Are E-Commerce Processors Making Credit Card Payments a Thing of the Past?

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    May 22, 2014
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Are E-Commerce Processors Making Credit Card Payments a Thing of the Past? Photo by Emily Taylor

Alternative payments, such as e-commerce processors, exist to address needs that weren’t being met by traditional payments, but they won’t be content to simply satisfy those needs. They’ve already done that and now they’re on the road to glory, targeting the very market that was once the exclusive domain of credit cards. As e-commerce processors continue to grow, will credit card payments disappear entirely?

Credit card payments were the original digital money transfers. Before credit cards came along, all you had were cash and checks. Naturally, credit cards dominate the online landscape.
Now that the ways to exchange money or make a payment are nearly endless, checks have all but died out, but somehow credit cards live on. Why is that? What is it about credit card payments that allow them to maintain such a grasp on the market? And will it last?
Credit Cards vs. Alternative Payments
“Alternative payments” is a hard concept to grasp. It covers such a wide range of different tools, methods and platforms, and there’s no distinct difference that marks one type of payment as traditional and another as alternative. The only truly accurate definition of alternative payments is “any payment method that didn’t exist 25 years ago.”
But that begs the question: what happens when alternative payments become mainstream? What do we call them then? I grant that it’s confusing.
Alternative payments weren’t created in a vacuum. They arose to meet a variety of consumer demands that weren’t being met by credit card payments online. The main driving force in the rise of alternative payments was security concerns. The public grew increasingly aware of the risks involved in using online credit card processors and sought a way to shop online without revealing their credit card information.
That was the first chip in the veneer of credit card payments, and they have continued to erode slowly but surely ever since.
With the development of a variety of different gateways to accept online payments, the original demand for an alternative to credit card payments was met. Not only were alternative payment platforms more secure than credit cards, they were also more affordable. As these e-commerce processors grew more and more widely accepted, they began to introduce new features.
Now, online payment solutions have gotten to the point that they act like a digital wallet, which can be used anywhere without the consumer ever having to hand over their personal and payment information to the merchant.
A New World
There once was a time when people used to barter; they would trade one product for another, or maybe even trade a service for a product, or vice versa. Cash, in one form or another, eventually took over, and dominated the landscape up until about the 1950s, when credit cards were invented. From trading objects to online payment solutions, there have been countless changes that have taken place since the dawn of civilization, and we now find ourselves in a world where cold hard cash is being replaced slowly by other modes of payment.
The invention of online payment solutions is slowly making the world a cashless place. People used to go to the bank to withdraw cash, but now people never have to let cash touch their hands to buy the products they need on a daily basis. And now credit card payments are disappearing as well, in favor of fully digitalized e-wallets.

Today, more and more people are starting to shop online and use online payment solutions for their transactions because of how much more convenient, secure and affordable they are compared to traditional credit card payments. Since online payment solutions have come on to the scene, people don’t even need to go into physical stores anymore to get the products and services they needed; they could buy everything online and pay for it securely and instantly. It’s not just a Western phenomenon either; read this article to learn about the e-commerce revolution that is well underway in India, as well as around the world.

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