Potentially driven by the increased adoption of online shopping techniques, consumers are investing more in credit cards and debit cards than ever.
Discover Card sales rose by 2.8 percent during the last quarter of 2013, according to a recent report from PYMNTS.com. Sales volume for the company reached $29.5 billion during the same timeframe, up significantly from the $28.7 billion in sales recorded during the same timeframe in 2012. Net income for Discover reached more than $600 million during the quarter, according to an earnings report.
“The fourth quarter concluded a strong year for Discover, with record net income for 2013,” said David Nelms, chairman and CEO of Discover. “Last year, we grew our card receivables faster than the industry and further established ourselves as a leading direct bank and payments company through expanded product offerings and new payments partnerships.”
Changes are coming soon to the payment processing industry
Despite such success, many are coming to expect that consumers will soon begin to prefer other modes of making electronic payments. WorldPay, for example, recently projected that digital wallets will make up 25 percent of the entire payment card market by the year 2017. This illustrates the need for retailers and organizations in other industries to optimize their credit card payment terminals as much as possible in the coming months and years.
“We’re seeing a transformation in transaction trends,” said Shane Happach, chief commercial officer for WorldPay. “Credit and debit cards have long dominated as the payment method of choice for online transactions. Now, alternative payment methods are forecast to grow significantly faster than total e-commerce and will represent more shopper spend than cards by 2017.”
The firm reported, for example, that 44 percent of all transactions in China are made using e-wallets. The company also expects that cash will only make up 2 percent of transactions by the year 2017, further illustrating the need for strong payment terminal technology. Kevin Dallas, chief product and marketing officer of e-commerce at WorldPay, went on to note that expanding the capabilities of credit card payment processing machines will need to be a top priority for merchants in the coming months.
“Merchants will need to ensure they understand diverging regional and sector trends in preferred methods of payment,” said Dallas. “It’s crucial that online merchants work with a payment provider with specialist knowledge of the complicated alternative payment landscape.”Back To Blog