There is unlikely to be much change in the process for returning goods purchased this holiday season: paper receipts will continue to serve as proof-of-purchase for the vast majority of gift returns. Such is a reflection of merchants’ reluctance to invest in digital alternatives, with e-mail just recently becoming a popular receipting method amongst big box retailers. But some innovation has taken place in the e-receipting space, starting with the most unlikely of players.
To support the ‘invisible payment’ component of their business models, alternative transit providers like Sidecar and Hailo introduced e-mail-directed receipts that are delivered immediately upon ride completion. In contrast to the paper stubs provided by standard cabs, these receipts exhibit an extra layer of granularity related to the fare, providing information on: pickup/dropoff location, distance traveled, ride duration, driver name and, of course, amount charged.
American Express has also experimented with digital receipting, issuing a receipt through Apple’s Passbook immediately after a card transaction take place, giving cardholders the ability to quickly respond to fraud. These forms of digital receipting provide the consumer with additional purchase detail but are hardly more useful than the paper receipt. In reality, a true flight from paper calls for a dynamic e-receipt that alleviates burden associated with personal finance, shared pay and loyalty schemes.
Moven, a technology-oriented neobank, has excelled in integrating receipting with personal financial management (PFM). Its app allows users to categorize spend and enter transaction notes immediately following a purchase made with its debit card or smartphone sticker. This form of digital receipting enables real-time feedback on spend (i.e. over budget on Fast Food in December) and enhances the organization and accessibility of receipts to the consumer.
And while some use receipts to monitor personal finances, others use receipts to collect money from family and friends. For example, a consumer can pass the digital receipt for Dad’s new iPad to his siblings for quick reimbursement (Yodlee Tandem is looking to address this very use case through an app to be released in 2014). In a business setting, digital receipts also allow for quick preparation of expense reports for employers and clients.
Receipting can also extend into the loyalty space, where incremental rewards earned on the purchase of a sandwich can be displayed on a receipt, incentivizing customers to return to the shop for lunch the next day. The receipt might also include the individual’s point balance and list of valid coupons for exercise at the merchant. (Digital couponing is another area with significant potential that will be covered in a separate post)
In the digital age, every card transaction should be able to function as an e-receipt, storing data related to: the merchant, date of purchase, location of purchase, spend category, incremental loyalty rewards earned, itemization and other supplemental purchase detail. The dynamic nature of digital receipting adds granularity to personal finance, efficiency to shared pay and transparency to loyalty schemes.
The Rub: Digital receipts have the potential to remove friction from standard consumer activities related to personal finance, shared pay and loyalty schemes.