Electronic payment systems are beneficial for businesses as they facilitate the payment and collection of payments. It is an effective solution to keep customers, suppliers, and employees informed about their financial transactions. It can be of great help to track purchases, sales, and payments of suppliers.
A lot of benefits are enjoyed by companies who use electronic payment. They are able to improve their customer service levels and to make the process of buying goods or services easier and quicker. Businesses can save time and money. It helps to reduce losses, which can be recovered by reduced charges on receivables and payments.
There are many electronic payment systems available in the market. It varies from one system to the other. It can be in the form of credit card, debit card, EFT, or e-check. Some of the most popular systems include:
Payment Gateways – The online payments allow users to select the products they want to buy and enter the amounts they want to pay for. These online gateways will provide the necessary information to your customers and the suppliers. Then, the users will be sent a transaction confirmation number to their registered email address. Once the user has confirmed the transaction, he/she will be prompted to log on to a secure website from which they can pay with a credit card or other types of debit card.
Debit Cards – These are issued through a bank and are used to pay for goods and services. The amount of the debit card is deducted from the funds held in a bank account. These accounts can either be a checking account or a savings account. There are many different providers and they will vary depending on the rules and regulations of the bank.
Electronic Funds Transfer (EFT) – The electronic funds transfer is a form of electronic transfer wherein money is transferred from one bank account to another. This method is more convenient than other methods as it can be done from any part of the world with minimum delays and minimal costs. In this system, the customer will need to open an account with the lender of the account and he/she will then need to give the bank a post-dated check which is transferred automatically to the account of the lender at specified times intervals of the day.
Credit Cards – The credit card is a card that is issued by a bank and it is usually carried by customers. You can choose a specific bank account from where you want to carry your credit card and use it to buy goods. The bank keeps a record of all the transactions made with the card.
When you want to transfer money with a debit card, you need to insert the card’s magnetic stripe into the machine and the transaction is completed automatically. If you do not have a card, you may go for a cash or check.
EFT also allows the transfer of funds from one bank account to another bank account at a specified interval. For example, the payment could be done every time your customer buys something for him/her or herself. EFT can also be used to withdraw money from your account to another account.
You also need to know that you can transfer funds from your bank account to another bank account using EFT. The only difference between the electronic transfer and the traditional transfer is that in EFT, the bank account you want to transfer the money from is not required.
Another advantage of EFT is that it has been known to improve customer relations between banks and card processors and merchants. Since EFT is fast and easy to access, it can cut down on the cost incurred on the account by the merchant since there are no long queues to enter into the card processing machine and to wait for the transaction to finish. Since you can conduct your business in a relaxed manner, you can concentrate on the tasks at hand, hence you will get more orders.
Lastly, EFT is very good for business owners because you will be able to offer competitive prices when you deal with smaller financial institutions. Although many people are apprehensive about accepting electronic payments, once you get familiar with it and have established a relationship with these institutions, you will soon find that it works out very well.