Knowledge Category: Payments
All transactions require information to be authorized, but certain transactions require more information than others. The amount of data required for a transaction determines if it is a Level 1 transaction, a level 2 transaction, or a level 3 transaction, and these levels can have an effect on interchange rates.
When was the last time you went to the grocery store and pulled out a checkbook in the checkout line? Or how about this — when was the last time you wanted to pay for an item and were told a merchant didn’t accept a credit card and required cash? The odds are that the last time you used a check at the store was a while ago (some merchants actually won’t accept them anymore!) and stores that don’t accept cards are now the exception that proves the rule.
New technology has expanded the ways we pay. Where cash was once king, credit and debit cards now reign supreme. Even that upsetting is in the process of dynamic change. As consumer lifestyle preferences shift and convenience is valued overall, many consumers are looking for even easier ways to pay online.
A February 2018 study from Pew Research found that 77 percent of Americans now own a smartphone. That’s more than double the amount of smartphones than when Pew first began tracking these numbers in 2011 (it was only 35 percent then). And as more smartphones make their way into the pockets of Americans, it’s more likely that they’ll turn to that device to make payments in their everyday life.