Retail

FIS: Contactless Payments, Curbside Pickup Will Become Digital-First Necessities

The COVID-era embrace of curbside pickup will not only be around long after the pandemic, but could be just the thing that convinces more and more consumers to make the digital leap. After all, Norm Marraccini, senior vice president of digital payments, ACH and RTP at FIS, told Karen Webster in a recent Masterclass interview that the formula is pretty simple: “We pull up. They hand us our food. We leave.”

“As an industry, we’ve got to make it not only stupid-simple for the consumer, we’ve got to make it stupid-simple for the merchant, too,” Marraccini said. He added that it’s the quickness of the payment that people love most, and that’s why the system is beneficial to those on both sides of the transaction.

“Curbside pickup has changed the way people think — not only about the way they live, but also about the way they make payments,” he said.

PYMNTS research shows that some 60 percent of consumers won’t shop in stores that fail to offer touchless or contactless experiences, and Marraccini thinks that’s destined to become a permanent shift rather than a knee-jerk reaction to the pandemic.

“Curbside pickup is something that we've never done in the past because it was a novelty,” he said. Now I think it’s something that will stay, because it’s also a third option for merchants to make additional funds” in addition to in-store and online shopping.

Safe, Secure And Fast

While curbside pickup was borne out of health and safety concerns, even public libraries have taken it up as a matter of convenience these days.

“It’s amazing to think how fast people change, and how people feel about payments,” Marraccini said. He noted that the stats show 31 percent of consumers already say they prefer cashless transactions over those involving cash, and merchants who ignore this trend do so at their own peril.

“It’s faster, it’s easier [and] it makes more sense,” Marraccini said.

In fact, he said the only question merchants who haven’t updated their payment suites face now is: “How do I get there faster with a provider that can do it for me in no time?”

Other Disruptions

Marraccini called the recent rise in buy now, pay later (BNPL) installment plans “the biggest swing we’ll see in our industry. … It’s huge.”

He said friction-filled installment loan experiences from the olden days are still fresh in many people’s minds, which will help ensure that modern BNPL is here to stay.

Marraccini said that “if you think about the days when you would walk into a store, fill out the form, wait around for a half hour to get the answer back” versus now, when now you can “do it sitting at your desk in your pajamas on your phone,” the latter suits COVID-worried consumers’ present needs.

“I think it’s a huge thing, and I think it’s a huge win for the merchant as well, because they’re staying relevant,” he noted.

Don’t Be A Dinosaur

Marraccini believes that the more people see and use these new payment options — whether it’s on Amazon or PayPal or elsewhere — the more they’ll expect them when they walk into physical stores.

Adding to the probability that more merchants will embrace giving consumers more payment options is the undeniable fact that doing so converts more prospects into buyers.

Marraccini said retailers that offer installment payments can see “huge conversion, plus I’m still relevant to my consumers and not going to be a dinosaur.”

QR Codes, Mobile Wallets And Debit Cards

When it comes to QR codes, Marraccini said he is “still on the fence,” and thinks they would benefit from greater simplicity and a clear industry standard.

At the same time, although he’s a huge advocate for (and personal user of) mobile wallets, he believes their lack of market penetration is a problem. But he said it’s also a growth opportunity if more merchants embrace the Starbucks model.

And then there’s the ongoing battle between credit and debit. “As you look in the industry, you're seeing that cannibalization of credit by debit,” Marraccini said. As a result, he predicts that debit purchases will be the big winner this holiday shopping season.

And whether the pandemic goes away or people just become used to the new normal, Marraccini expects continued growth of payments optionality.

“I still believe these are options that we need to have and even further expand in the future,” he said.

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NEW PYMNTS STUDY: ACCELERATING THE REAL-TIME PAYMENTS DEMAND CURVE – NOVEMBER 2020

About: Accelerating The Real-Time Payments Demand Curve:What Banks Need To Know About What Consumers Want And Need, PYMNTS  examines consumers’ understanding of real-time payments and the methods they use for different types of payments. The report explores consumers’ interest in real-time payments and their willingness to switch to financial institutions that offer such capabilities.

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