Choosing The Right Payment Option
Updated: Mar 19, 2020
The following is an article “Choosing The Right Payment Option” by Marc Primo.
Once upon a time, not too long ago, the only decision consumers had to make was which product or service they wanted to avail of. But that was then.
Today, not only are consumers faced with choosing between countless brands and services, they also need to decide which mode of payment best suits their needs. Whether it is cash, check, credit, debit, or cryptocurrency, how customers pay these days has become more scientific than ever before.
From a business perspective, it is therefore important to offer them as many options as possible. One way to achieve this is by taking into consideration the nature of your business, then studying which payment method is most suitable for your primary market.
Old school methods
Whether you like it or not, cash continues to be a preferred mode of payment for customers and merchants alike. It can be instantly liquidated, making life for accountants and managers a lot easier. However, cash also carries a stigma for being the preferred currency of dubious business practitioners as it allows for staying off the radar of tax auditors—so always have alternative payment methods for your business.
Checks might be a dying breed, but are still a popular mode of payment, especially when the transaction is between two parties who have already established trust with one another. Checks are ideal for high value payments as they eliminate the need to carry large amounts of cash around with you. On the downside, they are also the preferred payment method of swindlers, who leverage on the ease with which bogus checks can be produced. On top of that, granted that the check being issued to you is legit, there is no way of telling if there are sufficient funds in the account to which the check will be charged.
Nowadays, “charging” seems to be the most popular and convenient payment method, regardless of your type of business. Credit cards and debit cards are must have payment options for your business in order to be competitive.
Having that “AMEX, Visa, and MasterCard accepted here” signage not only attracts customers, it also reassures them that you operate a reputable and legitimate business.
From a customer perspective, it is in their best interest to be armed with one of these credit cards, even just for emergency purposes. You never really know when you’ll find yourself out of cash in your wallet, with no ATM nearby, and a payment needs to be made at any given time.
Bitcoin and beyond
While still in its early stages compared to payment methods mentioned above, cryptocurrency such as Bitcoin is something to watch closely. As mentioned in an earlier post, countries like China are leading the pack in terms of Bitcoin adapters, and the trend is slowly growing around the world. Shortly said, evolving with the times is crucial when determining the right payment option for your business, so always keep abreast with the latest financial trends and act accordingly.