COMMENTARY: Here’s How the Big Card Networks Can Make Their Common Buy Button a Winner

The digital payments innovators used to be Mastercard and Visa, but with the rise of PayPal, it’s been a new game. Then along came Alipay and Apple Pay and many other local or specialized payment methods, making the playing field even more competitive for these card payment platforms.

Visa Checkout and Masterpass were supposed to be the solution for safe, convenient payments. But they had trouble making it stick because of somewhat complex implementation and the fact that neither pull nor push marketing were utilized to their full potential. Digital sellers put the customer first and need smooth transactions to avoid losing sales, so these solutions did not take off as desired. Users were also worried and confused about payment-method selection.

Now the playing field may be leveling again, at least at the global level. Visa, Mastercard, American Express, and Discover have announced that they will combine their payment options into a single button, agreeing with the new EMVCo framework. This could be the opportunity for unified payment methods.

Four key elements will dictate success:

1. The Shiny New Button/new one-click option. EMV is the language payment leaders speak. Its protocols are familiar and demonstrate an expertise in security standards. One singular digital ID could also help with e-commerce fraud, which is up 30% in the last year. This new collaboration could provide a better defense against fraud, and a unified “button” for all companies involved could present a stronger unified front. Also, the novelty factor has a strong effect on customers.
2. Better CX. Part of the problem with Visa Checkout and Masterpass was the poor promotion and uncertain customer experience. Both were kind of complicated and not well communicated. If the big card leaders can address these issues, offer a seamless experience, and use their huge networks to communicate the benefits clearly and effectively, the common buy button could be a winner. In addition, end-user support needs to be a priority. Traditionally, card companies are good with bank/financial institution communication, but merchants can’t be ignored. The user experience, especially when it comes to finalizing orders and checkout, needs to take precedence. A one-click experience is definitely a step in the right direction.
3. Localization. While a good user experience is key, merchants also want solutions that are relevant within their market. So local brands that have a tremendous influence, such as Alipay or WeChat Pay in China, can’t be left in the wind. The Shiny New Button will face some fierce competition from these rivals and will have to figure out if it should partner with them or compete.
4. Added Value: Security & Risk Mitigation. Card networks are known for their leadership in security (PCI DSS, MATCH, etc.). Offering tokenized digital payments, similar perhaps to how Apple Pay works now, would make the button nearly unhackable, providing users with a digital ID to replace cardholder information. EMVCo also has advanced biometric options (fingerprint, palm, voice/facial/iris), something that will solve authentication challenges.

This initiative is, in theory, a step in the right direction. But the payment players need to prioritize the end-user experience and not repeat mistakes from the past. This Shiny New Button will tarnish quickly if elements such as enhanced security for fraud prevention and easy implementation and integration are not seen to be benefits. Merchants will still want to display multiple payment options to cater to buyers, so local competitors such as Alipay or WebMoney [from Russia] won’t disappear any time soon.

If the added value of this new button isn’t there, it will simply fade away. However, given the strength of the card networks behind it, we may see a new clear winner in the future.

—Adriana Iordan is a vice president of product management at 2Checkout.com Inc., Atlanta.