The power of payment choice in a digital world

We live and work in a world defined by choice, technology and lightning-quick interactions – and nowhere is that more apparent than today’s payments industry. 

Providing a seamless payment experience is crucial for organisations aiming to meet the diverse needs of their customer base. People have come to expect frictionless payment journeys as standard, so there’s little room for error or failure to meet basic needs.  

This is where choice matters. Different customer demographics prefer different payment methods, and it’s down to the organisation to facilitate those preferences and make sure they are keeping pace with evolving technologies.  

Public sector organisations that offer a range of payment methods give themselves the best possible chance of accepting payments, building up cash flow, minimising arrears and debt. With that in mind, here are a few tips and trends to bear in mind when leveraging payment methods to reduce friction and cater to a wider range of customers. 

Which payment options should you be offering? 

Here are the main methods of payment that your organisation should be catering for: 

• Credit and Debit Cards – Widely used and familiar to most customer demographics. Ensuring the acceptance of major card networks such as Visa and MasterCard is essential.   
• Digital Wallets – Digital wallets such PayPal, Klarna, Apple Pay and Google Pay are the fastest growing method of payment in today’s market and offer a convenient way for customers to pay in just a few clicks through their laptop or mobile phone. Particularly popular among millennials and Gen Z customers.  
• Direct Debit – Allows customers to authorise automatic, regular payments from their bank accounts. Useful for recurring payments, bills or subscription services.  
• Bank Transfers – Making payments directly from a bank account is a secure option that security-minded customers often prefer.  
• Open Banking – Enables customers to make payments directly from their bank accounts through secure, authorised APIs. This method is gaining popularity due to its speed, security and low transaction costs. 
• Phone Transactions – Facilitating payments via phone can be another worthwhile channel, particularly when prospective customers get in touch to discuss a query and naturally have the option to make a purchase while on the same call. 
• Post Office or PayPoint – Not everyone prefers to transfer money online. Older generations may prefer to pay in cash via Post Office or PayPoint. 

How can you reduce friction? 

55% of online users say checkout friction is frustrating enough for them to quit a purchase mid-process, according to a recent study led by PYMNTS.  

By offering various payment options, public sector organisations can reduce the risk of payments arrears, and in fact by providing customers with their preferred payment option, enables a higher likelihood of successful payments. This promotes stronger financial inclusivity and a better overall experience for the customer. 

Keeping up with consumer expectations should be a consideration for councils and local authorities, as well as supporting their services and staff with the same systems used by private sector leaders handling consumer payments.  

Having an intuitive payment processing software that centralises data and makes it easy to manage payments from various channels is a huge benefit for internal teams. Without this, it’s far more difficult to facilitate different payment options, offer seamless purchasing journeys or track channel success. 
 
Top organisations now also make sure to offer a seamless mobile payment experience, so that customers have no trouble purchasing through a mobile app, QR code or SMS. Mobile payments are becoming increasingly popular so it’s a good idea to confirm that your choice of payment software provides this. 

Delivering a data-driven experience  

Digging into your payment data should reveal insights into customer behaviour, spending habits and preferences. Ideally, your organisation should have an easy way to visualise or report on that information, and use any insights gained to inform strategic decisions.  

Your choice of payment system has a big role to play here. It’s worth researching your options to find a solution that offers detailed data and user-friendly reporting, so you can collate and share insights within just a few clicks.  

This makes it easier to spot recurring trends, seasonal fluctuations and variances in profitability across different payment channels or areas within the organisation. Data trends will also help to clarify the preferences of different demographics, so you can adapt accordingly to meet the needs of your main target audience.