P2P and Mobile Wallets and Online Shopping:

Nobody can pull off an excuse, “Oh, I ran out of cash”, in case they don’t have much to contribute to a party. Ever since P2P transactions have emerged in e-commerce marketing, things have changed 360°. P2P or Peer-to-Peer payments are described as transactions between two parties through their bank accounts or credit cards via an online application. It has become a trend among the population, specifically amid the pandemic. Online shopping has increased significantly worldwide in the mid of 2020 due to the virus outbreak. Plus, with in-store restrictions, people are drawn towards touchless payments and purchases. In today’s time, we see that online payments are becoming a mainstream solution and have impacted businesses widely.

With the rise in e-shopping, consumers have shifted their attention towards P2P applications and mobile wallets, including Google Pay, PayPal, Apple Pay, and a variety of other tools to process payments. These P2P apps are often linked with the user’s bank account or debit cards to enjoy a smooth transaction.

Why are P2P applications getting attention during the pandemic?

The use of mobile payments and wallets are at the peak with the increase in online purchases. They are relatively simple, quick, and easy to use, which is why they are popular these days. Plus, a customer can have multiple accounts at the same time, including Google Pay, Apple Pay, or PayPal accounts, which is highly convenient. Shopify designs and creates most of the business pages and websites, and it displays a range of payment options at the time of checkout, including Shop Pay, PayPal, Apple Pay, and Google Pay. Since there is no restriction in using a single payment option, it attracts the users and enhances their shopping experience. Business who offers a variety of options for the user’s ease wins the race!

Additionally, customers don’t have to carry cash when they can store their valuables safely in digital wallets. It is convenient for them to purchase both in-store and online. They don’t have to keep their bank debit or credit cards neither they have to punch digits into the system. The purchases have gone completely touchless, which has only sped up the usage of the P2P app.

How is online shopping evolving in 2021?

Previously, customers used to shop visiting the stores, which was the traditional shopping method. But due to the surge in online purchases, we have seen that people make purchases whenever they want and wherever they are. There are thousands of e-commerce websites that offer one-click purchases on the go. With the high compatibility rates of websites with electronic devices, people tend to shop more. Around half of the population reported in a survey that they had purchased goods online at least once during the pandemic.

Even in-store purchases during the pandemic were made through touchless payment methods, which accelerated the P2P apps usage and mobile payments. In 2020 approximately 90% of card payments, including in-store and online purchases, were made via touchless payment methods.

What do the numbers say?

Looking at the current statistics, around 1.48 billion customers have used mobile payments during the current pandemic in 2020, says Global Payments in 2021. Furthermore, we expect the numbers to rise by 33.4% in the next three years. In 2019, the debit card payments increased by 6.5%, and it mainly constituted touchless payments or card not present transactions. There is a significant uptick in the usage of debit cards as it is playing a major role in uplifting the e-commerce industry by facilitating both card present and card not present payments.

In 2019, about 75% of the debit card transactions were based on card-present payments because of the in-store purchases. At the same time, the usage of debit cards for online transactions continues to grow steadily at the rate of 2.3% each year. However, the rate increased speedily as soon as the Covid-19 global pandemic occurred. Now, about three in four debit card transactions are done via mobile payments or P2P apps.

What are the bank trends in 2021?

According to cornerstone’s recent work, some technologies are running popular for banks in 2021. Firstly, we have an online account application. Digital account opening is one of the factors that has promoted the extensive usage of debit cards. It is easier for users to sign up for bank accounts, thus promoting P2P apps and mobile payments. Around 44% of the banks and credit unions are introducing online account opening systems by 2021.

Moreover, P2P payments are trending among the masses in 2021. Today about 25% of banks and one-fifth of the credit unions are moving towards adopting P2P applications and tools in 2021. It is estimated that about 65% of mobile users have downloaded PayPal into their devices. Research says that about 40% of these PayPal account users make a purchase via PayPal almost every week.

Apple Pay, Google Pay, and other P2P apps such as Venmo and Zelle are less popular than PayPal, but about one third of its users reported weekly usage of these apps. This is a great number itself, and it has expected to increase in the next few years.

Conclusion:

P2P payments and Mobile Wallets are a recent trend in the e-commerce industry that is growing with the increase in the rate of online purchases. In the current pandemic, P2P apps are helping to minimize the spread of the virus. These platforms are widely used and appreciated by customers worldwide since they are safe, quick, and simple. It is estimated that about half of the population worldwide will shift towards mobile payments in 2025. Even after the pandemic resolves, the customers would still use digital wallets since it is far much better than carrying physical cash or cards. The benefits are likely to increase, which is why we can expect the numbers to increase in the future. If businesses want to expand their revenues, adopting P2P or mobile payment methods seems to be the right decision.