Traditions and methods governing how and where people pay for goods and services have been upended by the dawn of a new digital era founded on connectivity and convenience. Retailers that fail to evolve, particularly in the widening frontier of e-commerce, are likely to fail. 

Contactless is now the leading form of in-store payment in the UK, with 80% of Mastercard in-person transactions now tap and go. A Mastercard survey of 18,000 consumers across Europe revealed three-quarters of adults (77%) have used a digital or app-based payment provider when shopping on the web in the last 12 months. Alongside this is rapid growth in e-commerce, with FIS’s Global Payments Report predicting it will make up nearly a quarter of global retail sales worldwide (22.6%) by 2027.

The tapping of contactless payments is now ingrained in society, particularly among Gen Z, the first generation to grow up in a fully developed digital ecosystem. As such they are more demanding of the services and providers they use when shopping. These digital natives have grown up with efficiency and speed embedded into their daily routines, from education to socialising and entertainment, meaning interconnected technologies are a necessity for merchants wanting to win their custom. This can be seen in their retail behaviour, with Mastercard research of UK consumers revealing more than half of 18-24-year-olds (53%) are motivated to use digital payment methods because it is quicker to check out.

Gen Z is also steering purchasing trends, especially via social media, and shaping the direction of travel for merchants to follow. Retailers offering technologies like Click to Pay – enabling consumers to shop online without needing their card to hand or having to type in payment details – can cater to these demands. Complications during the payment process are one of the frustrations for many shoppers, with 44% of Gen Z in Mastercard’s UK study believing that manually entering information such as card numbers and billing addresses is a hassle, and 48% wishing they did not have to do it at all.

As well as greater convenience and speed, this generation are also looking for more security when shopping, with a fifth of 18–24-year-olds (20%) experiencing fraudulent transactions on their card or personal banking accounts. Modern payment technologies offer robust security mechanisms that protect both merchants and consumers. Secure methods like tokenisation, the heart of Click to Pay, replace the card number with a token and bind it to a cryptogram, making it meaningless if stolen. This peace of mind also extends to retailers who do not have to worry about the storage of payment data.

Through implementing these secure systems, supported by established providers, businesses can build trust from their visitor’s first click. More than half of Gen Z (58%) say they are more likely to buy from a retailer partnered with a recognised payment provider, while 47% prefer all retailers to use the same universal payment system for ease and consistency.

By leveraging solutions like Click to Pay, businesses can adapt to the demands of today’s digitally driven shoppers and future-proof their operations while maintaining and building their customers’ trust. Mastercard is committed to empowering businesses with the tools they need to stay competitive, offering advanced innovations like Click to Pay that align merchants’ needs with those of tomorrow’s shoppers, while protecting both from fraud.

As Mastercard aims to remove manual card entry for every online payment by 2030, businesses that embrace tokenisation now will stay ahead of the game in a rapidly evolving digital landscape.

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