Pay by Bank is here – why retailers need to act now

(Source: Bigstock)

As most Australian retailers would attest, receiving payments has become a costly business – to the tune of around $3 billion annually in fees and chargebacks. In the current economy, there is huge pressure on retailers to keep costs down across the board, at the same time as input costs are rising. This is not something all retailers can sustain.  

For a long time, the cost of payments has been accepted as part of the price of doing business. But it need not be that way. Payments is one area where retailers now have more power to control and reduce their operating costs. 

Since the arrival of Open Banking in Australia, consumers have had access to their financial information to share, but little has been done in the way of use cases for payments. This is because everyone involved in the payments system – from major card schemes, to banks, to Apple – all profit from existing payment systems, with merchants and consumers footing the bill. Thankfully, the tide is turning.

In Europe where Open Banking was pioneered, this has already changed, with disruptive technology companies entering the market and delivering what the ‘big guys’ won’t. According to a Statistica report, the growth of Open Banking is so rapid that Europe is expected to see nearly 64 million users in 2024. That’s an increase of over 400 per cent in just four years.

A new Waave coming

Australia is now following suit.

Waave is the first business to use Open Banking technology to launch both B2B and B2C payments in Australia. With its flagship product Pay by Bank, Waave aims to reinvent the world of payments. It’s a seamless and secure alternative payment method to traditional cards, allowing customers to pay instantly, directly, and securely via their bank.  For merchants, Waave is up to 80 per cent cheaper than card payments, while providing instant authorisation, faster funds settlement and no dishonour charges or chargebacks – all because it bypasses the middlemen. Think of it as the new direct debit for the 21st Century, using the latest technology to dramatically improve the payment experience for consumers, while significantly reducing costs for businesses.

Waave also connects seamlessly with all major e-commerce platforms including Big Commerce, WooCommerce, Adobe Commerce, SalesForce Commerce Cloud, and Commerce Tools. Waave is a simple ‘plug and play’, meaning that customer carts can integrate via Waave’s APIs and a Pay by Bank button can be easily added to a merchant’s checkout.

Why Pay by Bank is everything your customers never knew they needed

Before you become jaded about the thought of another payment method button at the checkout, consider the reasons why your customers will love Pay by Bank.

1.    It’s trustworthy and transparent: Pay by Bank cuts out the middlemen, meaning no typing in or divulging bank card details. What’s more, because it is connected to the government’s Consumer Data Right (CDR) which requires extensive regulatory oversight, it is the most secure payments framework. Consumers will have peace of mind that they are connecting directly to their bank and not handing over personal details to third parties.

2.     No credit pitfalls: In these uncertain times, consumers are more inclined than ever to use ‘real money’. In a recent national study, nearly all Australians (98 per cent) stood by cash as the most trusted payment method. A similar number (96 per cent) also trust debit cards; however, 13 per cent of Australians don’t trust credit cards ‘at all’, and close to one-third (30 per cent) lack trust in Buy Now Pay Later options. It’s in the best interest of retailers to meet consumers where they are, and in doing so build loyalty and trust.

3.    Convenience: In the same study, well over half (56 per cent) of Australians said they are open to using a new payment technology; however, almost half of Australians (42 per cent) find online payments cumbersome due to needing to enter card details every time and multi-factor authentication. Pay by Bank requires a one-off, 30-second sign-up. After that, it can be used with a single click. No more fishing around in wallets and tapping in card details every time they make a purchase. Pay by Bank is the fastest and most seamless consumer payments experience.

For now, consumers will use the payment methods on offer out of necessity, but there is a better way. The Open Banking wave is gaining momentum, so expect 2024 to be the year payments change. Now is the time for retailers to get ahead of the pack to delight their customers and improve their bottom lines.