The cost of friction: What 1,500 merchants told us about payments in 2026

Payments friction is no longer just a minor annoyance; it is a primary driver of merchant churn. A new survey of 1,500 merchants reveals that by 2026, the checkout experience will define business success. For retailers and operators, this means the 'last mile' of the sale—where financing and payment processing live—must be invisible and instant. If your current financing platform requires too many steps or suffers from high decline rates without explanation, your customers are likely to abandon their carts for competitors with smoother workflows. The report highlights that merchants are increasingly looking for 'embedded' experiences. They want financing options like Buy Now, Pay Later (BNPL) and installment loans to be integrated directly into the point of sale rather than acting as a third-party distraction. Operators should note that the cost of payment friction isn't just a lost sale today; it is the long-term loss of customer loyalty. By 2026, the expectation is that payment platforms will proactively solve for fraud and authorization failures without requiring merchant intervention. If you are evaluating new lenders or financing partners, prioritize those who offer automated, low-friction API integrations over clunky, manual portals.

Source: Payments Dive

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