An estimated 18 per cent of web users shy away from online shopping due to security fears over payment. But a new offline payment method may well be what entices them to change their mind.
PayOffline, which is backed by Alliance & Leicester and offline payment network payzone, enables consumers to buy online but pay for their goods at one of 17,000 physical locations around the UK.
Soft launched in August last year, PayOffline is currently used by 300 small online retailers, and plans are now underway to scale the service up and get more businesses large and small signed up. And since offering customers as many ways as possible to pay makes good business sense, it may not be a hard sell.
PayOffline is a fully functioning payment processing system that integrates with existing shopping carts and e-commerce platforms in the same way as a traditional credit card system. The major difference is that goods don’t ship until the customer has paid over the counter at a payzone outlet, either with cash or a debit card.
With 18 per cent of adults not wishing to pay online and an estimated five million people in the UK without a bank account, PayOffline are convinced there is strong consumer demand for their service. Already eight of the main shopping cart providers have agreements in place with PayOffline.
According to the company, one of their largest retailers has seen five per cent of its turnover coming via PayOffline since offering the service from the end of October 2007. Depending on the volume of business, PayOffline charges between 1.25 and 3 per cent, a bit more than credit card processing as there is a cash handling charge.
In the next couple of weeks, the company is planning to publish a directory search engine of PayOffline merchants. And in the longer term there are plans being formulated to extend the service into mobile retailing. A pilot scheme is already being tested whereby a text message is sent to a mobile phone. The customer then accesses a payment barcode via a .mobi website and this is scanned at the payment outlet.
