Qual and quant study of 2500 UK consumers looking at attitudes to new payment technology. Uses behavioural economics to evaluate likely adoption of new payment ideas.

1. Optimising your OmniPayments:
Consumers, payments and the future
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2. CONTENTS
Introduction
3
Key headline findings
4
A payments explosion
5
A consumer-led perspective
6
Consumer payment behaviours
7
1. Reflex pay
7
2. Speed aware
8
3. Cash-amnesia
9
4. Transact-firmation
10
5. Loyalty at a price
11
6. Security outweighs hyper-convenience
12
7. Return rewards
13
8. Independence pay
14
9. Contactless in store
15
10. Smartphoned enough to pay?
16
Payments in the future
18
Rating new payment innovations
19
An OmniPayment future?
20
When will the OmniPayment future be here?
21
How imminent is the OmniPayment future then?
1. Fragmented payment future
21
2. Controlled payment future
22
3. How should retailers respond
worldpay.com
21
22
2

3. Introduction
In a world where new payment options and
technologies are appearing every day, it can be
all too easy for retailers to jump on the latest
technology bandwagon.
Whilst the business media is constantly reporting
on the next big thing in payment technology, the
tendency can be to assume that consumers are
adopting these new payment types at the same
pace. The reality is, as many businesses have
discovered, very different indeed.
The popularity of new technologies, especially with
smartphones and social media, is changing how
we seek and digest information, and undertake
even the most basic of everyday household tasks.
Yet despite love of the latest new ‘shiny things’
consumers remain slow to adopt new payment
technologies, and consider security and privacy to
be just as important as speed and convenience – in
many cases even more so.
Catering to the consumers of today means helping
them pay how they want to. Yet with the plethora
of options available in the market, it is vital for
businesses to find the optimum time to implement
new payment options. Developing a wider Omnichannel strategy can help retailers deliver on the
overall shopping experience that the consumers of
today and tomorrow expect e.g. loyalty, returns and
refunds.
worldpay.com
As the only payment services provider to offer
a truly one stop shop for those wanting to offer
the ability to accept payments in-store, online,
by telephone or mail order, by kiosk or mobile,
WorldPay is in the unique position to offer its
customers a flexible payments service, along with
a distinctive perspective on when to adopt new
payment solutions in various business models.
This report, the culmination of months of research
into consumer payment behaviours, has been
created to provide a helping hand to anyone looking
to take advantage of the new payment technology
options at the optimum time for their business.
In these challenging economic times it is vital for
businesses of all sizes to ensure their investment
in new technologies matches their consumers’
demands for these payment types – in order to
secure an appropriate return.
Over the next few pages, we provide you with the
views and advice on which payment types are
currently most popular with UK consumers, and an
insight into their payment habits, and opinions on
future payment trends. We hope you find it useful.
Ian Rutland
Head of Proposition and Marketing, WorldPay
3

4. Key headline findings
Chip and PIN is still
considered the most
secure payment
technology.
Payments are not a high interest topic
for consumers. Many do not think about
paying for goods and services: they
behave automatically and use cash and
card.
Consumers are speed aware and many think
new payment technologies do not provide
clear payment confirmation or a receipt.
Security is just as important as speed, 78%
keep a receipt for everything they buy.
The majority would
rather use
smartphones as a
weapon of the
high-street: for
‘show-rooming’,
checking prices or
downloading coupons
rather than to pay.
75% would like a loyalty
scheme linked to their
payment card.
worldpay.com
1 in 2 would like to use
biometric payments, such as
fingerprint, palm or iris
scanners, over other emerging
mobile technology options e.g.
PIN based smartphone, online
wallets, SMS, and social media.
60% recognise the contactless
symbol but only 10% have ever
used contactless (of those 93%
found it quick and efficient).
London leads in contactless
payments with 17% having
used the payment method,
compared to only 4% in Bristol
and 5% in Norwich.
33% of shoppers regularly use self
service kiosks, and 1 in 5 favour self
service kiosks because 'they don't
have to talk to people'.
4

5. A payments explosion
An explosion in payment options, functionality and complexity is underway:
Online – as shopping on the web grows, consumers are using payment cards, wallets and methods
like PayPal to pay.
Biometric – trials of Iris, fingerprint and other
biometric payments.
ONLINE PAYMENT
Mobile
Payments
Smart
Data
SMARTPHONE
VIRTUAL
CURRENCY
BIOMETRICS
QR
Codes
Contactless
CONTACTLESS
PAYMENTS
SELF-SERVICE
CHECKOUT
Pre-paid
Contactless Card
Contactless – rolled out in fast-food operators,
major retailers, convenience stores, pubs and on
public transport.
Smartphone – smartphone payments are already
possible using contactless technology and will
soon be widely available in the UK. Formats
include Quick Response (QR) code scanners or
person-to-person payments by app and mobile
number.
Mobile banking – smartphone banking apps
enable consumers to pay bills and others while on
the move.
Smart data-linked – organisations are linking
payments to streamline or improve their services
such as ordering a taxi, where location-based
information can help pick up customers safely and
quickly.
worldpay.com
Vouchers &
Coupons
Vouchers and coupons – by post, smartphone app, text, online search, at point of
sale and through aggregators (e.g.
Vouchercloud).
Pre-paid – whether by payment card, virtual
currency (e.g. Bitcoin), Ukash or PayPoint
machines.
Self-service checkout – Deployed extensively in supermarkets and newsagents.
All in all, the world of payments is becoming
increasingly fragmented, with multiple options,
and hence, complexity.
How will consumers react to these innovations?
What should retailers and businesses invest in,
and what should they ignore?
5

6. A consumer-led perspective
It’s time to ‘take the temperature’ of new payment
systems with consumers. Insiders in the payments
industry have said you can’t ask consumers about
which payment systems they will choose to use in
the future: their predictions are unreliable.
However, the WorldPay view is that:
1. We live in a consumer-driven world, where
the supply of most products and services
far outstrips demand and it is the public that
decides who and what succeeds. Collaboration
with consumers is key to developing new
services; Sir Terry Leahy summed it up when
talking about turning Tesco around in the
1990s:
‘In simple terms, we reversed the flow of the
company: instead of our work ending with the
customer, it started with the customer…. When
the customer spoke we listened.’
2. Consumers are using new ways of paying
– today, they have real experience. Years of
expensive trials using mocked-up payment
technology have been replaced by contactless
cards, smartphone apps and virtual money
such as Bitcoin.
worldpay.com
3. Consumers are tech-savvy – increasingly, the
public are sophisticated users of the technology
that underpins new payment systems:
•
80% of consumers are online
•
60% of online consumers have
smartphones
•
19% of online consumers use mobile
banking
•
8% use an Oyster card
•
biometric identification is growing
The consumer perspective can inform and support
the understanding of government, industry leaders
and experts, all of whom are trying to predict
payment futures.
WorldPay completed extensive research with
consumers to understand the future of payments. In
addition to in-depth qualitative research, an online
survey of 2,159 consumers was completed to
understand payment behaviours and needs.
Because payments are about behaviours rather
than attitudes, we linked the research to the fastemerging application of Behavioural Economics to
business.
6

7. Consumer payment behaviours
Glacial change
Apart from a handful of enthusiasts, no one
suggests that payments are a high interest topic for
consumers. Leading busy lives in tight economic
times, consumers spend perhaps only a few
seconds every day thinking about how they are
buying products and services.
This links strongly to Behavioural Economics theory.
Daniel Kahneman’s recent book, Thinking, Fast
and Slow, explains that people have automatic
behaviours which they don’t think about, that they
are emotionally wedded to, and that they don’t
change without effort. Payment routines fall into
this category: short-cut actions which help people
navigate their complex and busy lives.
However, our research uncovered clear trends
in consumer payment behaviours that have
implications for the likely success of new payment
systems. These are transparent tendencies that
have emerged from observing and interviewing
consumers, and can be further understood by
applying well-known behavioural and cognitive
biases.
Human behaviour develops at a much slower pace
than technology. It is less rational and only changes
when an individual is presented with options
which better meet their needs. With new payment
methods, this means there needs to be a desire for
adoption by consumers married to a willingness to
invest by retailers in making these new methods
available.
1. Reflex pay
Consumers have established payment routines,
which are difficult to change
Payments are made ‘automatically’ based on
repetition and past judgements about speed and
security.
“9 times out of 10 I use my debit card”
Female, 45-54, Northern England
Opportunity: Changing the public’s payment
behaviours will need strong benefits and compelling
marketing. The introduction of Chip and PIN by
dictate in 2006 is an example of the effort needed
to achieve mass consumer behavioural change.
However, it is not the role of Government to try and
force change through legislation, as more industry
standards may only stifle innovation. Payment
innovations need to develop in more local and
consumer-led ways to speed up adoption of new
payment technologies.
Only 7% vary the way they pay for groceries
3:4 Agree they tend to pay for things in the
same way
worldpay.com
7

8. Consumer payment behaviours
2. Speed aware
57% Say verifying online payments is slow
When prompted to think about their experience,
consumers want current payment systems to be
quicker
Consumers take for granted recent payment
improvements such as online checkouts or Chip
and PIN. When they are encouraged to think
about payments, they can identify opportunities
for change and identify impatience in their existing
behaviours:
“I notice the different amount of times it takes to
process [Chip and PIN]”
Male, 35-44, Southern England
57% Think there are too many steps to make
online payments by card
Consumers say the following have fast Chip and
PIN terminals:
Supermarkets
32%
Petrol stations
20%
Clothes stores
15%
Fast food
31% Often irritated by how long it takes to pay
in shops
Innovation is needed particularly in mobile
commerce where payment options are still slower
than Chip and PIN, and in high value near field
communications (NFC) transactions.
Demonstrating a behaviour known as recency bias
there is a tendency for consumers observing current
situations, not to acknowledge earlier changes and
improvements, which explains their desire for faster
payments.
Opportunity: Continual improvement is
necessary to impress and retain customers.
Speedier transactions would be welcomed if
payment confirmation and security was clear,
particularly for smartphone and mobile banking app
users.
There are more than 200,000 dial-up terminals still
in use in the UK. If retailers were to replace these
with broadband terminals they would see significant
improvements in the speed of transactions. Yet in
direct contradiction with home internet usage, both
inertia, a ‘hassle-factor’ and an irrational lack of
trust in broadband seems to prohibit retailers from
having done so.
11%
Train stations
8%
Local shops
8%
Cafes and restaurants
6%
worldpay.com
8

9. Consumer payment behaviours
3. Cash-amnesia
Many consumers are using cash less often,
partly because they forget, or don’t draw enough
of it out of an ATM
Despite the fact there are more than 65,000 ATMs
in use in the UK, consumers often don’t have
enough cash and instead are relying more heavily
on payment cards. The only category where cash is
the most popular is paying for a cleaner/gardener,
coffee and snacks, take-away food and top-up
groceries. And although 37% say cash helps them
budget better, the majority find replenishing cash
supplies to be cumbersome.
“I don’t often have that much cash…”
Male, 25-34, Wales
The fact that 38% say they often don’t have enough
cash when it’s the only way to pay, links to a wellknown behaviour: planning fallacy. People often
underestimate the time needed or number of tasks
involved in a particular activity, so running short of
cash is not surprising. Consumers no longer feel
paying by card for low value items is unacceptable
to retailers.
Opportunity: New payment systems can
remove the ‘getting cash out’ step to daily life,
making transacting simpler, avoiding losing a sale
and improving consumer convenience. Industry
stakeholders could take greater advantage of this
‘cash amnesia’ trend by exploiting the technical
CHIP capability found on most payment cards,
to include consumer data on store loyalty and
purchasing history. This kind of initiative would
not only make card payments more attractive for
consumers but spur the industry to innovate with
other new card-centric services.
“I have to remember to get cash-back”
Female, 25-34, London
27% Often forget to get cash from the ATM or
cash-back from check-outs
42% Using credit and debit card more than last
year for amounts of less than £10
worldpay.com
9

10. Consumer payment behaviours
4. Transact-firmation
Consumers want payment confirmation and try
to keep a record of the amount they spend
The public use receipts, displays and staff to check
payments. However, consumers say that some
new payment systems are too fast, provide unclear
confirmation or no receipt. Examples quoted during
qualitative research included having to keep track
of an Oyster Card balance and not receiving a
receipt when paying using contactless technology.
When paying by contactless, consumers also said
they were unsure when the payment ‘went through’
as confirmation was unclear.
“You can’t lose the receipt which you
may need”
Male, 45-54, Northern England
“You want to be sure its gone through before
you leave”
Female, 45-54, Northern England
In academic trials, it is true that consumers often
show a preference for things they are familiar with,
known as Mere-Exposure effect. This means they
can be ‘closed’ to new ways of operating; however
the research also shows consumers experience
problems with existing confirmation methods:
48% Say, “I always end up with too
many receipts”
29% Would like it if receipts were emailed to
them
Opportunities: Retailers’ payment systems
need to confirm transactions in ways which
consumers find reassuring, as any deficiency here
will raise questions of security in many consumers’
minds. A consumer should never need to ask for a
receipt, it should just arrive.
There are a multitude of options when it comes to
confirming transactions in ways consumers find
reassuring. New innovative payment methods such
as WorldPay Zinc, iZettle and Square all offer an
alternative method of providing a receipt, compared
to the traditional paper option.
78% Keep a receipt for everything they buy
worldpay.com
10

11. Consumer payment behaviours
5. Loyalty at a price
Consumers actively use loyalty schemes but
often forget their card or find schemes difficult
to manage
UK consumers are active users of loyalty schemes,
but these require a high degree of effort from the
public if they are used as designed:
92% Use a loyalty scheme at least
once a month
“My partner uses them but it’s a big lot of work
to do it”
Male, 25-34, Northern England
The high effort involved prevents loyalty schemes,
and now online vouchers, from achieving their full
potential. One consumer commented:
“Why the hell do I have to carry so many loyalty
cards?”
Female, 45-54, Northern England
“If I go to X, I’ve refused to give them my data”
Male, 45-54, Northern England
“I don’t use coupons because I can’t stand the
stream of emails…”
Male, 35-44, Southern England
Opportunity: Card-linked loyalty schemes
42% Say supermarkets, newsagents, etc. give
too many paper vouchers with receipts
1:3 Forget to bring their loyalty card when
purchasing
worldpay.com
and payments would improve usage and overall
customer experience. Ultimately, some of the public
would like a unified loyalty scheme across different
brands however at this stage both competition and
cost appears to be stifling innovation in the industry.
Synchronised loyalty schemes also necessitate
collaborative working between different retailers
and their partners, and until the benefits of doing
so are clear to all parties it is unlikely to precipitate
rapid change.
11

12. Consumer payment behaviours
6. Security outweighs
hyper-convenience
Consumers react cautiously towards very
convenient payment methods
Speed is valued by consumers, but so is security.
The public generally see a negative correlation
between the two. New payment methods, however
simple, need to reassure consumers that payment
security is high while providing some real benefit.
The high effort involved prevents loyalty schemes,
and now online vouchers, from achieving their full
potential. One consumer commented:
“Anyone could pick up my [contactless] card…”
Male, 45-54, Northern England
Psychologists might explain this behaviour in
terms of an illusory correleation; the tendancy
to inaccurately attribute a relationship between
two events. However, in the case of contactless
payments, some consumers perceive the speed of
the payment as a negative indicator: “It’s almost
too quick (contactless)”, Female, 25-34, Wales.
This is particularly the case if levels of security are
uncertain to consumers.
Opportunity: Security should always be
emphasised in new payment methods, particularly
when promoting convenience. 91% say online
payments are secure - a transformation arising from
the industry’s efforts to address initial consumer
uncertainty around payment security.
1 in 4 who don’t use contactless payments
believe such payments are insecure
68% Don’t like giving their debit card details
and 65% don’t like giving their credit card
details on the web
worldpay.com
12

13. Consumer payment behaviours
7. Return rewards
Consumers favour retailers and brands that
have seamless returns and refunds
Consumers are often frustrated by the different
ways that retailers handle payments, returns
and refunds. With time pressure, hundreds of
purchases each year and expectations of fluidity in
preferences, the public want to expend less effort:
40% Say it is difficult to return products to
stores even if bought from their website
63% Buy more from retailers with
no quibbles returns
39% Say it is inconvenient to have to get
refunds on the same card with which the
purchase was made
Consumer loyalty is heavily impacted by The Peak
End Rule, which says that people disproportionally
judge an experience by how it finishes. The
consumer shopping experience must be closely
aligned, whether it is in-store or online, as when
each brand has its own process for returns the
result can be confusing for consumers. Given the
high proportion of returns – up to 40% for some
fashion brands – making the process of refunds
seamless is important, and further, doesn’t mean
the sale is missed. Rather it can result in another
sale.
Opportunity: Most consumers will reward faster
refunds and easier returns; even though some
may take advantage, the majority will respect
and trust this approach. Although it might seem
unreasonable to many retailers, our research found
some consumers were frustrated by having to repack unwanted products to complete their return.
47% Say it takes too long for refunds to my
bank or credit card after I return something
worldpay.com
13

14. Consumer payment behaviours
8. Independence pay
Self-service is winning customers, changing the
role of frontline staff
Consumers are using self-service scanners more
and more and they are looking for different,
supporting behaviours from frontline staff:
“There’s never anyone there to help you just at
the right moment”
Male, 45-54, Northern England
72% Say sales assistants often tell me to
remove my card [from Chip and PIN terminals]
when I know to do it
Equally online customers increasingly look to
web-chat and phone service for support.
33% Would like to use self-service scanners in
supermarkets regularly
worldpay.com
The ‘backfire effect’ says that people react to
an inadequate experience as evidence that
strengthens their beliefs. If consumers are sceptical
of new payment experiences, and have a poor
experience, they are less likely to adopt the
new methods. With both self-service kiosks and
contactless payments, consumers complained that
staff were slow to help.
Opportunity: Introducing new ways of paying
and loyalty schemes need front-line staff to
overcome the ‘backfire effect’ through education,
empathy and support. Underestimating the
guidance consumers need to try new payments for
the first time will delay adoption.
Time and money will be crucial to overcoming this
backfire effect. That means primarily investment
in staff, which is a challenge in industries such as
retail with high staff turnover. Educating consumers
and staff is important here. There needs to be a
clear message about the benefits – speed, security
and convenience – and why a new payment
alternative is better than traditional ways of paying.
14

15. Consumer payment behaviours –
9. Contactless in store
Consumers are slowly taking up contactless
payments, but users experience benefits
Consumers are aware of contactless but only 10%
of the public have used it. The rate of adoption is
affected by a number of factors:
“The guy said it was the first time anybody’s
used it… [contactless]”
Female, 45-54, Northern England
63% Of non-users say they don’t have a
contactless card
Only 22% say contactless is insecure
Those that do, are very positive about the
experience and see more opportunities for
contactless payments:
88% Say it is quick and efficient
61% Say it feels secure
“X – why can’t all their machines be
contactless? You have to queue up, you have to
enter your pin number, and it takes a long time
to print….”
Male, 35-44, Northern England
60% Recognise the contactless symbol
10% Use contactless payments
worldpay.com
15

16. Consumer payment behaviours
10. Smartphoned enough to pay?
Smartphones and shopping go hand in hand; but
for browsing rather than paying
60% of online consumers have a smartphone and
often use it for the following:
‘Show-rooming’ (looking at products in-store,
buying online) (46%)
To check prices in store (45%)
Commenting about experience on
social media (32%)
Would like to use smartphones to make
contactless payments (8%)
worldpay.com
Pessimism bias is the tendency for some people to
overestimate negative things happening. This may
explain some of the negativity towards smartphone
payments, which appears to be extensive, and
where the following barriers are cited:
60% Are happy using existing payment cards
57% Would worry their phone might be stolen
45% Would be concerned about security
45% Would be concerned that they couldn’t
make payments if their battery was flat
44% Might need Wi-Fi or network coverage
16

17. Consumer payment behaviours
One in 5 online consumers use a mobile banking
app, the public is getting used to payments with
smartphones through secure accounts.
Opportunities: Smartphone payments offer
the opportunity to integrate loyalty schemes, and
remove wallets and purses, but removal of barriers
such as battery life, and integration with electronic
point of sale systems is needed to overcome
current negative attitudes.
Ubiquity is key when it comes to paying with a
smartphone – because people don’t like it if they
cannot pay by their preferred method. Wallet
systems are likely to take greater hold because
shopping cart abandonment on mobile remains
quite high – due in part to slow adoption of mobile
payment pages on websites, and other perceived
consumer barriers such as battery life and security
concerns.
To see rapid changes in mobile commerce, the
industry needs to better co-ordinate the ecosystem,
ensuring card issuers or other payment providers
and acquirers are moving in the same technology
innovation direction.
Smartphones on the High Street 2013
Used smartphone in store to check prices
31%
Comment about experience on social media
12%
19%
Downloaded vouchers and coupons in store
7%
19%
7%
16%
Used an App to manage tickets and loyalty cards
5%
14%
Used a QR code to get information
worldpay.com
14%
Shared your location with companies for offers
Sometimes
27%
Showrooming
Often
17%
5%
14%
17

18. Payments in the future
Search Youtube.com and videos marketing new
payment options abound, together with enthusiasm
from promoters and experts alike. Much on offer
uses smartphones and with nearly 60% of the
online population having one, the question remains:
which new payment systems will succeed?
2.
When consumers are made aware of new
payment options, they seem unconvinced of
the benefits of many innovations. Although
they recognised there could be improvements
in payments, many feel that existing methods
work well: the need for change is not perceived
to be great. This does not mean that innovation
will not occur, but it does suggest that suppliers
will need to drive change.
The research with consumers highlighted attitudes
that will influence the success of new payment
technologies:
1.
New payment systems have a very
low public profile
Consumers have very low awareness of new
payment options. Pingit, Google Wallet and
Hailo had some recognition, but Chirpify
payments were almost unknown. However,
consumers were not surprised that new
payment options were being developed;
their expectation is one of change driven by
technology, even if it’s not always regarded
positively.
Awareness does not lead to action
3.
Benefits need to outweigh security
concerns
Keeping money secure is an important priority
for consumers. Once a payment system is
trusted, it requires a significant incentive
to change behaviour. Currently consumers
perceive the most trusted payment mechanism
to be Chip and PIN, by a significant margin.
Most secure payment technologies
Most Secure
2nd Most Secure
Chip and PIN payment
51%
27%
Cash machine transactions
30%
30%
Web payments from a secure network
27%
27%
Payments using a self-service kiosk
10%
22%
Phone payments to UK call centres
7%
18%
Web payments from public Wi-Fi
7%
13%
Phone payments to call centres abroad
6%
4%
Payments using an App
5%
22%
worldpay.com
18

19. Rating new payment innovations
The quantitative research with 2,159 consumers
tested their interest in 10 payment innovations. By
far the most popular was the linking of payment
cards to loyalty cards. This was also popular in the
qualitative research, where consumers commented
on convenience factors:
The low levels of interest in new payment
innovations overall vary by group:
•
The potential of ‘big data’, in being able to tie
together payments and loyalty points, was the other
benefit and part of the second most popular option
whereby retailers kept records of expenditures
using payment cards and then offered vouchers.
“A bit frustrating when you get to the till you
have to give your card over. The X one is really
annoying – you have to put it in first to read the
chip.”
Male, 25-34, Wales
Contactless and mobile banking users
– Generally showed higher interest in new
payment innovations.
For example:
››
››
•
Of contactless users, 28% would like to
use biometric payments and 23% Hailo
Of mobile banking users, 13% would like
to use an online wallet where you can store
cards on a Smartphone app.
Younger consumers – Showed higher interest
in payment innovation. For example:
››
“The amount of times I have gone to a shop and
paid and gone damn! I should have given them
the voucher It would be great if it scanned your
clubcard and took the money off.”
Female, 25-34, London
•
Of 16-24 year olds, 17% would like to use
Pingit and 20% a smartphone to make
contactless payments.
Older consumers – Most were less interested
in payment innovations, except:
››
55-64 year olds would like to have a
payment card which combines with a
loyalty scheme.
Segment variation: early adopters of
new payments are most positive
I would like to use
Nice to have
Link payment card to loyalty scheme
34%
41%
Retailers kept record of expenditure using payment card to offer you vouchers
20%
43%
Fingerprint, Iris scanner
18%
31%
Using your smartphone to make payments but still with a PIN
9%
21%
Using your smartphone to make contactless payments to £20
8%
21%
Supermarket poster in railway station to scan for later deliveries/pick up
6%
21%
SMS payments (e.g.) Pingit
6%
17%
An online wallet where you can store cards a smartphone (e.g. Google Wallet)
5%
20%
Chirpify or direct social media payments
2%
10%
worldpay.com
19

20. An OmniPayment future?
Consumer enthusiasm for new payment systems
is restrained, although key segments show more
interest. The public can be unimpressed by
innovations that in the future are adopted widely;
the mobile phone being an often-quoted example.
Making new payments successful
for retailers
However, new payment systems currently on offer
are not as revolutionary as the mobile phone has
proven to be.
1. Offer real benefit and a strong proposition –
Developers and users of new payment systems
have to ask ‘how will this innovation benefit
consumers?’ ‘How does it address consumer
payment behaviours and needs?’ Collaborating
with consumers to develop new systems is
more likely to ensure success, as this method
takes into account consumer behaviours and
needs. As one consumer remarked:
The sheer volume of new ways to pay, the additions
to the payment process of vouchers, loyalty
schemes and self-service, means that consumers
will begin to be aware of innovation: contactless
payment by smartphone has arrived.
Already niche groups of consumers are using
online vouchers, contactless, smartphone apps
and mobile banking. The transition from the simple
dominance of cash, cheque and card is underway.
Segments of consumers will expect different
payments and we are set for an OmniPayment
future in which the public will expect to pay
however they choose. As one consumer remarked
of contactless cards:
What are the lessons for successful
implementation of new systems?
››
“Why would you change what you
currently do?”
Female, 25-34, Wales
2. Link the payment innovation to a business
process – apps offering more than just speed
or convenience seem to have the competitive
edge for consumers:
“I wish it was available in more places…”
Male, 35-44, London
worldpay.com
Payments linked to loyalty cards
››
“I do think the £20 limit is still too low
sometimes... probably £50 is better...because
shopping at X in the evening after work, if you
pick up one or two things and a bottle of wine
you’ve gone over the limit.”
Male, 25-34, London
››
Hailo where payment is linked to getting
a taxi
››
Payments linked to vouchers and
coupons
3. Underline security – Although financial services
providers generally reimburse consumers for
fraud, the public don’t treat this as a given
and are careful of how they spend money, use
passwords and PINs. Consumers realise they
won’t be compensated for inconvenience, if
they are a victim of fraud. Most consumers see
an inverse relationship between security and
convenience, so reassurance is vital.
20

21. When will the OmniPayment future
be here?
The consumer view on new payments is clear:
some interest, but no real enthusiasm. This
assessment is based on limited experience of
new payments (contactless, self-service, etc.)
and confidence with much of the technology
(smartphones and even biometrics).
1. Fragmented payment future
Here, different payment innovations fight it out for
success and good ideas and marketing win out.
Established players have the advantage, but upstarts are still possible.
The characteristics of this scenario include:
How imminent is the OmniPayment
future then?
››
New players enter the market frequently:
some do well while others fail, but overall
there is an expansion in payment options
Payment systems have traditionally been seen as
a substitute for cash. To operate successfully, they
need to be trusted by consumers and retailers,
widely available and accurate. In addition, the
OmniPayment future is one in which fragmentation
of the payment system is taking place to include:
››
Even if consumers are aware of new
payment systems, they may be perplexed
as to their purpose, and
››
Regulators struggle to keep up with the
pace of change.
››
A wider range of payment methods (e.g.
contactless, biometrics, Chip and PIN,
swipe)
››
Additional data collection and analysis
››
Vouchers, coupons and loyalty schemes.
There are many possible scenarios for the
OmniPayment future and no one can be sure of the
outcome. However, for the next five years, there are
two broad scenarios that emerge from the research:
worldpay.com
In this environment, retailers have to be alert
to emerging consumer preferences and adapt
payment options to meet that demand. This means
a greater range of payment options for consumers
and expenditure in technology, process and people
training. The fragmented payment future could
prove costly for retailers in terms of investment,
training and legal constraints.
What’s the advantage for businesses? More ways
to pay generally means more sales, as in most
business-to-consumer relationships the public
choice will eventually win out.
21

22. When will the OmniPayment future
be here?
2. Controlled payment future
3. How should retailers respond?
Here, sections of the payment industry, possibly
even government, and retailers work together to
introduce new payment systems. In this scenario
take-up is faster but the range of systems offered is
less widespread.
For retailers, critical mass in new payments
technology may take time. They need to be
cognisant of the needs to engage with consumers
across multiple channels for a positive shopping
and overall brand experience. It may be less
critical right now to be adopting many new ways
for consumers to pay. By watching and waiting,
and planning to gradually evolve payment
systems rather than radically adopt cutting edge
technologies, businesses avoid jumping on the
bandwagon and identifying the optimum time to
expand new payment services.
The characteristics of this scenario include:
››
While payment innovation will remain,
a fewer number of new systems will be
jointly promoted by the industry at levels
approaching how Chip and PIN was
introduced
››
Consumers will feel more confident in
using industry-backed payment systems,
however some may be concerned that
other options may be preferable; and
››
Regulators will be better able to control
payments.
What’s the advantage for businesses? Working
with payment providers offers more scope for
limiting the range of systems needing to be
invested in. Maintaining consumer reliance on a
more limited number of payment methods will help
to eliminate the need for multiple, costly, investment
and training by retailers with multiple partners.
worldpay.com
22

23. For more information please
contact your relationship
manager.
Worldpay.com
About the research
The research was carried out independently
on behalf of WorldPay by Davies Hickman
Partners between April and June 2013. It
included qualitative and quantitative research.
Consumers completed 9 x 1.5 hour depth
interviews in Cardiff, London and Manchester
exploring attitudes to payments and trialling
and testing new payment methods. This was
followed by a 30 question survey of 2,159
consumers completed online in May 2013
using nationally representative quotas for the
UK.
About WorldPay
WorldPay is a leading global provider of
payment and risk services, giving businesses
the ability to accept credit and debit card
payments face to face, by phone or online –
regardless of size.
WorldPay handles nearly half of all card
transactions in the UK, processing over 8.4
billion transactions every year. Unifying seven
leading retail payment solutions, it offers
services across the entire payment value
chain, including acquiring, gateway, alternative
payments, risk management, and mobile
payments. Their online payment gateways
cater for over 200 payment methods in 115
currencies.