More merchants lean on payment-link tech during the coronavirus pandemic

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Businesses affected by the pandemic are accepting online and touchless in-person payments from consumers with the help of technologies developed originally for B2B invoicing and payments.

Smaller retailers, restaurants, and sole traders who haven’t previously accepted card payments are using QR codes and links sent via email, social media messaging, and SMS to accept payments without the need for payment terminals, e-commerce storefronts, or a complicated development process.

Payment link tools from processors such as Adyen, Barclaycard, Cybersource, Global Payments, Judopay, SafeCharge and Worldpay enable customers to use their preferred payment method such as credit cards or digital wallets, with transactions occurring on a page hosted by the processor but branded with the merchant’s name.

Since customers only interact with the processor, merchants don’t handle payments and are out of scope for PCI compliance, while customers benefit from not touching potentially unhygienic card readers. Payment links work as well for in-person payments as for ordering over the phone or online. They can also be used for selling via social media platforms such as Instagram or Facebook.

The technology has the backing of both Mastercard and Visa.

“Mastercard has been working with fintechs and POS manufacturers to recommend best practices for payment links,” said Dave Glaser, Mastercard’s senior vice president, global acceptance products and innovation. “Several of the fintechs participating in Mastercard’s StartPath network are bringing payment link solutions to market.”

Glaser said Mastercard is seeing a massive expansion in restaurants, cafes and small shops incorporating payment link solutions, in effect turning a physical purchase into an e-commerce one.

Incu store
"We can use tools like WeChat, FaceTime or Zoom to guide people through our collections and then send a payment link via messaging, text, email or web chat," said Douglas Low, CEO of fashion chain Incu.

Visa has developed a payment link solution in the U.K. and Europe through a partnership with SafeCharge, a subsidiary of Canadian processor Nuvei. SafeCharge Local enables consumers to make payments online and over the phone through SafeCharge’s Paylink solution.

“Visa and SafeCharge have delivered the Paylink solution as an alternative payment option to small businesses across the region who’ve been affected by COVID-19,” said Dominic White, Visa’s head of merchant sales and acquiring for U.K. and Ireland.

The coronavirus pandemic brought about a change of attitude in smaller merchants, according to Brian McManus, vice president of product management at Cybersource, a unit of Visa.

“Objections to electronic payments went out of the window, and a lot of people who hadn’t seen a need for digital payments got introduced to them during the lockdown,” McManus said.

To reach these new users, CyberSource offers a payment link invoicing product that doesn’t need any complex integration, and is seeing a lot of emailed or texted payment links. “I think touchless payment solutions like ours could become permanent,” McManus said.

Pre-COVID-19, Worldpay offered its Pay by Link emailed e-invoicing product to professional services clients. Nicole Jass, Worldpay’s senior vice president for global SMB products, said that during the lockdown, the tool was repositioned as a text-to-pay solution for smaller merchants. It’s now used widely in North America and the U.K., for example for in-person dining or takeout.

While payment links are a low-risk, low-tech way for brick-and-mortar retailers to process transactions, they aren’t for larger retailers, especially in Europe, said Miya Knights, head of industry insight at U.K.-based Eagle Eye Solutions.

“These retailers are more likely to push in-app payment solutions for their own branded or white-label e-commerce and mobile apps in areas such as pre-ordering, scan-and-pay and loyalty,” she said.

Knights also said that payment link applications will be limited to customers already using social media in-app transactions such as WeChat Pay and AliPay, which are prevalent in Asian markets.

Upscale fashion chain Incu, which owns six Incu-branded stores across three Australian states, has been using Adyen’s Pay by Link technology to sell digitally during the lockdown. Although Incu is predominantly a brick-and-mortar retailer, it has been using the Chinese-language messaging service WeChat for social selling, operating its WeChat channel as an interactive mailing list.

The channel is used to share product updates, answer sizing and styling questions, and transact with Mandarin-speaking customers, said Incu’s CEO Douglas Low. Pre-COVID-19, purchases from the channel were finalized through in-store POS or via direct transfer. “When the lockdown started, we needed a secure way for customers to pay through WeChat,” said Low.

Incu’s payments partner Adyen implemented its Pay by Link technology for the channel in two weeks, according to Low.

“It only took one 15-minute Zoom call to teach our store staff how to use Pay by Link, and, as it’s really intuitive, uptake was instant, and customer response has been overwhelmingly positive,” Low said. “Customers feel secure, and can make a purchase from home using Pay by Link and arrange delivery, or walk by our stores to collect their items. We can use tools like WeChat, FaceTime or Zoom to guide people through our collections and then send a payment link via messaging, text, email or web chat.”

Payment options offered by Adyen’s Pay by Link include Alipay, WeChat Pay, credit cards, China UnionPay, Apple Pay and Google Pay.

“Using Pay by Link, we can sell across different states and through channels we couldn’t previously operate on such as social media and telephone sales,” said Low. “We saw about 300% growth online across the lockdown period. The pandemic encouraged us to focus more on delivering good digital experiences, and Pay by Link is something we intend to keep as a permanent fixture in our payment options.”

Incu’s enthusiasm for payment link technology is shared by other Australian merchants affected by the lockdown.

Commonwealth Bank of Australia is seeing growing demand from SMEs for three payment acceptance solutions: CommBank Simplify, a payment link e-invoicing product; the CommWeb e-commerce gateway; and the Bpoint bill payment solution.

“Many of our SME customers are transitioning online to adapt quickly and innovate during these challenging times,” said Sam Itzcovitz, Commonwealth Bank’s general manager commerce solutions. “Since March 2020, we’ve seen a 39% increase in e-commerce facilities being opened each week and a 63% increase year-on-year to June 2020 and we expect this trend to continue.”

U.K. payments processor Judopay is seeing a strong increase in the number of merchants wanting to deploy its PayByLink solution due to COVID-19.

“It’s proven popular among merchants wanting to improve their current payment process for sending invoices or for telephone orders at their call centers, and for those looking to offer contact-free payment solutions.” said Jeremy Nicholds, Judopay’s CEO. “For the taxi industry, which has been heavily reliant on cash for decades, PayByLink provides an easy way to offer digital and hygienic payments, without the need for any integration work.”

The re-opening of the U.K.’s hospitality industry on July 4 has led to interest in Judopay’s PayByLink QR code functionality for a contact-free experience by customers of restaurants, pubs and cafes. In this case, merchants create a unique QR code, which customers scan with their smartphone camera to open a checkout screen for payment in-person.

The Pharmacy Centre, which provides websites to 1,500 independent U.K. pharmacies, has created an e-commerce platform where it takes secure payments with the help of Judopay and Mastercard.

"Judopay’s PayByLink tool allows our member pharmacies to take safe and secure payments during the pandemic, reducing the need for customer visits," said Oliver Harris, a Pharmacy Centre director. "We plan to carry on using PayByLink following the pandemic, enabling pharmacies to provide services online and reach a wider audience."

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