In our current digital age, countries like Canada are just about ready to give up cash altogether, with half the population agreeing that getting rid of banknotes and coins is a good idea. If your business doesn’t have alternative payment solutions in place, you’re losing out on a steadily growing customer demographic.
There’s no need to worry about this issue though. If there’s one reason countries are looking to become cashless, it’s because there’s a world of choice for alternative payment solutions out there. In addition to plastic methods like debit and credit, cashless systems like wire transfers, mobile apps, and points redemptions are also on the rise.
Choosing the right alternative payment solutions for your business can be a bit confusing, but we have some foolproof tips for you to consider.
Align Your Alternative Method with Your Business Type
Ultimately, you want an alternative payment solution because you want a method that will help your business grow. To determine what solution would best facilitate growth, you need to know what type of business you’re running—and we don’t just mean your industry. What’s more important? Whether your business is considered high risk or high volume.
High-risk businesses can be classified as those that are financially risky (e.g., low credit, previous bankruptcy, etc.) or risky because of industry reputation (e.g., marijuana dispensary, car dealership, online gaming, etc.). If you’re a high-risk merchant, you’ll need a provider that can give you reliable payment processing. High-risk businesses are often faced with more expensive payment processing rates than others.
High-volume businesses are often lumped in with high-risk companies because they often deal in down payments on future deliveries. Future deliveries are high risk because there’s a chance that, due to financial troubles or a business shutting down, customers will not receive their goods even though their card payments were cleared.
High-volume businesses should always question providers about extra security, both for themselves and their customers’ financial protection.
Your Business Environment Can Determine the Best Alternatives
Customers like payment solutions that increase the overall convenience of a transaction, which accounts for 48 percent of the 50 percent of Canadian customers willing to go cashless, according to a 2017 Payments Canada survey.
Think about what kinds of products you’re selling and how they are distributed around your storefronts. If you’re running a restaurant or a delivery service, customers’ convenience is maximized by a mobile and easy access payment solution. Mobile terminals that accept debit and credit are ideal in these instances. However, if you’re running a car dealership, you might be better off having a countertop terminal for partial down payments.
Chargeback Protection Can Make All the Difference
Chargebacks, which are disputed charges to a customer’s card, can derail your business’ goals. Whenever your business faces a chargeback, the funds that are disputed are auto-debited from your account and withheld for an indefinite period of time while the dispute is investigated.
The immediate impacts of chargebacks are fairly straightforward. You might experience poor financials for a certain month and be overdrawn.
Though you can prevent some chargebacks, you can’t avoid them all. That’s why chargeback protection insurance as an accompanying feature of alternative payment solutions could be what makes or breaks a provider’s offered plan. Make sure you inquire about possible all-inclusive pricing, which sometimes offers up to $1,000 chargeback insurance.