and services has evolved over the past few years, with practices they adopted during the pandemic sticking around and changing their buying behaviours. 

As we enter a new year, it’s important to consider what the payment landscape will look like, so you know what to expect and can meet your customers where they are. In this article we cover six payment trends to help you stay on top in 2023. 

Payment trends you should have on your radar in 2023 

1. Combining online and offline payments

Even as shoppers return to brick-and-mortar stores, the way they get their goods and services looks a little different.

Instead of reverting back to physical cards that require paper receipts, there’s now a preference for frictionless payment methods. Designed to simplify and streamline the shopping experience, frictionless payments include mobile wallets, digital wallets, one-click online payments, auto-renewing subscriptions and in-app purchases.

Shoppers can now order online and pick up their goods in-store or curbside, on the exact same day. This option allows customers to pay how they want while still enjoying the immediacy of the in-store experience, giving them the best of both worlds.

Statista estimates that frictionless payment technology in the US market will grow to $8 trillion by 2024 – a $4.1 trillion increase from the $3.9 trillion in 2020. It is worth noting that these figures may differ for the Australian payments market.

2. Digital wallets are on the rise

Once upon a time people wouldn’t leave their house without their wallet, but now they’re doing it on purpose.

Digital wallets, which enable users to securely store digital versions of their debit, credit and prepaid cards on their smart devices, are quickly becoming the preferred payment method. Juniper Research predicts that the total spend via digital wallets in the UK market will exceed $10 trillion by 2025, almost doubling 2020’s $5.5 trillion. It is worth noting that these figures may differ for the Australian payments market.

Offering the option to use a digital wallet may provide more convenience for customers and potentially increase their likelihood of completing a purchase. Not offering this option may limit payment options for customers and could potentially impact sales. Luckily, all Tyro EFTPOS machines accept digital wallets including Apple Pay, Google Pay and Samsung Pay, so you can always say yes to a customer’s preferred way to pay.

3. More people to adopt buy now, pay later

Buy now, pay later (BNPL) isn’t a new concept, but it is expected to be taken up by more people this year and beyond.

Financial uncertainty during the pandemic led to an influx of apps that let customers pay for their goods in a series of installments, and it was a win for both businesses and customers. With BNPL, businesses are able to convert more customers by promising lower initial payments and shoppers can invest in higher-priced products without breaking the bank.

According to Juniper Research, BNPL payments are predicted to account for around 24 percent of eCommerce transactions by 2026 – a 9 per cent hoke from 2021. It should be noted that data from the Juniper Research report is based on 8 key regions across the world and may not be representative of the BNPL market in Australia.

While buy now pay later (BNPL) can provide customers with more flexibility and convenience in their payments, it also presents some risks for businesses. These risks can include an increase in default risk, an increase in administrative workload, and a reduction in profitability.

4. Contactless payments are in

Another payment trend to expect in 2023 is customers favouring contactless (or tap-and-go) payments.

According to a Visa’s Back to Business Study, around 50 per cent of all US consumers feel that contactless payments are one of the most important safety features now offered in a retail store. Another 47 per cent of consumers say they won’t shop at a store that doesn’t offer a contactless way to pay. It is worth noting that these figures may differ for the Australian payments market.

As a small business owner, it pays to offer contactless payments to your customers. Good thing all Tyro EFTPOS machines come with the highly sought-after feature!

5. Increase in embedded payments

Embedded payments are also expected to be big in 2023. Embedded payments are a way for customers to save a payment method with a business, so all they have to do to make a purchase is click a singular button – no re-entering their details again.

Statista predicts that the US embedded finance industry will bring in about $230 billion by 2025, so it’s definitely something to consider integrating into your business as the technology in this payments sector grows. It is worth noting that these figures may differ for the Australian payments market.

6. QR codes are king

QR codes are nothing new, but they made a comeback during the pandemic as businesses tried to limit the spread of the virus through money, tickets and receipts.

Today, QR codes are used for so much more including enhanced customer experiences, providing information in a cost-effective way, building your brand community, gathering valuable customer data, and initiating payments from payment providers such as Alipay – a third-party mobile and online payment platform popular with international tourists. Tyro offers Alipay acceptance¹ and we’re proud to be the first Australian provider to do so.

QR codes now exist in a number of settings including hospitality venues where diners can scan a code to browse the menu, order, and pay for their meal, and retail stores where shoppers can unlock specials simply by scanning a QR code.

According to research conducted by Juniper Research across 8 key regions, the amount of people paying via QR codes is expected to exceed 2.2 billion by 2025, equating to 29 per cent of all mobile phone users globally. It’s worth noting that these figures may differ slightly for the QR payments market here in Australia.

Wrap up

Payments are increasingly becoming digital, with more and more customers paying for goods and services online and via their smart devices.  

As a small business owner, being able to offer your customers control when it comes to where, when, and how they pay is essential to drawing customers in and keeping them around. Integrating these 2023 payment trends into your operations is a great way to set yourself up for sales success. 

Need an EFTPOS solution for your small business? Let’s chat!