Retailers Must Embrace Financial Services, and Quickly

Retailers know that customer engagement must be the focus of their marketing efforts. And it’s increasingly clear that brands that embrace financial services within the customer journey are scoring highly on engagement scores.

The only problem is, for many retailers, the idea of becoming involved in the financial transaction part of the journey is a leap too far. They consider this as their bank’s role, one they have happily delegated, seeing it as being too tricky to get involved in.

In the same manner, the new service providers, the payment platforms, get worked up over Banking-as-a-Service and Embedded Finance, the latest industry buzzwords, without fully explaining the simplicity and value of the proposition. What’s more, the number of payment providers on the market has dramatically multiplied over the years, creating a vast and often confusing ecosystem.

We’ve reached the situation where many retailers know they have to offer this as part of their own customer journey, but lack the confidence to take that final step.


Reputational Damage

What often takes them over the top and forces them to look at it anew is that they know the traditional customer journey, from their app to the bank’s app and back again, is fraught with complexity and poor customer experience. Many customers bail at this point. This means lost sales and irritated customers who blame the brand. Especially in times of recession, this is a compound waste of money, as they’re not getting return on their investment and are adding annoyed customers for their efforts. The marketing dollars spent getting the customer to the point of purchase is too easily lost, as is the brand’s position in the market.

Research has shown that if a brand gets the highly emotive financial transaction partly right, the results are profoundly positive. The ultimate trust part of the customer journey is paying for a product or service — do it properly and sales will increase.

This is why the digital wallet has come to the forefront over the last few years. Its simplicity works for the retailer and customer alike. It allows a brand, whether a small business or a megamall, to design a satisfying 360-degree experience for its shoppers. The key advantage is that it offers a wide range of automated capabilities such as digital card usage, points conversion, retail vouchers, loyalty programs and buy now, pay later features.

This wide-ranging functionality is crucial, because it’s not just about the payment of course — there is a wide range of ways the brand needs to empower its customer.

Loyalty Programs

Loyalty programs are a big attraction, especially if they are tiered and multi-faceted. This allows the brand and consumer to engage on a far higher level than previously possible.

The aim is to incentivize a brand’s customers to shop with them, not its competitors. If a customer can earn points for every transaction they make and get rewarded with individualized benefits, matched to their likes, then it’s a major plus.

Customers get to choose how to deal with their earned points in a variety of ways, including converting them into vouchers for use in a physical store, or cash back credited directly into their rewards wallets.


Buy now, pay later is a retailing phenomenon, one that by its very presence attracts customers to a brand. Allowing customers to pay for big-ticket items in installments via a buy now, pay later feature within the wallet, is a great way to be inclusive toward shoppers from diverse backgrounds!

This also establishes an ongoing engagement with the brand as they pay off monthly installments and creates the opportunity for further sales — potentially aided by a loyalty offering that encourages further purchases with points and discounts.

Contactless payment functionality is also a big draw, offering the customer ease of use and flexibility.

What we are talking about here is about heightened customer experiences — it’s no longer acceptable to fail at the stage when financial services are provided. Customers expert more, and those brands that do not deliver will fall behind. The key words for the retailer here are adaptability, scalability and optimized user experience.

Digital wallets are a pathway to an improved, convenient and frictionless payment process. And market figures show that they are increasingly popular. It’s reckoned that nearly 4.5 billion people will be using a digital wallet to shop in 2023, and that this will account for a whopping accounting for 52% of ecommerce payments globally. Furthermore, approximately 1.6 billion global consumers will pay with digital wallets at the point of sale (POS) next year, accounting for 30% of POS payments.

The digital wallet is the retailer’s portal to enhanced embedded experiences — one that need not be feared and can be fully grasped as a tool for the future of customer engagement.

The Future

Talk to the fintechs, and also look at what the banks are trying to achieve with their own solutions, and you will quickly discover a whole industry determined to make it better for the brand/customer journey. And the most exciting thing of all, we are just at the start of that journey — there is lots more to come yet.

John Rutledge is CEO of HolyWally. He is an experienced technology professional with a strong background in innovation, rapid prototyping and design. At American Family Insurance he was responsible for technology within the innovation (New Venture Build) team, including technical feasibility, due diligence, solution architecture, and technical prototyping and build. Rutledge worked with Startup Studio and Technology partners to build new ventures, and at Visa, he managed technology and design teams for the Visa Innovation Lab in Singapore.

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