Currently, there are 6.92 billion smartphone users in the world, with many of these individuals using their devices to shop online. Electronic banking has become increasingly popular in recent years, with many businesses around the globe embracing digital payments and reaping all their incredible benefits.
Simply put, digital payments (or e-payments) are transactions that don’t require physical cash, as they are made electronically by using credit or debit cards or digital wallets like Google Pay and PayPal. Now, customers can also buy ethereum with debit card, thus putting their crypto to work by purchasing goods and services. It is estimated that by 2024, 50% of all transactions will be carried out through a digital wallet.
What are the different types of digital payment methods?
Significantly fewer consumers want to pay with cash – instead, they are looking for safer and more convenient payment options. Hence, businesses should provide several digital payment options, which can include the following:
- Digital wallets enable customers to store bank information or credit card data electronically and can be utilized online or via smartphone apps in person.
- Cryptocurrencies like Bitcoin and Ethereum are increasingly becoming popular among business owners, due to the benefits they provide, including ease of use, speed and enhanced security.
- Credit and debit cards are a very popular method for paying digitally, and they are widely accepted by businesses worldwide. They can be used both electronically and in person.
- Bank transfers enable customers to deposit cash from their bank account into the account of the merchant, whether through ACH or wire transfer.
What are the benefits of digital payments for businesses?
These days, it is impossible for businesses to stay competitive unless they go digital. While accepting electronic payments may seem optional, in reality, the success of your business greatly depends on this decision. Let’s take a look at the benefits of digital payments.
Let’s be honest: everyone seeks convenience nowadays. Luckily, digital payments can provide that for both businesses and customers. Individuals can complete a payment wherever they are without carrying money or visiting a physical location. All it takes to pay for something is a simple tap or swipe.
Digital payments are considered much safer than physical credit cards, cash and checks, which can all be stolen. This is due to the advanced security features they provide, such as tokenization that safeguards customers’ details. Digital payment options, such as mobile apps, rely on face ID or fingerprints, and the role of these biometrics is to authorize purchases. Moreover, using multi-factor authentication can protect ventures from fraudulent transactions, as it is used to prove the card holder’s identity.
Increased customer satisfaction
Offering customers digital payment alternatives is a great way to improve their shopping experience. Through their increased speed and convenience, digital payments help ensure a seamless checkout process, which can result in enhanced customer satisfaction. Many digital payment options are available, but the idea is to choose those that are preferred by customers. This way, people will be more likely to complete their purchases, decreasing car abandonment.
Using traditional payment methods can limit the potential of your venture. Digital payments can be the ingredient you need to generate more sales and grow your business further. They are a great step towards entering the digital business space or providing a new subscription-based model for your venture. Let’s say your goal is to extend your brick-and-mortar locations. By accepting digital payments, you can improve scaling, reducing the time required to process and collect payments. Ultimately, this will also help you attract new customers.
The checkout experience can be inconvenient when using traditional methods for payments. Not only is it time-consuming to deposit checks and cash payments into a bank, but it also decreases cash flow. On the contrary, digital payments enable you to complete payments near-instantly, thus accelerating the checkout process. Digital payments can be made through a quick swipe or tap, whether online or in-store, simplifying the transaction. This way, you’ll have cash deposited into your account without visiting a bank. This not only improves real-time cash flow but it also makes your life a lot easier.
Getting started with digital payments: important considerations
Perhaps you’ve decided you want to take your business to the next level by accepting digital payments. However, before doing so, there are a few things to keep in mind so you can find a suitable provider for your business.
- Security. You want to look for a provider with an excellent reputation for safeguarding customers’ sensitive data and using industry-standard security protocols. So, make sure to require details about what kind of encryption approach they use.
- Integration. Consider how much effort it takes to integrate the electronic payment service with your current systems, like accounting software or website.
- Reputation. The provider’s reputation is an essential aspect to look for when looking for a digital payment service. So, research them to check whether their mentions in the news are positive. Reviews can also be a great way to ensure that the provider offers trustworthy services.
- Scalability. If your venture is flourishing, and you believe transaction volumes will rise considerably, it’s essential to determine whether the provider can scale with you.
- Currency support. Suppose you conduct business globally; you want to check if the provider supports the currencies and the countries where you carry out your operations. There may be some limitations, so you want to consider this aspect carefully.
- Fees. Obviously, fees are one of the most important factors to keep in mind when searching for the right provider. They should provide transparency regarding all the monthly fees, chargeback ones and those related to transactions.
The bottom line
Businesses should understand that going digital is no longer just a trend. In fact, ventures that aren’t willing to embrace digital payments can miss out on great efficiency and a better customer experience. Nowadays, customers’ preferences have changed significantly, and since most online buyers are tech-savvy, being able to pay whenever and however they want is a great advantage for them. Ventures that offer multiple digital payment methods can meet modern customers where they are and meet their expectations, which will ultimately be a catalyst for business growth.