The Time for Progress is Now

How Crypto Can Enable E-Commerce and Merchant Payments

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One of the many lasting impacts of the pandemic has been the resounding shift to e-commerce. From basic household items to luxury goods, making purchases online during lockdown has now become the new norm for consumers around the world. This shift also had an effect on the adoption of noncash retail payments in emerging markets which grew by 25% CAGR between 2018 and 2021.

It’s estimated that 22% of all sales take place online, and Morgan Stanley predicts the total e-commerce market could grow from $3.3 trillion to $5.4 trillion by 2026. In markets with well-developed payments infrastructure like South Korea and the United States, online sales could grow to 45% and 31% of total sales, respectively, within the next five years. 

For businesses looking to capitalize on this opportunity, crypto can help e-commerce companies expand into new markets, attract new customers and streamline global transactions to boost profitability. 

Improve Experience and Reach

While online shopping options may seem ubiquitous and sophisticated, the reality is that the e-commerce industry has a lot of room for maturation. 

From basic payment operations and infrastructure to the end-user experience, businesses have an opportunity to realize significant improvements in efficiency and customer engagement. Crypto can address both of these facets.

At the highest level, accepting crypto as a form of payment can attract new customer segments and help differentiate a brand. It can signal a commitment to innovation or – as recently initiated by Tag Heuer, Gucci and others – a luxury brand catering to a widening base of crypto-interested consumers. Research shows that some 60% of crypto owners would prefer to use digital currencies for online purchases, which makes crypto liquidity management even more pressing for e-commerce businesses.

On the other end of the spectrum, giving customers the ability to transact with crypto can enable sellers to better serve unbanked and under-banked populations as these transactions can take place via a digital wallet on a mobile phone, in a matter of seconds, anywhere in the world. This type of nonbank service is gaining traction in emerging markets like the Philippines, Indonesia and Vietnam where digital wallets are the leading e-commerce payment method.

Save Time and Money 

Traditional payment processing can be slow and expensive for sellers, as legacy payment rails take days to fully settle and payment provider fees eat into margins. Crypto can alleviate these burdens and help smooth out payment operations for merchants while better serving customers through reduced fees and transaction times.

Unfortunately, these challenges increase exponentially for international transactions and in instances of high-volume, low-value sales. For the latter, e-commerce sellers can lose large chunks of revenue to multiple transaction fees, placing them at a disadvantage to larger players or those with higher value sales. 

Faster, more affordable crypto payments can turn these liabilities into areas of strength, helping sellers compete more effectively and improve their margins. Processing fees can be reduced by as much as 70% with crypto-enabled payments, generating savings to be passed along to customers to undersell the competition or be retained by the business as added profit. 

Crypto payments can also be much faster than traditional payments, significantly so for cross-border payments. In addition, the decentralized, trustless, immutable nature of blockchain technology can greatly reduce the risk of fraud, improve payment accuracy and even inventory management – generating more time and cost savings to boost the bottom line. 

Powering Crypto Payments with Liquidity Hub 

Designed to support businesses looking to bridge the worlds of crypto and fiat, Ripple Liquidity Hub is a turnkey solution that supports crypto payment and acceptance solutions. 

Available 24/7/365, it uses smart order routing to source crypto at optimized prices from market makers, exchanges and OTC desks, significantly reducing overall transaction costs. And because Liquidity Hub sources across multiple venues, it helps optimize pricing and supports liquidity pool redundancy. 

Ultimately, Liquidity Hub simplifies the way that enterprises buy, sell, and move digital assets. Its streamlined API and intuitive dashboard make it simple to deploy and manage, helping businesses avoid adding headcount or budget for crypto-specific support.

For merchants wanting to capitalize on today’s e-commerce economy to accelerate growth and boost profitability, Ripple is a trusted partner to hundreds of businesses and financial institutions across more than 50 countries with a proven 10-year track record in both crypto and finance. Learn more about how to transform e-commerce with crypto.

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