Fintech retail is an emerging trend in the financial sector. It is a term that is used to describe technology-driven companies, that use innovative digitally-based strategies to offer customers more personalized, convenient, and cost-effective services.
Yes, it’s a new buzzword in the retail industry, but there is a lot more to it.
So what exactly does “Fintech” mean?
Fintech is a term that covers a wide range of financial technologies, like e-commerce, digital banking, lending and more.
For example, getting guaranteed payday loans no matter what in Canada, through a streamlined process online, falls under Fintech.
However, it’s not just limited to the classic financial space.
Fintech and Retail
The retail industry has also seen some changes because of Fintech.
For example, more than 40% of retailers are using some form of electronic payment methods, like Apple Pay, Google Wallet, Amazon Pay, PayPal. That said, security still remains a concern.
Online payment security is a major concern for many people.
It’s not hard to understand why . . .
After all, we are all used to the idea of paying with cash, so the idea of paying with anything else seems strange.
It gets more tricky when most of these methods require your personal information. Such as name, address, date of birth and more.
Which means they pose a potential risk for identity theft, and possibly more.
That said, these same Fintech financial powerhouses have billions of retail customers today.
Although security remains an issue, it hasn’t really stopped people from not using them. The convenience factor is just too high. Plus security is only getting more tight every single day which is increasing consumer confidence.
Especially in the retail industry.
Let’s have a look at some of the leaders in the Fintech space that are causing a major dent in the retail industry today.
Apple Pay is an easy and convenient way to buy products without the need to carry any cash. It is a mobile payment service that uses near-field communication (NFC) to wirelessly transfer information between the user’s device and the retailer’s point of sale system.
This service by Apple is accepted at over one million locations worldwide, and can be used to purchase goods from many major retailers, such as Walgreens, Whole Foods Market, Nike Inc., Staples Inc., and McDonald’s.
In addition to NFC-based contactless payments, some stores will also accept Apple Pay transactions via traditional point of sale terminals using an iPhone 6 or newer model running iOS 11.
At the moment, according to Apple pay stats, well over 1 million locations worldwide (Including high end retailers) are using this technology. It is also accepted by major retailers like Walgreens and more.
Google Wallet is a mobile payment service that allows users to store their credit card and debit card information on their phone.
It was first released in September 2012 with an Android app called “Google Wallet”, which allowed people to pay for items with credit cards, debit cards or gift cards from participating retailers by tapping their phone on contactless point-of-sale terminals. The service was only available in the United States.
Google Wallet’s pay service has been available for a few years now and it has reached over 10 million transactions per day on average. This is an increase of about 2 million transactions per day since last year.
To say that retailers don’t use Fintech is an understatement. In fact, the retail industry is the second biggest adopters of this technology, and the growth just keeps on happening.
We’re talking exponential growth year by year.
Especially (Surprisingly), in developing countries.
Amazon Pay is a payment processing service that allows Amazon customers to use the credit or debit cards associated with their account, along with other payment methods, to make payments for goods and services on Amazon.com or certain affiliated websites.
Amazon Pay is a secure way to make payments on the internet using your credit card information stored in your Amazon account.
In order to use Amazon Pay, you’ll need to have an account with Amazon and a supported credit card.
It’s important that you keep your password and login information for your Amazon account private, and secure, so that nobody else can access your information.
PayPal’s retail business is the largest retail ecommerce platform in the world, processing over $5 billion in payments every day. PayPal enables people to make purchases without sharing their financial information.
Paypal might be considered an old dog in the online retail industry, however, it is still the most used platform. Especially for high end clothing and accessories retailers.
While some retailers are still hesitant to embrace this new technology due to security concerns, others have found benefits in how fintech can help them with customer satisfaction, and loyalty.
By offering rewards programs, and personalized services for each individual customer, retailers are selling like never before.
Retail payments are the lifeblood of the global economy, and Fintech companies are increasingly investing in this area. In addition, Fintech firms such as Square and Stripe have been providing payment services for years, but now they’re venturing into retail payments as well.
They want to make it easier, and more convenient for customers to pay for goods and services.
These companies believe that their customer-centric approach will help them disrupt traditional retail money and banking models.
Overall, 2022 looks really exciting for the Fintech and retail industry.
The future of is bright.
The integration of AI in the retail industry is only going to increase in the future, with more and more retailers making use of it. Which is hardly implemented at the moment. Although Amazon warehouses seem to be testing it (This is being kept under wraps at the moment).
Retailers are turning to AI-powered chatbots to provide personalized customer service, automate routine tasks, and predict customer needs. This is beneficial for both customers and retailers because it saves time for both parties while also providing a better experience for customers.