With the world rushing to their phones, tablets, and PCs to buy what they need and want at a time when most physical stores are closed, the payment networks are maneuvering to smooth out online transactions. This includes chucking clunky checkouts and opening the way for transactions to go ahead when card credentials change.
Visa Inc., for example, said Wednesday it has added 28 gateways, acquirers, and payment-service providers to its tokenization service, and 27 more to its one-click online buy button. The company has added more than 10,000 U.S. merchants so far to click-to-pay, as the service is called, since January. The service also claims 37 million active Visa users. “We’re seeing a lot of momentum on the Visa click-to-pay side,” says Alan Johnson, vice president of digital solutions for the network.
It’s no mystery where that momentum is coming from. ACI Worldwide Inc. reported this week its volume of online retail transactions grew 24% over the four months from January through June compared to the same time in 2019, and were up 209% in April alone, as consumers were confined to their homes and apartments in reaction to the Covid-19 pandemic. “Aside from the necessity for digital commerce in times when retail stores aren’t available, consumers are finding that digital commerce is easy and convenient,” says Thad Peterson, a senior analyst at Aite Group, a Boston-based consultancy.
Nor is this turn to e-commerce likely to fade as restrictions are lifted. “It’s pretty clear that the dramatic increase in digital commerce and payment driven by the pandemic will remain for the foreseeable future,” Peterson adds.
Click-to-pay is Visa’s new name for a common buy button Visa, Mastercard Inc., American Express Co., and Discover Network settled on last year. It’s built on a standard called Secure Remote Commerce that comes from EMVCo, a standards body controlled by the big networks. The idea behind the buy button is to simplify purchases online by mimicking the experience in-store of a single payment terminal that can accept cards from a variety of brands. The buy button not only simplifies transactions, it also lets the big networks compete more nimbly with players like PayPal Holdings Inc. and Amazon.com Inc., Peterson argues.
Among the twenty-plus processors now supporting click-to-pay, Visa said, are major names like Adyen NV, BlueSnap, and Moneris Solutions Corp. CyberSource, which Visa owns, is also supporting the service.
Visa figures that among the hordes of online shoppers are many who could become habitual users if given a quick and easy experience. “A lot of consumers may be shopping for the first time, and click-to-pay is easier,” Johnson says. He adds Visa has found that without SRC in place a consumer must negotiate an average of 23 fields to complete a purchase. “I’ve tried to sign up for curbside delivery and dropped out because it’s so difficult,” he says.
Visa’s other move this week also plays a role in the effort to appeal to online consumers. The network has supported tokenization—which replaces actual card credentials with data that’s meaningless if stolen—since 2014 with Visa Token Service, but the technology can also ease cases where credentials have been updated or a card has been replaced. This comes in handy in so-called card-on-file instances, where merchants can refer to credentials buyers have used in the past.
“Merchants can update credentials through API calls,” Johnson says, referring to application programming interfaces that ease the transfer of data. “They can receive updates as they are made available from issuers.”
Peterson says with the rise of e-commerce volumes lately, convenience for the user is as important as the security of the card details. “With the growth of digital commerce, the need for security and convenience at the shopping cart is extremely important for merchants,” he says. “Providing VTS for card-not-present transactions provides an additional layer of security for the merchant without adding friction to the transaction so sales aren’t impacted.”
Among the 28 new payment providers supporting Visa Token Service are buy-button supporters BlueSnap and Moneris.