Wall ID

Success rate and profit margin of Shopify stores Several information sources suggest that the Shopify Success Rate of eCommerce stores is around 5% to 10%. This means that out of every 100 businesses that use Shopify, only about 5 to 10 businesses of them are successful.  (https://lnkd.in/dXquSShv, https://lnkd.in/dF3MgWTH) This inversely implies that 90-95% of stores fail. However, it's important to note that these are estimates and not official statistics from Shopify itself. What are the margins brackets of the Shopify stores from the available data: 1. The average net profit margin for Shopify stores is estimated to be around 10%. 2. 5% net profit margin is generally considered on the low end for Shopify stores. 3. The typical profit margin ranges for Shopify stores are: - Low-end profit margin: 5% - Average profit margin: 10% - High-end profit margin: 20% 4. For small eCommerce stores, the average gross margin is 30%, while for larger businesses it's 37%. 5. The optimal Gross profit margin for a Shopify eCommerce store is typically around 40%, though this can vary based on factors like business type, products sold, and competition. Given this information, we can conclude that some Shopify stores do operate with net margins around 5% or lower, as this is considered the low end of the profit margin spectrum. #openbanking #identitymanagement #fraud #checkout

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How integration of open banking with e-commerce platforms can provide seamless experience that offers several advantages over traditional payment methods? Here are some ways in which open banking integration can offer better options: 1. Direct Bank-to-Bank Transfers: With open banking, customers can make direct bank-to-bank transfers without the need for intermediaries like PayPal. This can result in faster transactions and lower fees for both merchants and customers. 2. Real-Time Payment Confirmation: Open banking allows for real-time payment confirmation, which means that merchants can receive immediate notification of successful payments, leading to faster order processing and fulfillment. 3. Enhanced Security: Open banking utilizes strong authentication protocols and secure data sharing mechanisms, making transactions more secure compared to traditional payment methods. Customers can authorize payments directly from their bank accounts, reducing the risk of fraud. 4. Lower Transaction Costs: By bypassing traditional payment gateways and intermediaries, open banking can reduce transaction costs for merchants, leading to potential cost savings that can be passed on to customers in the form of lower prices or discounts. 5. Seamless Checkout Experience: Integration of open banking with e-commerce platforms can streamline the checkout process by eliminating the need for customers to enter payment details manually. Customers can simply select their bank account for payment, authenticate the transaction, and complete the purchase quickly and easily. 6. Personalized Offers and Recommendations: Open banking allows for the sharing of customer data between banks and e-commerce platforms, enabling merchants to offer personalized product recommendations, discounts, and promotions based on a customer's financial behavior and preferences. 7. Integration with Budgeting and Financial Management Tools: Open banking integration with e-commerce platforms can provide customers with access to budgeting and financial management tools that help them track their spending, set savings goals, and make informed purchasing decisions. Overall, the integration of open banking with e-commerce platforms offers a more seamless, secure, and personalized payment experience compared to traditional methods, enhancing customer satisfaction and driving greater efficiency for merchants. #openbanking #identitymanagement #bankID

McKinsey: The prospects for open banking payments in the US. Merchants welcome these payments because the transactions are low-cost, irrevocable, and more secure than other payment methods. Use of A2A can significantly reduce fraud and charge-backs, as well as eliminate interchange fees. These benefits accrue because every transaction is authenticated by a consumer’s online banking credentials and uses real-time rails. Merchants can elect to pass the savings on to consumers or improve margins by retaining them. Consumer-to-business payments remain a key target for A2A. We estimate that US A2A payments—consumer purchases made remotely at the POS and excluding any type of bill payments such as utilities and mortgages—could surpass $200 billion in volume by 2027, representing a compounded annual growth rate of 19 percent and a roughly 5 percent share of US digital commerce spend. Automated clearing house (ACH)–based A2A has traction in certain government and utilities use cases, where cards are often surcharged or not accepted. In the United States, A2A payments have been slow to catch on. One reason is that, in the absence of a regulatory framework, banks have been at a competitive disadvantage in staking out a strong presence in the payments marketplace. Also, Americans love their credit cards and the rewards that come with them, so dislodging the popularity of cards is perhaps the biggest challenge to US adoption of A2A. Although card companies have a dominant US market position, A2A could offer banks a more competitive and standardized way of making payments while giving consumers and merchants more options. For banks and other institutions, the data provided by open banking could help generate a wide range of financial services, including enhanced insights and analytics. Consumers could benefit from potentially lower costs and improved customer journeys. With these benefits in mind, our analysis of payments in North America estimates that A2A could handle about $200 billion in consumer-to-business transactions by 2026 and potentially much more in other types of payments. The impact may be limited for daily transactions with a retailer or service provider but larger for big-ticket and recurring payments such as utility bills, insurance payments, and more.

Fastest growing payment methods in E-commerce Consistent with prior years of MRC study, merchants continue to accept four to five different payment methods on average from their customers. Card and digital wallet payments are the top two acceptance methods, each used by roughly three quarters of eCommerce merchants worldwide. Most merchants accept debit transfers and mobile payments as well. While those top acceptance methods are widely used by merchants in all regions, some methods are used much more in certain markets than others: for instance, cash on delivery is accepted by more than one-third of merchants in APAC, versus less than 25% of merchants in other regions. And gift cards and vouchers are far more popular among North American merchants than those operating elsewhere. As consumer expectations and preferences regarding digital payments evolve, so too, must merchant acceptance offerings. Among the fastest-growing new payment methods are digital wallets (currently accepted by 72%), mobile payments (52%), realtime payments (42%) and buy now, pay later (32%). The survey shows that a large share of merchants now accepting these types of payments added them within the past year. Adding new methods is especially important for merchants looking to improve the customer experience and/or reach new customers. In fact, these are the top two motivations merchants cite in the survey for adopting new acceptance offerings. Overall, merchants overwhelmingly agree that the rise of realtime payments represents a positive development for the financial ecosystem, since real-time payments can complement credit card payments. 83% of merchants agree with this sort of statement and only 4% disagree. #openbanking #paybybank #identitymanagement #verifiablecredentials 

How open banking and pay-by-bank payments disrupt payment layer cake Open banking and pay-by-bank payments are disrupting the traditional payment layer cake by introducing new ways for consumers to make payments and access financial services. 1. Direct Bank-to-Bank Payments: With open banking, consumers can authorize third-party providers to access their bank account information and initiate payments directly from their bank account without the need for traditional card networks or payment processors. This bypasses the card schemes and acquirers typically involved in card payments, disrupting the traditional flow of funds in the payment ecosystem. 2. Increased Competition and Innovation: Open banking encourages competition by allowing new players to enter the payment space and offer innovative payment solutions. This can lead to a more diverse range of payment options for consumers and businesses, challenging the dominance of traditional payment methods. 3. Enhanced Security and Control: Pay-by-bank payments leverage strong customer authentication methods and real-time bank account verification, enhancing security and reducing fraud risks compared to traditional card payments. Consumers have more control over their financial data and can choose to share only the necessary information with authorized third parties. 4. Lower Costs and Faster Settlements: By cutting out intermediaries and streamlining the payment process, open banking and pay-by-bank payments can reduce transaction costs for merchants and enable faster settlements. This can benefit businesses by improving cash flow and reducing operational expenses associated with traditional payment methods. 5. Easier Customer Experience: Pay-by-bank payments simplify the checkout process for consumers by eliminating the need to enter card details or navigate through multiple screens. With direct bank-to-bank payments, customers can complete transactions quickly and seamlessly, leading to a more convenient and user-friendly payment experience. 6. Efficient ID Verification with Bank Account Profile: Leveraging bank account profiles for identification purposes can streamline the onboarding process for new customers. By using verified bank account information, businesses can authenticate users more efficiently and securely, reducing the need for manual identity verification processes. This not only enhances security but also improves the overall customer experience by making account setup and verification faster and more reliable. Overall, open banking and pay-by-bank payments are reshaping the payment landscape by offering more efficient, secure, and innovative alternatives to traditional payment methods. As these technologies continue to evolve, they have the potential to further disrupt the traditional payment layer cake and drive greater digital transformation in the financial services industry.

Today we released our 2023 Security Annual Report, highlighting our commitment to being an industry leader in #cybersecurity, leaning into collaboration, communication and transparency. Our program exceeded every major industry benchmark for the 4th consecutive year. In this Q&A, Jamil Farshchi explains how we’re delivering on our commitment. https://bit.ly/3vbmIy1

Baby boomers come to buy, while millennials come to browse. Millennials abandon seven times more carts than baby boomers and seniors. Providing a frictionless payment experience certainly helps increase the likelihood that online shoppers will complete their purchases. In addition, merchants need to be aware of generational differences in cart abandonment rates. For instance, millennials lead in cart abandonment, abandoning an average of five carts in the past 30 days, followed by Gen Z consumers at four. In contrast, baby boomers and seniors averaged fewer than one cart abandonment in the past 30 days, suggesting they go online specifically looking to complete a purchase. On the other hand, younger consumers’ behavior might be linked to the ease of browsing and the abundance of available choices. They may hold items in their charts while searching for better deals. Online shopping platforms can significantly influence consumer decisions and foster greater loyalty by streamlining the checkout process and providing the payment options consumers want to use. The highest rate of cart abandonment is in the clothing and accessories category, where both millennials and Gen Z consumers abandoned an average of two carts in the last 30 days — five times more than baby boomers and seniors. In contrast, cart abandonment is less common when shopping for essentials such as groceries and big-ticket items such as electronics or home furnishings and appliances. We found, at most, one cart abandonment among these categories across all generations. Streamlining the payment experience — thus reducing shoppers’ drive to look elsewhere — could be a key strategy for reducing cart abandonment and building loyalty among younger consumers. https://lnkd.in/ebUP6Ubv

🚀 Seamless Transactions, Secure Identity: Wall ID's Cutting-Edge Toolkit Unveiled

Industries with High Authorization Decline Rates Some industries are experiencing high rates of authorization declines, impacting businesses negatively. Here are the sectors facing challenges: - Recurring Payments: Approximately 15% of credit card payments are being declined, with some industries seeing rates exceeding 30%. - Online Businesses: Challenges include incorrect card information and fraudulent activities. - Subscription Services: About 15% of subscription payments are being declined, affecting businesses in this sector. - E-commerce: Decline rates are as high as 17% in the e-commerce industry. - Luxury Goods: Businesses selling luxury items may experience more declines due to the nature of their products. It is essential for businesses to identify the reasons behind these failed transactions, such as insufficient funds, outdated card details, or suspicious activity. Collaborating with reliable payment partners can help improve approval rates and reduce declines, leading to increased customer satisfaction and revenue. If your business operates in recurring payments, online services, subscriptions, e-commerce, or luxury goods, it is crucial to address authorization decline issues. By addressing these challenges and partnering with reputable payment providers, businesses can enhance transaction approval rates and drive financial success. #openbanking #identitymanagement #verifiablecredentials #paybybank