In-app payments refer to the facility of making purchases within a mobile app. Customers can carry out direct transactions within a mobile application without exiting it. They need not visit any separate website or a payment gateway.
Customers make payments within a site or an app to purchase certain products/services. Some websites and apps provide premium products and services after customers make payments to access them.
As they make payments for purchases, they are also referred to as in-app purchases. They are useful because-
- It enhances the convenience of customers and gives them a seamless transaction experience. They do not jump from one app to another for purchasing the products, services or subscriptions
- Merchants enabling the in-app payments feature can achieve higher sales and fewer cart abandonments. Customers may drop out if they have to put in time & effort for switching between apps, websites and payment portals
- This feature may provide customers with a one-click purchasing option. Customers can save their payment information after entering it for the first time. For the next purchases, they can click on the saved information and complete their one-click purchase. This simplifies the checkout process and thereby, reduces friction making repeat purchases quick and easy repeat purchases
- It is typically secure because the websites/apps enabling in-app purchases should meet security and privacy standards. Moreover, business merchants also prioritize the security of customers’ data to maintain their brand image. They often incorporate safety measures like card tokenisation, encryption, etc. This is to protect the financial information of customers and ensure secure transactions. Customers must ensure that they purchase from trusted apps
Examples: Use-Cases of Businesses with In-app Payments
Here are some examples of businesses that allow in-app purchases –
- Subscription/Online Streaming Apps: Online streaming apps like Netflix, Spotify, or Apple Music provide premium content and uninterrupted streaming to their subscribers. They also allow their customers to buy or renew their subscriptions while making in-app purchases. Customers can also automate their recurring payments for subscription purchases.
- Mobile Gaming Sites/Apps: Several mobile gaming platforms ask customers to pay for extra lives, power-ups, certain themes/characters, unlocking additional levels, etc. They also offer their customers in-app purchases.
- Ride-Booking Apps: With ride-booking apps like Uber, Ola and Rapido, customers can link their payment methods and book rides for themselves. They can link postpaid or BNPL services like Simpl and Paytm Postpaid, digital wallets such as Mobikwik and Paytm, UPI and cards to make in-app purchases or book rides.
- Food Delivery Apps: Food delivery apps like Zomato, Swiggy and others also let customers add their payment modes to order food. They can place orders by paying directly within the app.
- E-commerce & Online Stores: Several online and e-commerce stores provide a range of products and services to customers. By enabling in-app purchases, merchants can provide convenience to customers, get more pre-paid orders and eliminate the need for cash or separate payment transactions.
Above mentioned examples illustrate the diverse range of industries that employ in-app payments. However, these are just a few business streams that use and enable in-app payments. Other than that, customers can make in-app purchases of movie/sports/concert tickets, book hotels/flights, reserve seats in trains/buses, etc. Digital app stores like Apple App Store, Google Play Store, or the Amazon Appstore allow customers to buy games, e-books, music or movies directly from their store apps via in-app payments.
All these use cases demonstrate how customers can conveniently make in-app payments for purchasing products, subscribing to services, or accessing premium features without leaving the app.
