The expansion of the mobile portfolio foreshadows consolidation


The pace of the recovery has been inconsistent around the world, with widespread immunizations opening the doors to life outdoors in places like the United States, while the slow distribution and rapid spread of the Delta variant maintains the others in detention. This inequality has had a big impact on verticals like international travel, and as Citcon CEO Chuck Huang told Karen Webster, it is expected to last for much of the rest of 2021.

But while things remain slow in some segments, others, like retail, are accelerating quickly. The merchant side is changing aggressively, Huang said, especially when adopting new payment methods. This is a reality in the United States, where Citcon’s activity is concentrated, but also throughout the world. Over the past 18 months, e-commerce merchants have significantly globalized their market outlook and sought to change their payment offerings for a much wider range of consumers.

The pandemic forced the expansion of e-commerce on merchants, who realized that expanding to an international audience was perhaps their best bet if they wanted to push their products and services. And these merchants, Huang said, are getting bigger and bigger when it comes to how far they want to expand.

“For example, just a few months ago, I spoke to e-commerce companies that aimed to collect payments in 40 different countries. Now their roadmap is to collect payments from 68 countries to keep growing, ”he said.

This expansion, he noted, will accelerate the use of online QR code payments as a safer and smoother tokenized option that merchants want and need to adopt. Merchants will focus on the mobile wallets they want and need in an environment where it can seem like a new one is opening every hour, showcasing both online and offline point of sale (POS) options. smart enough to present the short list of options to consumers. want to use.

Upcoming online QR extension

As merchants look to expand to more than 60 countries, Huang told Webster, this is directly pushing QR adoption – because to transact in a new country, they have to support local wallets, because card penetration is low in many markets. They use QR codes when shopping online and in stores.

And while QR codes as an in-store method are increasingly familiar in the United States, Huang explained, shoppers typically don’t see QR payments offered as a method when shopping online. This is because when a website recognizes that a customer is logged in from the United States, they are “smart” enough to know they are probably not looking for a QR-based method. On the other hand, when the same site sees a buyer using a VPN or connecting from Asia, they may well offer a QR option. But just because American consumers don’t see them today doesn’t mean they’ll never see it, Huang noted, because QR is starting to really gain a foothold in the market.

“In the US you first get an experience of this type of wallet in the in-store environment, but once you go to a website, if you’ve used it in-store before, they’ll show QR for you, ”Huang explained. “Then you can scan it and it actually comes quite naturally.”

Natural for consumers and beneficial for merchants, who no longer jeopardize their conversion by forcing consumers to identify themselves or enter a card number to pay. Those extra steps and extra layers of friction can cause consumers to rush to exits, leaving their carts abandoned.

This is why QR Online is taking off – and widely, Huang said. Citcon is already discussing with the “expected” players – Amazon and other mainstream e-commerce companies – how they can bring QR codes and the many alternative payment methods associated with them, directly to their platforms, a- he noted. But Citcon also sees interest in less obvious places.

“In Las Vegas, MGM, who runs Caesars Palace, is aggressively working to enable QR because the nature of its business exposes it to international consumers,” Huang said.

A growing variety of mobile options

The increased expansion of the mobile wallet landscape, he said, will mean more than just an increase in the adoption of QR code methods. It also means that different types of mobile wallets will become important including buy now, pay later (BNPL) or crypto wallets.

Coinbase has tens of millions of users who would like to pay with their crypto holdings, but only about 10% use the card product they attached to the wallet to make those payments possible, Huang noted.

Citcon has no problem integrating this card product and can also help merchants and consumers by providing alternative rails for the merchant with a direct integration experience, Huang added.

And this explosion of mobile alternatives will create more diverse consumer behavior – just as consumers now have around five card payment methods, the mobile future is likely to see similar diversity in methods.

This means that gateways will need to ensure that they offer traders the maximum range of options. To meet the needs of consumers on a mobile basis, merchants will need to be smart and selective in what they offer on the checkout page, ensuring that it is in line with consumers’ needs. This can include general mobile wallet options like PayPal or Alipay, access to the crypto wallet, and a BNPL offer or two up for grabs.

It’s not the same as the clutter one would see if they tried to offer the 500 possible mobile wallet entries on their checkout page, but it can start to get cluttered, especially with the proliferation. the number of payment methods per region. Traders, Huang said, will need to be selective in their offering and smart in delivering the right options to the right customer.

“It’s not going to be a single ‘winner who takes it all’ on the buyer’s side,” he said. “There are buy now, pay later wallets. There are crypto wallets. And if you add them up, you’re still talking about accepting a minimum of five to ten mobile wallet offers. It is important to make sure that these are the right ones for the audience and the market you are trying to reach.



About the study: UK consumers see local purchases as essential for both supporting the economy and preserving the environment, but many local High Street businesses are struggling to get them in. In the new Making Loyalty Work For Small Businesses study, PYMNTS surveys 1,115 UK consumers to find out how offering personalized loyalty programs can help engage new High Street shoppers.

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