Payment option diversification allows businesses to cater to a broader consumer base, expanding their reach and increasing sales. If you’re a business owner, know that your company can expand its reach and access new categories of clientele. Either locally or internationally, by making local payment options available to target regions. Mobile payments like Apple and Google Pay, digital wallets like Buy Now Pay Later or PayPal, and cryptocurrency wallets have become viable alternatives to cash.
Payments can nowadays be made in cash, transfer, debit and credit card, exchanged services or cryptocurrency. Owning a business comes with the responsibility to satisfy as many needs as possible. If you’ve ever dreamed of having a start-up or you already own a well-established company, keep reading to understand why it’s good to have more than two payment options.
Easing the Checkout Process
When facing over-complicated checkout processes, many customers abandon their shopping cart and search for their favourite products elsewhere. Providing many and various payment methods like mobile payment apps and virtual payment methods has its advantages and drawbacks. Here are some examples of payment types:
– Cash. It’s one of the easiest payment forms and is expected to be accepted everywhere. However, many customers avoid money when making large purchases, as storing and transporting huge amounts can be dangerous.
– Checks. Customers may make greater purchases with checks, as these remove the need to have cash on hand. Checks allow purchasers to make safe payments, but the downside is that banks take time to process the money transfers after they’re deposited.
– Prepaid, debit, and credit cards. Foreign travellers can purchase more easily, which may make customers want to make more purchases. However, they can enable fraud, and often has transaction fees – a small percentage of the transaction.
– “Quick Response” codes. These are perfect for customers who want a hands-off experience, as there’s no need for a POS or specific apps to be accessed. They require a strong WiFi connection, though, and because they don’t store information, customers may be require to input debit or credit card data.
– Cryptocurrency. When used as a payment method, cryptocurrency is simply a value token or instrument that can be traded online for products and services. Their underlying technology is blockchain, a decentralise platform that handles and records transactions over a network of computers, meaning that this market is unregulate and is dominate by versatility and liquidity.
With cryptocurrencies growing increasingly popular, this is a topic that many are wondering about. It is ultimately up to you whether or not to take Bitcoin, Ethereum, and the like payments on your website, but if you do, you must acquire the proper setup.
As popular as cryptocurrency has grown (Bitcoin has a market cap of over $1 trillion), it continues to split views. However, it can be a good marketing tool for your company and show people your staff is innovative and isn’t afraid to embrace new technology. It may be most appealing to middle-aged men, but there are also people in their 60s who are fond of digital assets. Big companies know these facts; for example, Whole Foods and Microsoft appeal to youth and tech-savvy audiences.
It may be financially rewarding if you decide to accept crypto on your site, but it needs some research. Bitcoin and Ethereum, most of the time, have zero to low transaction fees. Suppose you own digital coins. Many entrepreneurs check the Ethereum price in USD to decide if they further keep or get rid of their assets, or figure out if they’re in a bear or bull market.
Promoting Financial Inclusion
Different payment methods are offer to cater to more tastes and needs. But these things differ from region to region. If the population is unbank, most likely, Bitcoin payments won’t cause a furore across the country. But if the respective nation is as familiar as the United Kingdom or the United States to cryptocurrency. Maybe customers in these situations might be accommodate by businesses that provide digital payment methods such as digital money transfers and mobile app payments.
One reason to keep cash payment options available is to welcome the unbanked. However, cryptocurrencies have long been discussed as governments and financial institutions open up to decentralised finances (DeFi).
Automating Transactions and Eliminating Intermediaries
That means financial institutions are being phase out in favour of automation and peer-to-peer (P2P) transactions. The resulting permissionless transactions are at the heart of a diversifie variety of newly develope financial products to enhance access to financial services. While occasionally offering new products and services unavailable outside the DeFi ecosystem.
Using cryptocurrency in DeFi services represents a significant global solution for unbanked banking. Consumers can buy and store BTC, ETH, and such cryptocurrency in virtual wallets, make transfers from mobile devices, invest in global asset markets, and access alternative credit markets without interacting with standard finance infrastructure.
Blockchain payment networks enable users to immediately send and receive money at a fraction of the cost of traditional banks. These payment options represent a seamless, low-cost way for the unbanked — and even those with typical bank accounts — to participate in the global economy.
While blockchain networks such as Bitcoin and Ethereum are excellent for sending money between individuals, applications such as BitPay and Circle Pay allow you to transmit money using only your phone number or email address.
Aside from generational differences, there are other reasons why some shoppers may favour one payment option over another. For example, fund availability is a frequent consideration. Shoppers who can’t access funds immediately may prefer to pay with credit cards. In contrast, shoppers who don’t want to risk debt and can access funds right away may prefer debit cards. Meanwhile, other customers may opt to pay with a line of credit. If they are wary about their money’s fraud protection. The list goes on, but the point is that customers’ payment habits will vary.
The list could go on; the point is that customers’ payment habits vary. If your company only accepts a few payment methods. You may unintentionally exclude some potential customers based on their payment habits.