As the COVID-19 pandemic continues to drive consumers indoors and online, small and medium-sized businesses, or SMBs, are quickly learning that they can no longer rely on physical payment methods to keep the cash flowing. Whether by desire or necessity, consumers are moving their spending online. What’s more, even when the pandemic subsides, many believe consumers may never go back to shopping as they did before.
While the pandemic has certainly fueled the current migration to e-commerce, the reality is digital payments have been rapidly evolving thanks to advances in online payment processing, electronic payment technology, as well as mobile and wireless technologies. And while e-commerce’s portion of the total share of the global retail market is still relatively slim — at the end of 2019 e-commerce still made up just over 14% of all retail sales — much of the growth in the retail sector, for example, now occurs in online sales. Knowing this, many SMBs are consolidating their solutions and turning to fully integrated payments platforms to manage this process. Here’s why.
In today’s business world, customer experience is the new gold and is rapidly becoming the principal competitive differentiator in the online payment universe. For example, over 80% of consumers say they must trust a brand to do what is right, and this factor plays a major role in shaping their purchase decisions.
Businesses must view the COVID-19 crisis as an opportunity to foster customer trust and develop customer relationships. Integrated payments platforms can provide solutions designed to streamline the relationship with your customers; these enable your business to easily email customer receipts, safely store customers’ credit card information securely via tokenization file, and set up automated recurring billing. Businesses can leverage these data points so customers receive the type of assistance they both want and need. This approach can then lead to future sales opportunities, fueled by buyer loyalty.
In today’s fast-paced business environment, being able to accept all forms and methods of payment can be the difference between a sale and a walkout. The coronavirus outbreak is prompting second thoughts about reaching for cash, and these new virus fears could be enough to introduce methods such as mobile payments to those who otherwise didn’t see the appeal. In fact, 42% of U.S. consumers state they would stop a purchase if their favorite payment method wasn’t available. An integrated payment platform offers customers a broad spectrum of payment options, enabling them to use their preferred payment method.
As consumers shift to digital payment methods, using an integrated payment platform can easily save businesses from processing payments through multiple vendors. Since there is no longer a need to manage numerous integrations and vendors, one doesn’t have to allocate as many resources to the process. This enables businesses to cut costs in a substantial way, which in turn sets the stage for higher income. Less paper, more integration, increased profits.
A recent U.S. Bank study by Jessie Hagan found 82% of businesses fail as a result of cash-flow mismanagement. Getting paid on time isn’t always easy. Integrating your business’ payments helps ensure that cash flows get documented in real time when transactions are completed. Without this ability, long wait periods for invoice payments and other delays could disrupt business operations. An integrated payments solution provides up-to-date reporting and an accurate depiction of cash flow. Knowing how much money your business has available each day helps one better manage operations and inventory, along with paying vendors and bills without dipping into the red. This task of cash-flow management is especially critical during periods of economic volatility and uncertainty.
Before the option of integrated payment solutions, businesses had to wait for a batch report and then manually enter transaction data into accounting software. This process left ample room for human error, such as incorrect data entry, duplicate data entry, or applying data to incorrect accounts — something that is unacceptable for businesses operating in the wake of COVID-19. Simply put, labor-intensive data entry can lead to costly mistakes and those mistakes can be time-consuming to discover, locate and correct. The automated, seamless flow of transactions from multiple channels (in-person, online, using a mobile app, etc.) directly into your general ledger or other accounting system eliminates much of this concern, giving way to confidence in your accounting and reporting.
Data breaches and fraud are a growing concern across the board. With more than 270,000 reported incidents, credit card fraud was the most common type of identity theft last year and more than doubled from 2017 to 2019.
An integrated payments processing platform helps protect your purchases from fraud and security threats. The platform provides a 360-degree view into payment data, helping to ensure anomalies in processing are identified and any sign of fraud is managed and acted upon. In addition, integrated payment platforms offer business value-added services like tokenization and end-to-end encryption, which contribute to a higher standard of payment security. Safe, secure, reliable payments that maintain the privacy and integrity of data are essential to protecting your business and maintaining the trust of your customers. Integrated payment systems deliver on security that can improve consumer confidence and retention rates and help your business keep more of what it earns.
The world as we know it has changed drastically in reaction to the COVID-19 pandemic. Phrases like “social distancing” and “flattening the curve” have become part of our daily discussion seemingly overnight. Fortunately, we also live in an age where technology allows us to conduct business in ways that may not have seemed possible just a decade ago, including payment services that provide incredible flexibility for companies as they meet the changing needs of their customers.
As we all continue to adjust to the new normal, businesses must realize that if your business is not efficiently processing payments digitally, now is the time to take action. What is certain, online payments are becoming ubiquitous — and that represents an enormous opportunity for businesses to take advantage of the benefits of a fully integrated payments platform.