The benefits of using electronic payment systems
August 07, 2013

With many consumers choosing to go online to purchase goods and services, adopting electronic payment systems has become a smart move for small and medium-sized enterprises. While many SMEs may not believe accepting online transactions is an affordable option, investing in the credit card processing software can actually drive down business expenses while increasing sales. According to PYMNTS, allowing customers to buy products with plastic in both brick-and-mortar and virtual stores can not only be affordable but may also be a better financial investment than simply accepting cash or electronic checks.

Accepting plastic is essential in today's retail environment
PYMNTS suggested that as customer purchasing preferences change, SMEs should innovate their payment systems. According to the source, traditional payment types can pose risks to consumer finances, as cash or checks can be susceptible to theft. Instead, debit, credit and prepaid cards offer customers increased protection. Not only do many credit card companies and banks provide financial security, but credit card processing software allows SMEs to safely accept plastic payments. 

However, accepting plastic doesn't just offer shoppers numerous payment methods in brick-and-mortar stores. When systems are integrated with online stores, SMEs can increase sales in both the in-store and virtual environments. In an op-ed piece for The New York Times, Geoffrey Manne, executive director of the International Center for Law and Economics, wrote that electronic payment systems "provide merchants with fraud protection and valuable logistical tools, reduce labor costs and alleviate the cost of offering in-house credit."

According to Manne, integrating electronic payment solutions into existing credit card processing allows SMEs to accept debit and credit cards through their virtual store while providing the same benefits of in-store plastic payments in the online environment. 

"Properly understood, the price to merchants of accepting payment cards - often decried as a wasteful and unjustified tax on commerce - simply reflects the considerable benefits offered by electronic payments," Manne wrote.

As more consumers decide to buy products through virtual stores, investing in electronic payment systems will become vital for businesses. Not only does the customer benefit from the purchasing platform, but SMEs see advantages as well in fraud protection. With many SMEs beginning to accept sales through their website, not investing in electronic payment systems can result in financial loses. 

Nexus: G-WEBCD1