Businesses want P2P, ETA-TSG survey finds

Peer-to-peer payments, once the exclusive province of consumers, have spilled over into small businesses, gig workers and various other micro merchants, according to survey data released June 13, 2022, by the Electronic Transactions Association and The Strawhecker Group. In fact, P2P payment methods accounted for 59 percent of total transaction volume among merchants accepting P2P payments, researchers found.

Jodie Kelley, CEO of the ETA, attributed growing adoption to merchant efforts to improve the customer experience. "Merchants are responding to consumer demand," she said. "P2P payments were traditionally used for friends and family to pay one another. But as their usage grows, we find that consumers are interested in utilizing them to pay merchants."

Jared Drieling, senior director of market intelligence and insights at TSG, agreed that P2P usage is soaring. "The future of P2P payments looks bright – especially among newer establishments and gig workers," he said.

Open banking

Researchers cited open banking as a key driver of growing P2P payments adoption. "As P2P methods continue to see adoption with more consumers experimenting with side hustles to generate supplemental income, there is also a push among financial institutions for P2P methods to move upstream to larger businesses, powering the market overall and furthering a bright future for P2P," they wrote.

Despite some reports of P2P payments scams and other drawbacks—including uneven fee structures, poor dispute resolution and unexpected holds or delays in receiving funds—a majority of survey respondents were optimistic about P2P payments, including the 35 percent of merchants surveyed who also have a traditional merchant services provider.

Ease-of-use, expanded payments options

Findings, based on a March 2022 survey of more than 500 small and micro businesses in various industries and regions across the United States, indicated 82 percent of respondents accept at least one digital P2P payment option at their businesses. Following are additional survey highlights:

• Merchant experience: 92 percent of business owners surveyed reported they are happy with the P2P experience, citing ease of use, contactless capabilities, and lower price point compared to other card reader peripherals.

• Customer experience: Survey respondents were pleased with the overall speed and convenience of P2P payments, as well as the ability to appeal to younger customers, all of which improve the customer experience.

• Expanded payments options: Some survey respondents appreciated being able to offer more choices at the POS, and some micro merchants are using P2P payments exclusively, stating their businesses are too small to support additional payment processing capabilities.

• Bankable business accounts: 44 percent of business owners chose to leave a balance in their P2P business accounts instead of transferring funds into bank accounts.

To download a copy of the ETA and TSG infographic encapsulating this research, visit: www.electran.org/wp-content/uploads/TSG-ETA-P2P-Payments-Infographic-2022.pdf.

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