This article indicates that FIS’s Worldpay crypto acceptance solution has already helped merchants accept “billions of dollars of crypto purchases.” It also reports that Worldpay will be rolling out a service to enable crypto exchanges to accept cards for cash-in as stablecoins, and is working on accepting a digital wallet. So will consumers shift to crypto as the primary new way to hold value and spend?
There will be two major factors associated with that change in behavior: How many merchants accept the payment type (which is partially driven by transaction cost and the effort and cost to deploy a new payment type), and which currency and payment type the consumer prefers.
Mercator deploys multiple surveys every year to evaluate consumer payment behavior and business acceptance methods. It will be interesting to see if small businesses turn to crypto acceptance and how consumer behavior evolves relative to buying, holding, and selling/spending crypto. Relatively few consumers hold crypto and even fewer spend crypto today. But as the market evolves, and if crypto becomes more stable, that could change, and more consumers might decide to use crypto. Regardless of the market size of crypto holders, the key question for payments is: Which payment type will the consumer prefer?
Will they prefer using crypto directly, using bar codes or QR Codes or mobile wallets, or will they prefer a card/token-based solution that delivers the benefits many have become familiar with, including zero liability, dispute capabilities, and in some cases significant rewards? Mercator will keep asking those questions:
“Buying crypto is just the beginning. Worldpay is planning to leverage those relationships to move beyond allowing consumers to buy crypto with credit or debit cards, its primary crypto business at present.
• With a big bet on stablecoins, Worldpay is hoping to mainstream crypto payments with two new products it’s readying for release.
• First, it plans to let crypto-native businesses such as crypto exchanges accept fiat payments via Visa or Mastercard and convert the proceeds to stablecoins, said Nabil Manji, head of Crypto and Emerging Business at Worldpay. This product, especially useful for companies that use stablecoins as their reserve currency and prefer not to touch fiat, is expected to launch by the end of June.
• The second product, “pay by crypto,” would let any Worldpay merchant accept stablecoins and other cryptocurrencies as payment directly from consumers, online or in person. The merchant would have the option to immediately convert the payment to fiat if it wants. The product is still being developed, but could be available later this year or early next year.
• Instead of paying with a card, consumers could use a crypto wallet — which is a notable move coming from a payment processor that built its business on cards.
Could this unlock shopping with crypto? The pay-by-crypto product would potentially provide consumers with many more merchants where they could spend their crypto, since Worldpay has more than 1 million merchants worldwide.”
Overview by Tim Sloane, VP, Payments Innovation at Mercator Advisory Group