Why use a merchant facility
A detailed summary of different merchant facilities
What Electronic Payments System is Right for You?
An e-payment system is a way of making payments for goods and services through an electronic medium, without the use of checks or cash. It’s also called an electronic payment system or online payment system. Please read on for more information.
Electronic payment systems have grown over the past few decades due to the increasing popularity of Internet-based banking and shopping. With the advancement of technology in the world, we can see the rise of electronic payment systems and payment processing equipment. As these increase, improve and the provision of safer online payment transactions, the percentage of checks and cash transactions will decrease.
The ATO has competed research that has found that consumers think that electronic payment is more convenient, more affordable and safer than cash payment. Nearly half of the respondents felt inconvenienced when there were no electronic payment options.
Consumers are twice as likely to associate “cash only” with negatives. This can affect your reputation and push customers to competitors who offer electronic options. Providing electronic payments will provide your customers with additional payment options.
For more help or information on any of these issues, feel free to call us on 1300 96 25 95 or alternatively contact us.
Four Main Systems for Electronic Payments
There are four main systems for electronic payments: Card terminal, Mobile, Internet, and Integrated systems.
As we look at each one, consider your business (what you sell, how it works), and who your customers are and what they want. These two issues shape what you need. For example, the important thing is:
-Your initial investment
-Automating the integration of your payment system with your other operations such as inventory and accounting
-Accepting payments online
-Mobile payment solutions
-do you have a physical location? If so, you’ll need to decide between a card terminal, integrated system, or mobile system.
-Do you want to be able to stay away from your physical location and take advantage of all mobile payment solutions? If so, a mobile payment system might be your best choice.
-initial cost of the system – some can be purchased outright, others can cost less than $10 a week
-transaction fees – some may charge a flat fee, others may charge a percentage for certain types of transactions
-how easy it is for you and your staff to use
-are you interested in taking payments online through a website?
The integrated system will provide you with a variety of solutions that not only handle payments, but also help you do business. That said, it does usually cost more to implement and maintain.
Mobile systems are the simplest to install and the least expensive, but there are restrictions such as theft (or loss) and device failure. Depending on the provider's situation, it can load value-added features or not.
A card terminal fits right in the middle – quick, easy and secure transactions at a low cost but without the ability to integrate into your operations.
There are plenty of options out there; you may want to talk to other business owners, or contact us directly for some unbiased advise on the choices available to you.
Credit Card Terminal
The credit card reader and terminal are located in your actual location, in the store. Many terminal devices, through the magic of the cloud, are now connected to the world of applications and can be more connected and connected than ever before. In most cases, they allow you to quickly and easily accept credit and debit cards and other payments while using the latest in chip security technology.
Benefits of credit card terminals:
-Secure transactions including the latest EMV chip technology,
-accept NFC/contactless payments such as Apple Pay and Android Pay,
-less expensive to implement than an integrated system, little training required
-It's also how many retail customers want to pay – the use of cards or contactless payments are growing.
-Less admin and paperwork
-being more cost effective per transaction (according to the ATO, tap-and-go payments cost nine cents less than cash payments)
-saving time and money per transaction (research shows that cash transactions can cost around 2.5% more when you include the time it takes to complete each transaction, balance the till and take money to the bank)
-reducing the risk of external and employee theft (card payments reduce mistakes and minimise security risks – cash businesses are more appealing targets for thieves)
-quicker transaction times for your customers (a tap-and-go payment takes on average about 20 seconds whereas a cash payment takes 38 seconds)
-convenience for your customers (not everyone will always have enough cash to pay for your goods or services – make it easier for potential customers)
So what are the problems? Cost to purchase and/or rent equipment. The bigger issue for more complex businesses is not being automatically connected with other business systems they use.
They’re often best if you have only one or two store locations, don’t have a website that you sell through and don’t require a lot of integration with other systems or connectivity.
So-called integrated point-of-sale (POS) systems have changed the game for many growing small businesses, enabling them to build sophisticated and interconnected business systems once reserved for larger companies. They also allowed small businesses to offer more advanced and high value-added customer service solutions, such as sophisticated reward programs. An integrated system offers the same processing of card terminal payments, as well as more advanced features such as the ability to communicate seamlessly with your inventory, accounting and other software. The integrated systems also offer the possibility of offering gift cards and loyalty programs.
Benefits of integrated systems:
-Secure transactions including the latest chip technology,
-accept NFC/contactless payments,
-better processing rates,
-ability to integrate various business operations (such as inventory and accounting) and
-added marketing tools such as gift cards and loyalty programs
The biggest issues with integrated systems has to be the cost. Firstly, the cost to purchase and/or rent equipment but it is also more expensive to implement due to training and programming required.
An integrated system can help a business with multiple locations run more efficiently. They can power up connectivity between and among sales channels for any small business, while adding important features like those called out above.
Mobile payment solutions allow you to accept payments on your mobile device, giving you the advantage of accepting sales wherever you’d like: a flea market, a sidewalk café, or while visiting a client, to name just a few. The potential uses are as varied as there are industries.
Benefits of mobile payments:
-Accept payments at any location, and any time
-easy to use,
-accept cards with EMV chips and NFC/contactless payments
The use of mobile payment systems has is own issues. The potential for theft or misplacing the equipment does clearly increase. There is also the cost of the card reader hardware. As with any technology, mobile device failure is also a potential issue.
Dongle-driven mobile payment systems are great for independent sellers, artisans, tradies, service people who make house calls-any type of business on the go. Mobile payment features are often connected with other terminal or integrated systems so that an in-store business can also be on the move when it needs to be.
E-payment systems are made to facilitate the acceptance of electronic payments for online transactions. With the growing popularity of online shopping, e-payment systems became a must for online consumers — to make shopping and banking more convenient. It comes with many benefits, such as:
-Reaching more clients from all over the world, which results in more sales.
-More effective and efficient transactions — It’s because transactions are made in seconds (with one-click), without wasting customer’s time. It comes with speed and simplicity.
-Convenience. Customers can pay for items on an e-commerce website at anytime and anywhere. They just need an internet connected device. As simple as that!
-Lower transaction cost and decreased technology costs.
-Expenses control for customers, as they can always check their virtual account where they can find the transaction history.
-Today it’s easy to add payments to a website, so even a non-technical person may implement it in minutes and start processing online payments.
-Payment gateways and payment providers offer highly effective security and anti-fraud tools to make transactions reliable.
Sounds great, so are there any drawbacks?
-E-commerce fraud is growing at 30% per year. If you follow the security rules, there shouldn’t be such problems, but when a merchant chooses a payment system which is not highly secure, there is a risk of sensitive data breach which may cause identity theft.
-The lack of anonymity — For most, it’s not a problem at all, but you need to remember that some of your personal data is stored in the database of the payment system.
-The need for internet access — As you may guess, if the internet connection fails, it’s impossible to complete a transaction, get to your online account, etc.
So which merchant facility is right for me?
The good news is you don’t have to pick just one system. All of these systems can work together, giving you the ability to sell in any manner you’d like. Be sure to look for a quality credit card processing company that offers all of these electronic payment systems and can further explain each, along with provide a clear path to implementing all the payment solutions you decide you need.
All too complicated?
Running a business is hard enough, if you want some advice on you can take advantage of this type of funding, feel free to contact us.