Fintech Ecommerce Revolution: The Ultimate Trends

by James · July 27, 2022

Today, a number of interesting trends have emerged in fintech and e-commerce. Without fintech, many aspects of e-commerce that we take for granted would not exist. In this article, we’ll take a look at the biggest trends coming out of fintech and affecting e-commerce.

Table of Contents

Buy now Pay later

If you shop online, chances are you’ve seen options from brands like Afterpay, Affirm or Klarna to pay for your favorite brands using instalments. Even Amazon has offered this service for a number of years. The phrase “buy now, pay later” is becoming almost ubiquitous. Giving credit to a customer to buy something is nothing new, but e-commerce has reinvented this idea by making it easy and accessible to anyone shopping online.

Unlike traditional personal loans, which can trigger a drop in your credit score, “buy now, pay later” only provides a soft inquiry, meaning there is no reduction in your credit score.

Some proponents of buy now pay later claim that it helps promote financial inclusion for people who do not have access to traditional credit products. In addition, it can also give buyers increased control and flexibility over consumption.

However, criticism of buy now pay later has become more vocal.

Recent controversies have emerged, including in Australia, where regulators are moving in to regulate these services like other traditional credit offerings. “Let’s start working on regulation [them] within the credit space. We are pleased that they have introduced a code, [and will] move to legislate it and fill any gaps,” said Stephen Jones, the Chancellor of the Exchequer.

Financial newbies in Gen-Z have been hooked on these services in the US as well. Amelia Schmarzo, a San Diego college junior, recently told NPR’s Planet Money about falling into a buy-now, pay-later trap where she racked up $2,000 in credit card debt and drained her bank account.

Many of these controversies come after Apple announced its own buy-now-pay-later service. Despite the controversies, buy now pay later is unlikely to go away and the Fintech companies offering these new credit options will continue to grow as their share of the economy continues to grow.

Explosion of payment options

Mobile payments

Related to “buy now, pay later” is the expansion of mobile payment systems. Mobile payments have gone from entering your credit card into an online form and hitting send, and have expanded to allow the use of smartphones and other mobile devices.

Single-click checkout has also expanded as a result of the expansion of mobile payments. One click to checkout means customers can simply click one button and checkout is complete. Companies like Paypal with One Touch, and Shopify’s Shop Pay, have helped solve many common problems with the one-click payment e-commerce platform.

Customers often give up on checking out when it requires an account, there are complicated forms, or there are hidden costs. One-click checkout eliminates these issues and helps prevent cart abandonment – leading to higher sales.

Chat trading

One-click checkout isn’t the only revolution in e-commerce payment options.

Instead of relying on invoicing or checkout, chat commerce has enabled real-time payments as customers use chatbots for various services. Often, chatbots can help customers quickly resolve issues without having to contact support directly. In addition to this convenience, chatbots can also remember customer preferences and personalize the experience.

This all boils down to AI-powered services that can remember what size jeans you wear and what styles you prefer. AI-powered chatbot services enable richer engagement and connections, all while empowering mass customization and customization.

SMS payments

Payment processing is undergoing a revolution, with more and more payment options being provided all the time. SMS payments have also recently taken off. SMS payments allow customers to make payments via SMS text messages.

Today, fintech eCommerce innovations are about capturing any lost sales. SMS payments mean eliminating burdens for customers making purchases, thereby reducing cart abandonment and page breaks. SMS payments are also fast, safe and convenient.

Data-driven marketing and sales

In terms of data-driven innovations, the fintech sector has seen great strides; whether it’s using software to monitor employee work or finding ways to leverage data analytics to understand customer buying behavior, companies today are using big data to get the most out of their data.

Some of the most important applications of data-driven innovations have been to develop personas for customers. In this way, businesses can help personalize the shopping experience and improve the overall customer experience.

Using data, teams can optimize their pricing and deliver dynamic price adjustments in real time. Data-driven insights also allow retailers to better deliver advertising to consumers.

Ultimately, data-driven innovations will only expand, and companies that are able to leverage them for e-commerce will see great growth as access increases.

Democratization of access to sales

Ongoing development in fintech and eCommerce is the democratization of sales platforms. Today, small businesses have a variety of options to sell their goods thanks to eGiants like Shopify and Amazon.

One area that is lacking is adequate platforms and financial solutions for small to medium-sized international merchants.

One of the fastest growing areas of e-commerce is the expansion of social shopping. Instagram is leading the way in this space, with influencers and brands connecting with each other to help sell products. Instagram allows you to seamlessly tag products and brands in posts and then shop directly on the platform, all without leaving the app.

This type of social shopping has allowed smaller brands and creators to take off. Essentially, social shopping allows creators to generate content about their brands and also sell their products. Big brands are taking advantage, with everyone from Nike to Gucci taking to social media to sell and promote their products.

Other trends

A few recent trends are worth mentioning. QR codes, cryptocurrencies and blockchain are increasing in use and spreading from being novelties to being standard parts of the e-commerce landscape.

One trend is the constant cyber security threat. As more and more systems move online, they become vulnerable to hackers and other bad actors. This means that for every new payment processing system that emerges, another attack vector emerges. In response, fintech companies will simply have to continue to develop greater security features.

Conclusion

There are a number of interesting e-commerce trends that exist today, thanks to fintech. As the industry develops, more innovative products and services will appear in the coming years. Above all, fintech has reduced the friction between customers and the till and allowed brands to better sell their products and deliver them to more people.