Now that 2016 is underway, the Vantiv eCommerce team is hard at work helping our customers prepare for the new technologies and the trends coming this year. Last year saw huge changes in the payments industry, with the EMV migration being the biggest transformation the industry has seen in a long time. We know as 2016 continues, more merchants will migrate to EMV, ushering in additional payment methods including mobile and online form-factors. In particular, we’ll continue to see the eCommerce ecosystem evolve.
Here are the three biggest trends we are watching in 2016.
- SMBs will be at the greatest risk for fraud
Currently, 71 percent of cyber-attacks are targeted toward small businesses, according to a Trustwave report, and this is expected to grow as EMV takes a firmer hold. If the adoption of EMV in other geographies around the world can tell us anything about the migration to chip cards, we can expect a large rise in card-not-present (CNP) fraud in 2016, especially down market. To combat the risk of CNP fraud, SMBs will need to focus on shoring up cybersecurity methods, including ensuring that all customer data is encrypted and thus more secure throughout the transaction process.
- More merchants will offer goods in a subscription format
In 2016, we’ll see a rise in the number of traditional merchants offering online, subscription-based goods and services, such as those from Birchbox and Blue Apron that provide weekly or monthly deliveries to consumers. These subscription-based goods and services allow merchants to create predictable revenue streams, while providing easy connections with customers.
- Customers will prefer security over simplicity
Last year, more than 178 million consumer records were lost or stolen, according to a credit.com report, which will drive consumers to be more conscious about where they share their personal information. Because of this, we feel consumers will be more willing to accept some extra steps during the checkout process in return for higher security, and grow to expect online retailers to employ measures to keep their personal information safe. With that in mind, we will also begin to see eCommerce merchants who do not meet these expectations begin to lose business.
As you can see from these trends, security will play a large role in processing eCommerce payments throughout the year, and will be more important for the industry as we become further ingrained in the EMV migration. Merchants will need to build security tactics into their payments acceptance strategies to plan for cyber-attacks, keeping in mind the value consumers place on security. This will be especially important as subscription services become more prevalent and merchants need to store customers’ payment details, rather than processing one-time transactions.
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