No matter what type of organization you are running, it is crucial that you keep up with the payment trends. Making it easier for people to pay or donate money, will encourage more of them to interact with your organization. The fact that 3 in 4 people who use the Internet, use online banking shows that the majority prefers online payments.
If you are still in the manual paying mode, you should seriously think about making some changes. This guide will provide you with all the necessary information about the online payments that you need. Once you completely grasp what online payment services are, how they work, and why do you need them, you’ll understand why so many companies are turning to this payment method.
The Introduction to Online Payment
The online payment system processes economic transactions over the internet. Therefore, money is exchanged electronically.
The vendor accepts payments over the Internet connections such as the web or direct database connection between the store and supplier.
A third party corporation runs the online payments and takes a small fee for its service. For example, it can take a small percentage of every transaction. Institutions who have a large number of transactions can sign a contract with a third party corporation and agree on the fee amount.
The proof that the significance of online payments is that most consumers, including 70% of Gen Z-ers and Millennials, have shown interest in digital payments consultancy and expense management services that enable them to better understand and control their spending.
After the consultancy or the training for digital payments, some business owners perfect the information they collect by using writing services to create a detailed guide. They give this guide to all their team members so that they can also be familiar with this process. Some useful writing and editing services they use are:
- TrustMyPaper – This helpful service engages in various types of writing and complies with the needs of their clients.
- Grammarly – For the final stage, people use this online editing and proofreading tool to check the content for mistakes.
People are trying to educate themselves about this phenomenon because online payments are predicted to become the main method of paying.
The Basic Online Payment Terminology
To understand online payment, you need to understand the terms that are used in this process. When talking about online payments, here are the terms that you’ll come across:
- PCI compliance – When the payment environment meets the Payment Card Industry Data Security Standard (PCI DSS) which is set by the Payment Card Industry Security Standards Council. It aims to reduce fraud by increasing the security of cardholder data.
- Payment gateway – Receives the online payment request from you and passes it on to the payment processor.
- Payment processor – It is a service that checks out the purchaser’s credit card information and validates whether he or she has enough funds to make the purchase.
- Payment service provider – The payment processor service that operates the payment gateway. Payment providers and payment gateways can be a single service in some cases.
- Payment service – Payment provider can offer more payment systems or payment services that have different pricing and features.
- Merchant account – The provider of products or services that the purchaser bought. The processed funds go to the merchant’s account. There are so many options while choosing merchant accounts. Some companies offer a payment gateway + merchant account. While some just offer a merchant account. And then there are low and high risk merchant processing providers.
All of these terms are an essential part of online transactions.
The Payment Process
The online payment process consists of the following stages (typically):
- Purchaser provides the payment information (for example, by completing the payment form) to the merchant.
- The payment information is transferred to the online payment gateway.
- The online payment gateway submits to the payment processor the payment.
- If everything is correct, the payment processor validates the payment and gives a response to the payment gateway.
- The payment gateway gives a response to the merchant.
- The merchant informs the purchaser if the online payment succeeded or not.
- The merchant takes the appropriate action based on the transaction’s success.
Choosing the Service Provider
Picking one out of many service providers that offer their services can be a real challenge. Consider the following factors when comparing service providers:
- Do they work with organizations from your country?
- Where will the payments be processed? Your or their website? (If this matters to you)
- Are the currencies you use transactions supported?
- What are their fees and how are they charged (monthly, per transaction, setup)?
- What type of payments do they accept (PayPal, debit card, credit card)?
Why Should You Use Online Payments?
What draws organizations and businesses to online payments are the numerous benefits it offers.
“Online payments are taking the payment world by a storm. The reason why is that it makes it easier for both the merchant and the purchaser to complete the money transfer and achieve their goal,” recently said Samantha Perry, a digital marketer at WowGrade.
To provide you with a better understanding of how useful online payments are, here are some of the biggest advantages of online payments.
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Expands the reach
The organization or the business will no longer be limited by location. With online payments, you can access people from all around the world.
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Increases sales
This accessibility is directly connected to increased sales. Logically, the more people you can reach out to, the bigger are the chances of making more sales or raising more donations.
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Meet the people’s expectations
Since people are more and more immersed in the digital world, they’ll prefer organizations that can keep up with digitalization. You can confront a challenge in the future if you don’t live up to customer’s expectations.
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Save the time
No one likes waiting in lines and wasting their precious time trying to make payments or deposit a check manually. Online payments will save time to purchaser because they’ll be only a few clicks away from finishing the process. You’ll also save you time because you don’t need to document the payments manually or store and handle credit card information.
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Speed it up
Online payments are much faster than manual payments. You can forget about waiting for the check to arrive or clear. The whole process will be done in a few seconds.
Deciding to make online payments a part of your organization or business can notably upgrade your current payment situation. Give online payments a try, innovate your organization, and improve your customer service.
online payment – DepositPhotos
