The humble days of physical cash exchanging hands between merchant and customer are distant memories. Now the way that the world pays and receives payment has entered the digital age and the emphasis has been placed on the merchant to accommodate the preferred payment method of the end consumer. In our ever-globalising world, merchants are not only keeping up with domestic trends rather, having to view the whole world as a potential market. This view may look both optimistic and overwhelming respectfully but through proper planning and knowledge of the shifting industry, merchants can become both excellent suppliers of goods, services and preferred payment methods.
The rise of cards
Both banks and consumers have come to understand the importance of convenience whilst travelling abroad. As a result, the use of credit and debit cards has risen as people domestic habits have paved the way for their payment behaviour abroad. Whilst charges still occur on card payments, consumers appear to be accepting these for the convenience and security of cards. Pre-paid travel cards are also a more popular method of payment, these work like debit cards just without the debit charges aligned to them. Knowing this, merchants should be prepared that foreign consumers will be reaching for their cards as opposed to their cash more and more as the convenience of paying increases.
Influence of mobile
In addition to the use of cards abroad, mobile and contactless payments have arguably become one of the biggest trends in financial payments over the past decade. In major cities all over the world, consumers are often disappointed when a merchant is unable to provide a contactless method of payment. The same can be said for those travelling abroad, using mobile or contactless payments in a foreign country has been adopted by many replicating the ease at which they can at home. Merchants should therefore ensure that contactless is an essential part to how they take payments from both travellers.
Understand where customers are coming from
Merchants will already know their customer base well and often will have to interact with travellers and holiday makers at certain times of the year. Knowing where their customers come from during these seasons can help a merchant to increase their sales. By pricing in the local currency of their customers as well as the domestic, merchants can give a greater sense of security and familiarity to their customers. For instance, if a merchant receives high levels of EU business, it may be useful to price in euros as well as pounds.
Offering a choice
Often, the uncertainty of having convert foreign transactions into into their home currency can be a stressful and inaccurate process for holidaymakers. Not least with the recent fluctuations in the Pound, meaning that understanding value for money and sticking to a budget is more challenging. Merchants can help bring greater transparency to cardholders by giving them a choice to pay in the local currency or in their home currency, via dynamic currency conversion. In opting to pay in their home currency, the calculation of the value of the purchase is done for the customer, so they don't have to. It means they can lock in the exchange rate at that moment, determine value for money and have confidence in the total amount that will be coming out of their bank account. In offering this choice, the merchant is able to provide a better experience to the customer, who can select the payment method that best suits their needs.