Digital leaders like Apple, Google and Spotify have shaped consumers’ expectations regarding user experience (UX). Big tech is using sizable teams of psychologists, designers, and engineers to deliver intelligible and even addictive digital experiences. It comes as no surprise that consumers apply these high standards to digital offerings of banks and payment providers as well. While banks as gatekeepers to the bank account persistently neglected to adopt these UX standards for their online offerings, FinTechs, and other third parties gradually began to attack this gap through innovative as well as customer-friendly deals. However, this sometimes happened in legal gray areas with corresponding risks for consumers as well as third-party providers.

Nowadays, due to various API-driven open banking initiatives worldwide and PSD2 in Europe, it is clear that banks are increasingly losing sole sovereignty over the bank account. Customers will no longer be as dependent on the bank’s digital offerings as they used to be. Authorized third parties can now gain direct access to account information or for payment initiation. As a result, users will have the freedom of choice in the front-end and can access their bank account from their preferred entry channel, be it social media websites, mobile messaging apps or other points of contact. UX in this context will be more relevant than ever and can be the golden key to keep the customer touchpoint.

A primer on UX

UX design involves the analysis, creation, and optimization of the user experience. This experience includes a user’s thoughts, emotions, and needs when interacting with a digital product. UX designers aim to improve this experience by reducing complexity of systems and leading the user to their desired destination as conveniently and quickly as possible.

The right UX strategy for payment providers has to weigh two conflicting main user goals. On the one hand, users want completely smooth payment. In its most extreme form, the entire payment would have already been processed by clicking “order now”. No username or password to remember, no forwarding to the payment page and certainly no TAN process. In reality, this is not yet possible and relates to the second important goal of the user. Payment must be absolutely safe. Strangers may under no circumstances gain access to the holdings of the user. Even just leaking the balance of a user would lead to a trust implosion and to abandonment of a payment service.

The golden rules for successful payment UX

For assessing the overall UX quality of a payment gateway we have devised eleven simple rules which are partially drawn from proven academic and industry standards such as Nielsen’s heuristics. The goal was to come up with heuristics that are rather broad, to both allow the application in different business as well as cultural settings while being specific enough to help management tick boxes when evaluating the UX of a payment service. Though some principles might look trivial on the first sight, various real-life examples prove to the contrary.

  1. Perceived security – Make them feel safe! Most users will not be able to realistically assess the security of a payment method. Therefore make sure to communicate your efforts towards the safety of your users.
  2. Visibility of system status – Users should be always informed about what’s going on and what comes next. Only then the user will feel in control which in turn increases perceived security.
  3. Consistency and standards – Surprises and confusion have especially no place when it comes to users’ money and confidential data. Keep the payment process consistent and draw on accepted industry standards.
  4. Lean data input – Minimize the input of personal data needed and make suggestions for recurring inputs.
  5. Effortless authentication – Secure user authentication can be a major hurdle in a payment transaction and should be mitigated by cutting edge technology such as artificial intelligence algorithms or voice pattern recognition that can reliably validate a person’s identity.
  6. Responsiveness & mobile readiness – Blending of desktop and mobile has arrived and payment methods can only succeed if they are fully available in both worlds.
  7. Aesthetic and minimalist design – Less but better. Focus on what is important and present it in a beautiful manner. A professional looking design will among other factors enhance a solutions’ perceived security.
  8. Help users recognize, diagnose, and recover from errors – Errors should not occur but if they do, users should feel confident and informed enough to give it a second try.
  9. Notification & documentation – Allow users to get instantly notified about transactions and analyze past transactions.
  10. Educate sellers/cashiers – Retail partners ultimately decide how the intended payment process is executed. By working closely with these partners error rates can be decreased.
  11. Gamification – People, in general, don’t like to spend money – by integrating Gamification elements providers can increase loyalty. Gamification can be anything from rewarding redeemable points to savings challenges in an online bank account.

Embrace the opportunity now

The importance of UX in payments can hardly be stressed enough. We all know that a lot went wrong in the past but we also see things changing for the better. Today, invoice payment with only your email address plus zip code exists and 3-D secure for credit cards is encountered less and less. It should be clear that the quest for superior UX design is a continuous process which will never be done and dusted for any consumer payment service. De facto this process picked up speed in recent years due to various technological and regulatory changes. Now, with open banking, Banks are well advised to ramp up their own UX activities or form strategic alliances in order to keep the direct customer touchpoint. Payment is synonym for one of the most precious resources of today’s age: data and user engagement.

About the authors

Jakob Schniewind

is a management consultant for EY Innovalue’s payment practice and author of articles on payment

Josef Mayerhofer

is Managing Director of Empatic – UX Strategy and lecturer at Technikum Wien University of applied sciences