Instant payout trends: how are different industries being impacted?
Instant bank payments have transformed the payment landscape. By looking closer at the Trading, Travel and E-commerce trends in 2022 for instant payouts, what can we learn about the reasons behind their rise in popularity? And what can this tell us about the opportunities available for businesses in those industries where demand for real-time payments is high?
Recent consumer research from Brite Payments shows that the convenience and speed of instant payouts are particularly valued by consumers within the E-commerce, Trading and Travel industries. So, how can embracing instant payouts help operators in those industries build better customer experiences and increase loyalty?
Is your industry impacted by the popularity of instant payouts?
Continued digitalisation means instant business bank accounts are growing rapidly in popularity worldwide. The global transaction volume for all instant bank payments reached 70.4 billion in 2020 and is expected to grow at a CAGR of over 30% by 2024. Big numbers, but put simply in terms of potential customers, this means there will be 65m open banking users in Europe by 2024.
According to the whitepaper Instant Payments – Reshaping the Payments Ecosystem by Juniper Research, the transaction value of instant payments will exceed $27.7 trillion in 2026, a 470% rise from $4.8 trillion in 2021.
With the overall rise of instant bank payments, instant payouts – often in the form of seamless refunds – are also proving increasingly important to customers across all industries, having tripled in 2021.
But, according to consumer research carried out by Brite Payments, it’s within the industries of E-commerce, Trading, and Travel where instant payouts are deemed most important by the key generations: Gen X (born 1965–1976), Millennials (born 1977–1995), and Gen Z (born 1996–2015).
According to Brite’s consumer research, younger customers most valued instant payouts in the E-commerce industry, with 43% of Gen Z saying they’re important.
Some 52% of Millennials and a huge 60% of Gen X respondents said instant payouts were important to them within the Trading industry.
In the Travel industry, instant payouts were popular among all three generations, with 44% of both Millennials and Gen Xers showing their approval. But Gen Z showed the most love again with 55% valuing instant payouts.
Source: The Instant Economy: Delivering faster, simpler, and superior B2C payments across Sweden
What’s behind the growing trend for instant payouts?
Recent drastic changes to the global economy – including steeply rising interest rates and inflation – mean it’s more important than ever for businesses to manage their cash flow closely. Particularly those operating on already tight margins.
There’s also the continued rise of the gig economy, where payout is connected to performance. In the UK alone, the percentage of workers paid by platforms like Uber and Deliveroo jumped from 6% to 15% in just five years. And instant payments and payouts are also a huge part of marketplace selling, with clear benefits for both consumers and businesses operating in this area. It’s another growth industry, with around 60% of Amazon sales now made by third-party sellers.
And let’s not forget that COVID-19 has accelerated the already present trend towards instant payments with real-time payments increasing during the pandemic.
A big opportunity for your business
When it comes specifically to instant payouts to customers, these three generations – Gen X, Millennials and Gen Z – are today more impatient than ever. Waiting three to five working days for a refund is simply not going to guarantee a repeat customer any more.
Conversely, the near-instantaneous speeds available for today’s customer-facing operations, such as the rapid handling of refunds and disbursements, are a great way to build customer loyalty and a superior customer experience. They’re capable of making a real competitive difference in already saturated markets like e-commerce.
Likewise, immediate money transfers are now available 24/7/365 to refund travel purchases – which are usually on the more expensive side. Knowing this gives customers more security, a better overall experience, and the trust and confidence to part with their money in the first place.
Within the E-commerce, Trading, and Travel industries, the consumer research carried out by Brite Payments reveals that it’s Gen Z customers that show the highest consistent demand for instant payouts. But with demand also high among Gen X and Millennials consumers, particularly in certain industries, there’s no doubt that businesses operating in these industries should seriously consider implementing instant payouts. Not only to attract new customers but to keep their existing customers happy.
Brite Payments – the next generation of payment solutions
With Brite Instant Payouts you can pay your customers 365 days 24/7, using an automatic API setup based on Open Banking. The Brite platform is totally secure eliminates the risk for human error by removing the need for any user input. Plus, our fully transparent model builds trust with your customers by showing them exactly when their money will arrive. With quicker payouts, your customers will repurchase from you more often, which is great for business! We verify the account holder to ensure funds are always paid to the right person.
If your business needs to pay out money, fast… let’s talk.