Most businesses see transaction methods as one of the many touchpoints in the customer journey. However, the rapid acceleration in technology since the global pandemic has shown that online payment solutions for small businesses will be instrumental in the growth of the enterprise. With the constantly evolving technology, there has been a revolution in the electronic payments domain. Business owners no longer need to frequent banks for depositing payments.
64% of small businesses in the US don’t yet use a website, let alone online payments. If your business has not implemented electronic payment solutions, there are several great benefits that you should consider. There are also a few challenges, but overcoming them can help you maximize profits and increase your customer base.
Benefits of Electronic Payments for Businesses
To function smoothly, businesses need to ensure a high cash flow. Online payment solutions for small businesses can help save both money and time by processing payments rapidly. For this reason and its many other benefits, more and more businesses are moving towards electronic methods of payment for their customers.
Electronic payments make it easier for business owners to make cash applications and let you maintain and update accounts and records with accuracy. This ensures that accounting errors get eliminated and you can keep your records clear.
These are just a few advantages of using electronic payments. Let’s deep dive into other key benefits of the fasting-growing method of payments today.
Electronic payments can be completed much faster than traditional modes like cash or cheque payments. There are no physical limitations such as location or time. You can make payments easily from any place at any time. Online payments have removed the need for customers and businesses to go to banks for making payments. Using an e-payment app, transactions can be carried out instantly.
Online payment solutions provide businesses with many ways to secure payments. This includes but is not limited to encryption, SSL and tokenization. This means customers no longer need to enter their entire list of details like card number, expiry date, CVV code etc. Their card details are saved onto the e-payment app and they can complete transactions by verifying these encrypted details and an OTP (one-time-password).
More convenience for customers:
Electronic payments provide customers with a convenient experience every time they complete a transaction. There are several methods that customers can choose from such as buying on credit, EMI payments and the facility to pay later. This ensures that customers don’t need constant payment reminders, rather the e-payment system automatically takes the money from them after an interval.
Reduced costs of processing:
To enable payment services, you must first find a card processor and tie-up with them for payments. This processor will give you a payment gateway to process payments in exchange for a fixed cost. But this cost is significantly high. Meanwhile, electronic payment systems don’t incur high processing fees. Businesses must simply pay the subscription fee to the service provider.
Reduced risk of loss:
There are many limitations to using physical modes of payment like cash or cheques. If you are moving about with cash, you are always prone to theft or snatching. There are also chances of the cash getting damaged or destroyed which can devalue it. You also need to ensure security precautions while depositing the money into a bank. Using electronic payments completely removes this risk. You no longer need to worry about theft or loss, or even your payment record. Since everything is automated, you can get a highly accurate account of all your transactions whenever you need.
While dealing with payments, transparency is an essential factor for both the business and the customer. If you are using a digital medium to accept payments, it is all the more important to ensure transparency. Electronic payments remove most concerns about payment details. All the details are provided to the customer before they make the transaction and they get notified of the payment immediately after the transaction goes through. This removes any misunderstanding or confusion that either party could face.
With the onset of the global pandemic, there has been a global surge in perfecting ways to avoid physical contact among people. People have been trying to stay away from any form of touch to avoid getting infected. This has resulted in high demand for contactless payments. Businesses can take advantage of contactless POS units to avoid contact during payments. In this case, the customer holds their phone near the POS unit and payment gets processed. Another option is using OTPs or QR codes to help customers process payments.
Electronic payment mechanisms might seem complicated, but once you start it’s not that complicated. Familiarise yourself with the different steps and processes within the electronic payment procedure to start your move towards accepting online payments. For small businesses, this helps provide an improved customer experience and a larger customer base.