eCommerce Merchants in the Land Down Under Turn to PSPs for Fraud Expertise

For merchants the world over, the bid to improve eCommerce checkout — boosting sales as a result — is a bit of a tightrope walk.

It’s critical to balance the desire to let more transactions through with the risks of doing so.

After all, fraudsters have proven to be increasingly clever in defrauding those same merchants, posing as legitimate customers.

Recently, PYMNTS Intelligence took the measure of what merchants want from their technologies and technology providers as they look for ways to make the online checkout experience more streamlined and secure. The 300 middle market merchants that we surveyed, in collaboration with Mastercard, for “The Role of PSPs in the Checkout Experience: Australia Edition,” hailed from five countries across the globe.

What Merchants Want

At a high level, middle-market eCommerce merchants have recognized that consumer facing interactions can be improved with the aid of technology offered by payment services providers (PSPs). They’re keenly interested, for example, in one-click options, which helps avoid the pain points consumers experience when they’re forced to input data manually to get an order completed.

In Australia, however, there’s a relatively lower percentage of merchants who find hiccups in their online checkout processes, given the fact that 2 in 10 merchants state that they are confronted with less than optimal checkout experiences.

What Drives Their PSP Choices

Merchants in Australia have indicated that they are turning to PSPs to bolster their fraud defenses (which also come with updates to the checkout experience itself). The majority of middle-market eCommerce players surveyed — at 63% — said they’ve asked these providers to update technologies to improve anti-fraud efforts. There’s widespread recognition that ease of integration of new technologies is paramount, as 54% of merchants choose providers based on the ease of the working relationship itself. Another 27% cite mitigating fraud as the most important reason for the basis of their provider choices. Limiting chargebacks was a key driver for 44% of merchants.

The most frequently requested features include one-click checkout (28% of respondents), card on file (20%) and secure card-on-file technologies (18%). Advanced capabilities like biometric authentication and tokenization are gaining traction, reflecting a growing interest in cutting-edge solutions.

About 49% want higher conversions and enhanced user experience during checkout. Additionally, 49% of merchants said the price of new technologies is a key factor when deciding which features to integrate.

Requesting Updates

Fully 82% of merchants in Australia told PYMNTS/Mastercard that they are able to request updates from their PSPs. But there’s room for improvement here for forward-thinking providers. The data show that just 18% of Australia’s merchants receive automatic updates from their PSPs, and thus many rely on requests for feature upgrades. Automating some of those updates, particularly with payments and checkout related offering can, we’d note, cement merchant loyalty to those providers. While 52% of merchants in Australia have asked their PSPs for new features and upgrades, 48% have not — which gives some greenfield opportunity for PSPs.

And educating merchants about security upgrades gives PSPs an additional avenue for success. PYMNTS Intelligence and Mastercard found that merchants in Australia also rank cybersecurity among the top benefits PSPs provide. In fact, 46% cite lower rates of fraud and 44% cite better data security measures. Another 38% say their PSPs help reduce false declines.