Ahold Delhaize USA and Fiserv have partnered to launch pay-by-bank as a digital payment option for online grocery orders. If you’re unfamiliar with pay-by-bank, it’s all the buzz in the payment space as an emerging method to pay directly from a bank account, bypassing the traditional card networks.
The key selling point for consumers is convenience, as it eliminates the need to manually enter store card details. Some merchants—typically fuel merchants—are also incentivizing its use through loyalty programs.
Payment Options Galore
Last year, Fiserv partnered with major retailer Walmart to bring the technology to millions of customers, drawing renewed attention to it as a test bed for broader retail adoption.
So why launch a new payment method like pay-by-bank right now? Data from the Javelin Strategy & Research Buyer PaymentsInsights series shows that the grocery vertical has been a particular dominant area for debit cards.
However, credit cards—which pack higher merchant fees—have become increasingly popular among consumers. Pay-by-bank encourages more volume to run through lower cost instant and ACH rails which saves a significant amount of money for the merchant and presents customers with further choices in how they prefer to pay.
Ahold Delhaize USA reports that “tens of thousands of customers have enrolled” since launching pay-by-bank late last year. The technology is available for use at The GIANT Company, Giant Food and Stop & Shop.