Online payment enables your customers to make non-cash payments for goods and services through cards, mobile phones, or the internet.
It offers a number of advantages including cost and time saving, the increase of sales, and the reduction of transaction costs.
However, it is susceptible to online fraud and might increase business expenses.
Online payment methods
Payment methods vary between countries, from prepaid cards to credit and visa cards, in addition to bank transfers, e-wallets, smart cards, or digital currency wallets (Bitcoin being the most well-known).
Advantages of online payment
Increasing speed and convenience
Online payment is very convenient compared to traditional methods of payment such as cash or checks, since it is possible to pay for goods and services online at any time of the day or night, from anywhere in the world.
With the prevalence of online banking services and shopping on a large scale, the number of people who pay with cash is declining.
As per the website Bankrate, more than two-thirds of consumers carry less than 50 dollars per day, which means that electronic substitutes have increasingly become the preferred payment option.
Thus, online payment enables companies to make sales to customers who choose to pay online and to benefit from a competitive advantage over those who only accept traditional payment methods.
Reducing transaction costs
Although there are no additional fees on making cash payments, going to the store usually costs money, and checks also incur postal fees.
On the other hand, there are usually no fees – or very small fees – on using your card or online payment.
On the long term, online payment can save hundreds of thousands of dollars on transaction fees for individuals and companies.
Disadvantages of online payment
1. Security concerns
Although there are strict measures such as symmetric encryption to make online payment secure, it is still susceptible to pirating.
For example, fraudsters use phishing to trick unsuspecting users to provide login information of their e-wallets, which are captured and used to access personal and financial information of the victims.
In addition, insufficient authentication undermines online payment systems. Without exceptional identity verification measures, such as biometric and facial recognition, any person can use cards and e-wallets belonging to someone else and get away with it.
These security concerns might make some people reluctant to use online payment systems.
Your customers do not have to spend their time waiting for their turn to pay like in traditional stores, or to wait to receive a check or cash from the bank to be able to access the money they need for shopping.
Online payment also eliminates security risks that come with dealing with cash money.
2. Disputed transactions
If someone uses the e-money of your company without your authorization, you will identify unusual fees and submit a claim to the bank or the online payment processor or the credit card company.
Without sufficient information about the person who completed the transaction, it might be difficult to win the claim and get your money back.
3. Increasing business expenses
Online payment systems come with the increasing need to protect sensitive financial information that is stored in computer systems of companies from unauthorized access.
Companies that have internal online payment systems should bear the additional costs of purchasing, installing and maintaining advanced payment security techniques.
Finally, I would like to point out that most companies offer secure and convenient payment methods to their customers and, most importantly, with the click of a button, like the Fatora application.
Fatora offers you flexibility in the payment of invoices such as sending a payment link, creating a multiple installments invoice, or creating an invoice for monthly payments, all this and much more in one application.
Many companies have resorted to using technical methods such as credit cards, fingerprint devices and others. These modern methods have clearly advanced and flourished in companies that use them.
Applications that companies use for online payment transactions
What are the benefits of upgrading businesses from traditional to technical?
- 1. Speed of operations whether communications or accounting entries or invoice payment.
- 2. Guarantee against loss of information.
- 3. Possibility to securely share company confidential information.
- 4. Avoiding the loss of papers and documents.
- 5. Space-saving and organization in companies, reflects a civilized and sophisticated image of the company.
- 6. Motivating employees to use modern methods.
It is worth mentioning that most companies seek to use online payment methods to organize their financial operations because online methods enable you to:
- Collect your money from home and in the shortest time possible.
- Pay your bills within seconds.
- Request the payment of your money with the least amount of effort.
- Send your invoice by email or phone or even WhatsApp.
- Complete the largest number of online financial transactions in a very simple way.
- Know what you have to pay and collect in a determined period of time and get reminders of your requests.
Have you tried Fatora?
Fatora is an online payment application that enables you to send invoices to customers and enables the customers to pay invoices whether in cash or through payment cards, i.e. Visa and MasterCard, in addition to many great features and free services that the application offers.