Offline and Online Payment Solutions for Businesses

Offline and Online Payment Solutions for Businesses

Payment solutions are required by organizations, retailers and any firms which require transactions to be carried out between them and their customers. This can either be in the form of an online or offline payment solution, but it depends on the company and which payment methods they choose to offer their clients.

Depending on which industry a company operates in and how clients pay for goods and services, the payment solutions will need to be accessible and suited to your business needs. Many companies now tend to establish online payment solutions in contrast to the traditional offline methods due to the worldwide appeal of them and easy accessibility the internet offers.

In order to determine which payment solutions are best suited to your business, companies need to understand the different options available to them.

Online Payment Solutions

An online payment solution is a method which requires the internet as a platform to carry out payment processing. There are various methods of online payment solutions available and most companies strive to offer a variety so that they appeal to a larger audience:

Credit Cards: a type of money card which enables the cardholder to spend a specific amount which is repayable on competitive interest rate. They are available worldwide and offered to individuals as well as businesses. The main advantage of credit cards is that they allow the holder to have flexibility in payment of their purchases as well as the freedom to pay it back over time, with interest rates applying.

Debit Cards: is a type of card which the bank issues to a holder for them to access their account. A debit card allows holders to access cash at any time through an ATM machine as well as use it to make payments at POS terminals or online. The main advantage of debit cards is that they provide high security to their holder as well as accessibility to funds at any time.

E-Checks: is an electronic version of the traditional paper cheques, used to make online payments. In this alternative method of payment transaction, you can pay for good/services without having a credit card. The money is drawn from your account and transferred into the sellers account. Submitting and accepting e-check payments online is referred to as e-check processing.

Mobile Payments: is a process of making payments through a mobile device. Most banks offer an SMS service when making a mobile payment which authorizes it in order to make this method more secure. This payment solution is particularly beneficial to owners of devices such as blackberries and iPhones.

Offline Payment Solutions

An offline payment solution is the exact opposite of an online solution as it does not require the use of the internet to process transactions. Offline payment solutions are a more traditional method of processing transactions, for this reason it is trusted more by some retailers. There are many different methods of processing payments offline and they include;

Bank Wire: is a process of payment which transfers money from one bank account to another. This transaction can be made through a bank account or a cash office. Being one of the fastest methods to transfer money, bank wires have proven to be a very popular and reliable offline payment solution.

Cash Payment: the most common and traditional form of payment. Cash payments allow the transaction between an individual and company to be fast and efficient. Cash payments are often risky in the case that a large amount of money is being dealt with, while retailers and companies who accept cash payments will need monitoring and money handling procedures and precautions in place.

Cheque Payment: is a method which involves a written piece of paper that permits the issuing of funds from your bank account to be transferred to the said individual/company. Cheque payments are still a widely used form of offline payment, and are beneficial as it avoids the need to be carrying large sums of cash around.

Postal Payment: is a type of payment that is available for companies of any size. Often used domestically for accepting offline payments from customers across the country; for example: ordering via a catalogue and delivering goods direct to a customer’s specified location. They are a popular and safe method of processing transactions as they can be tracked and can only be cashed by the intended receiver.

Bank Guarantees: is a contract between an individual and bank assuring that in the event that the investor fails to pay a specific amount, the bank will settle their debt. Bank guarantees are not a form of payment processing however they may be required when making substantial payments. In order to qualify to obtain a bank guarantee, the company may be required to present documents detailing the investment they require it for.

Best Payment Processors to Use to Accept Payment on My Website

Best Payment Processors to Use to Accept Payment on My Website

One key business solution merchant website owners always look for is a dependable payment processor to accept payments for online transactions. To the uninformed, however, payment processing is a perplexing subject. There are many complex issues to start with, specifically with regard to the basics of payment processing, payment gateway configuration, and some aspects of third-party payment processors. Before we get down to the best payment processors, here are some essentials about payment processing itself.

About Payment Gateways

A payment gateway is a third-party company, like a bank, which connects your e-commerce software to your merchant account. This real-time facility allows you to accept credit cards, debit cards, and other forms of online payment. Though not essential, a payment gateway has many benefits, such as:

• You will have a feature that will provide your customers real-time feedback on their payment status, most importantly if the payment card is not accepted for any reason.

• You ride on speed and efficiency. If your business conducts large transactions, then you benefit by speed, efficiency, and significantly lower processing fees.

• You start straightaway. No waiting time is required to start your business. A payment gateway starts accepting debit or credit cards immediately. To summarize, payment gateways accepts information, encrypts it, and transmits it over the web.

Setting Up Gateway Configuration

Setting up your payment gateway essentially consists of two steps.

• The first step involves your merchant account and your gateway provider. You need to provide access to the gateway provider by making available all needed information.

• In the second step, the payment gateway will configure with the payment processor. All that a payment processor will ask you is to log in, proceed to configuration and payment methods, and then select the payment gateway. You may ask whether you can configure different checkout choices. Yes, you can. You can either authorize funds or ask the customer to make real-time payment during actual checkout. Your decision will depend upon your business model. Real-time payment requires that you ship the merchandize within a specified period. In the event you are unable to do so, choosing the other alternative is a better option. The choice of “Authorize Funds” allows you to put a temporary hold on the customers’ funds till you ship your product.

Understanding Third-Party Processors

Simply put, a third-party processor is a vendor who charges your customers’ credit cards on your behalf and then transfers the money electronically to your account. Many online merchants prefer to have both the third-party processor and the payment gateway. This way, you can ensure that your prospective buyer has his or her preferred payment method and is not turned away. Now that you have the basics, we can focus on what features the best payment processors have.

A good payment processor

• Provides merchant account services efficiently. Good customer support is essential. Availability of 24×7 help provides a lot of reassurance that there is someone to troubleshoot your problems.

• Has an effective antifraud solution in place. You hear a lot about credit card frauds going on these days. Credit cards are stolen, lost, or misused by false information. The best payment processors verify billing and shipping addresses with those provided by MasterCard/Visa. In addition, card security codes are put in place to verify that the buyer actually owns the card. • Provides you with accurate financial information.

• Has a recurring billing feature. This simply means automatically collecting payment installments after a fixed duration.

• Have reasonable rates and fees. However, you must remember that each payment processor may have different sets of rates. For example, they may have an assortment of rates, such as discount rates, chargebacks, or transaction rates, in addition to application fees, ongoing fees, and settlement fees. Choosing the best payment processor will entail evaluating all financial aspects of the charges and fees.

• Is dependable in all respects. Any weak link in the payment processing system means loss of customer confidence, and this translates into loss of business. There are many dependable and well-known payment processors out there. All you need to do is evaluate the benefits and disadvantages each processer has.

Some of the well-known names in the business are Google Checkout, PayPal, MiraPay, and Authorize.net, to name a few. They have survived the competition and are thriving because they have built customer trust by providing a dependable, secure, and fast payment environment.

Mobile Payments

Mobile Payments – Collaboration is the Key

In theory, the concept of mobile payments has a strong business case, given the high market penetration rates of mobile devices, such as cellular phones and PDA?s, in many parts of the world. In addition, mobile operators and financial institutions, through the use of these devices, envision an attractive way to enable their customers to make payments. On the consumer side, users can reap the benefits of convenience, permitting them to buy goods and services from any location.

In principle, a mobile device can be used as a POS (point of sale) tool. Mobile operators and financial institutions consider this concept as the next logical step in making mobile devices a trusted payment device for consumers, acting as a payment instrument supplementing cash, cheque, credit card and debit card.

Currently, financial institutions are rolling out wireless POS capabilities to merchants which are in-turn competing with a consumer?s mobile phone. Several new services have been introduced around the world in which merchants are accepting payments from wireless POS terminals. These wireless POS terminals, for example, allow merchants to offer home delivery services in which payments are presented and accepted upon delivery of goods or services at the consumer?s location.

Wireless POS terminals use the wireless networks of mobile operators to send payment instructions to a merchant acquirer?s payment server. Consequently, wireless POS services are classified as an extension of traditional payment services. Given that in some areas of the world almost everyone will soon own a mobile phone, and most merchant locations offer POS terminals as a form of payment, it is at least conceivable that the mobile device will take over a large part of the retail payment market.

Since wireless POS implementations are an extension of current payment infrastructures, users still need to use a credit or debit card to make purchases. The convenience associated with current wireless POS methods have to do with the fact that these terminals are brought to the location of the purchase. For example, in a restaurant environment with the user paying for their bill via debit card from their seat, or for their groceries which have been delivered to their front door.

Mobile devices enable the use of numerous services, services that do not need card readers, personal computers, and modem combinations or a merchant?s wireline POS terminal. Nowadays, mobile devices have an embedded chip that can be used to store information and provide secure authorization and identification.

The Need for Interoperability

But to make these services available to the majority of mobile users, mobile payment service providers need to roll out services that offer interoperability. There have been numerous mobile payment pilots conducted that enable mobile devices to be used as a payment option, some of which have advanced into full mobile payment services (e.g. PayPal, PayBox, MovilPago). To date, we?ve discovered that the key to providing a successful mobile payment service has to do with the benefits it gives the end user and the end user’s customers: convenience, security, and freedom being a few key elements.

Though the industry has a long way to go before mobile devices will become a consumer?s payment instrument of choice, to ensure the stability of a viable mobile payments infrastructure, collaboration is the key.

Both mobile operators and financial institutions have tried, with little success, to implement their own individual pilot projects. Both parties have encountered numerous difficulties. Mobile operators, for example, because of their extensive existing customer base, technical know-how and billing comprehension, seemed the most likely candidates to provide mobile payment services. However, problems associated with risk management and the collaboration of numerous providers needed to accomplish interoperability have arisen. Financial institutions on the other hand are confronted with a limited number of users and high infrastructure costs. To remedy these problems, mobile operators and financial institutions have begun collaborating to jointly offer mobile payment services to their customers. For instance, leading Dutch direct bank ING/Postbank Nederland, has partnered with the Netherlands number three mobile carrier Telfort, to offer users mobile access to the bank?s retail applications and link user bank accounts to Telfort?s prepaid service top-up capabilities for account recharging. In this case, the fact that these two entities are taking advantage of their natural symbiosis is a big step in the right direction.

Right now there are four entities needed to make a payment via credit card (acquirers, issuers, merchants and consumers) to make a payment via mobile device, there are five (mobile operators, acquires, issuer, merchant and consumers). As a result, the ideal business model includes the cooperation between mobile operators, financial institutions, technology suppliers and industry associations to create a certain amount of standardization which will ensure the successful implementation of a strong mobile payments infrastructure.

Still, numerous issues, including limited functionality available through the current generation of networks as well as a lack of standards to name a few, are still hampering the efforts being carried out by these industry players. In addition, questions regarding successful revenue generating business models also remain.

Conclusion

As mentioned earlier, cell phone and PDA penetration rates are higher then they’ve ever been, with forecasted growth rates showing exponential increases in consumer adoption. Accordingly, industry focus should be centered around the business side. Right now it is not feasible for a mobile operator or a financial institution to role out competing services on a proprietary model that does not include interoperability. Mobile operators and financial institutions must work together to implement mobile payment services that marry a consumer?s bank account with their mobile subscription. Offering payment services should not be seen as a competitive advantage, but rather as a necessity which will drive the success of the rollout of mobile commerce.

Today we see several initiatives taking place including the creation of various industry associations designed to address the different issues associated with the mobile industry. With these activities underway-mobile operators and financial institutions are beginning to work together to roll out new payment services. Pre-paid top up, for example, is the first real commercial mobile payment application that is being introduced into several markets. Financial institutions and mobile operators are collaborating to enabling mobile subscribers to electronically pay for their pre-paid wireless accounts using several banking channels such as telephone banking, Internet banking, and ATM and mobile banking, completely automating the ?top-up? experience using SMS (Short Message Service).

Currently, payment instruments are stored in virtual wallets residing either on the mobile device or centralized on the open network service platform. Consumers register for the service through their financial institution, mobile operator or service provider, depending on how the service is setup. The registration is necessary to link the consumer?s subscription data with their financial information and provision the mobile device for the service. Future methods may see users using their mobile device as a way to simply access their bank accounts, whereby the mobile operator?s function will be simply to transport the data. In addition, smart cards issued by financial institutions may begin to become more prevalent.

As mobile services and infrastructures evolve we will begin to see the true notion of mobile payment instruments living up to the hype of ?anytime, anywhere payments.? Soon, mobile payments will become an integral part of consumer lifestyles, replacing the payment instruments we have hidden in our wallets today. It is clear, that the co-operation between mobile operators and financial institutions is needed to build a viable mobile payments offering. It is also clear that the next logical payments industry step is to provide consumers with the ability to make payments for goods and services on their mobile devices. The only true concept of ?anytime anywhere payments? is conceivable through access via a mobile device. ‘Where there’s a wireless, there’s a way’ and the key to the success of the industry is as simple as giving consumers what they want.

Easy Pay, Payment Plans, and Layaway Are Great Options for Families on a Budget

Easy Pay, Payment Plans, and Layaway Are Great Options for Families on a Budget

With holidays and birthdays quickly approaching and a large family, budgeting and saving can be quite a chore. A number of retailers are making it easier and more convenient than ever to get products, gifts, and services with flexible payment options designed for families.

Using credit cards has gotten quite expensive, interest rates constantly fluctuate, and it is very easy to over spend. One of our financial goals was to eliminate our credit card debt and only spend the money that we have. We have been able to stick to this plan pretty well, but sometimes there are larger purchases or events that just require different ways to pay. Let’s explore some additional options that families and individuals have to making shopping and spending more manageable.

Easy Pay or Flex Pay

Easy Pay or Flex Pay is a great way to be able to immediately get items with flexible payments. Usually these payment plans offer 2-month to up to 6-month equal payment options. The unique opportunity that easy pay and flex pay affords is the ability to get your items right away, usually with no interest and only the first payment required.

For Christmas last year, I was able to get a new Canon DSLR camera on easy pay. These cameras can be quite expensive, but with easy pay, we were able to spread the payments out over 5 equal payments through the Home Shopping Network (HSN). Both HSN and QVC offer these payment options and have a large inventory of products for just about any purchase.

For the dad or Barbecue enthusiast in your life, Traeger Grills offers 3 to 5 pay options on their pellet smoker grills. This makes a great gift and I can attest to the amazing food that can be smoked, cooked, grilled, or baked.

Tower Hobbies offers easy pay on a number of its items like, remote control vehicles, hobby and craft items, as well as a number of other items for kids and adults. I have used their easy pay on a number of gifts for the kids and family members.

If you have a musician in the family Sweetwater offers an easy pay option as well. This is great way to purchase guitars, keyboards, drums, or just about any other musical instrument for your budding artist. I have used Sweetwater’s easy pay option in the past to get music instruments and it was definitely easy and convenient.

Both Easy Pay and Flex Pay usually require either a bank account, credit card, or debit card, to setup the equal payment plan. Some, but not all of the retailers also require a credit check in order to be approved for the plan so be aware of this before planning your purchase. Most of the sites have an FAQ for their payment plan that will provide basic information regarding their rules and expectations.

Easy/Flex Pay Advantages:

Get Item Immediately
No Interest
Flexible Payment options usually 2 to 6 payments
Convenient

Easy/Flex Pay Requirements/Disadvantages:

Usually Requires Bank account, Credit Card, or Debit Card
First Payment
Set Monthly Payment
Some may require a Credit Check
Usually will pay closer to Full Retail Price on Items

Layaway

Layaway is making a big comeback in the retail space. Many of the large retailers are finding Layaway a familiar and popular way to provide flexible payment solutions to their customers.

The biggest differences between layaway and Easy/Flex Pay are, with layaway, you make a down payment; this is typically between 10 and 20%. Then you pay as you wish, whatever amount you would like, until the item/items are paid off. There are sometimes caveats though. For instance, some layaway plans require you pay something at least once a month, while most require that items be paid off within a specified time frame.

Some of the major retailers that are offering layaway for holiday shopping in 2013 are Kmart,Walmart, Sears, and Toys R Us. Be sure to check each website to get the rules and requirements for each layaway program.

Many local retailers also provide layaway options for many types of goods. I purchased a high-end road bicycle from a local bicycle shop that allowed me 6 months to pay with a small down payment. Though it didn’t give the immediate gratification that most people crave when making a purchase, it provided a goal and sense of accomplishment that may not have otherwise been realized, which makes layaway a great option to teach kids these lessons.

Furniture and appliances are other great options for layaway. I have purchased a number of these items on layaway over the years. Check with individual stores to see if they offer layaway solutions, it is easy to ask, and you may be surprised at how many local businesses provide this as an option.

Layaway Advantages:

No Interest
Small Down Payment
No set Payment Amount (Pay what you can)

Layaway Requirements/Disadvantages:

No Instant Gratification
Down Payment
Time Limit (Must pay off in x amount of time)
Some retailers only have Layaway during Holidays

Payment Plans

You may be surprised to learn that there are a number of family entertainment options that provide payment plans. Theme parks such as Disney, Six Flags, and others now offer monthly payment options for their season passes.

Considering the cost of the typical day out to one of the theme parks, these season pass payment plans can provide a significant savings and opportunity to visit multiple times throughout the year. We currently have a Six Flags pass and pay approximately $6 per person per month.

Theme parks aren’t the only entertainment options available to families on a budget. Our family loves to camp, but here in California, campsites can run from $30 to $60 per night that can add up quick especially over a long weekend. A number of years ago we signed up with a campground membership through Thousand Trails. For about the cost of one night per month of camping, or roughly $45 per month, we can camp as often as we want at a number of private resort style campgrounds. This has been a great investment; the sites have events for the kids, swimming pools, mini golf, playgrounds and entertainment for the entire family.

Another entertainment payment solution we have found and subscribe to is MoviePass. Being big movie fans, we would often spend a large chunk of our entertainment budget on frequenting the movie theater on date nights. Ticket prices have significantly gone up over the years and most of the time you end up paying $10 to $15 per ticket. With the MoviePass option, we are able to go to an unlimited amount of movies each month for one monthly fee.

Payment Plan Advantages:

Easily Budget Entertainment
Unlimited visits
Affordable Pricing

Payment Plan Requirements/Disadvantages:

Usually Requires Credit or Debit Card
Most have yearlong term
Many Automatically Renew
Not Worth it if you don’t use it

Payment Services

What to Expect From Credit Card Payment Services

We may not be fully immersed in the cashless society, as cash is still around, and it appears that it may not be leaving very soon. It may be entirely possible to manage a business without accepting credit cards, but by doing so, as a business owner, or merchant, you may actually be hurting your prospects for growing your business.

Payment by credit cards is facilitated by the use of credit card payment services. The providers of credit card payments services may sometimes be known as merchant service providers and they supply of all of the physical needs for businesses owners to accept credit card payments, such as merchant accounts and POS terminals. They may also supply many complimentary or associated services in addition to payment accounts.

Credit card payment services will allow vendors and business owners to accept payments online. Online payments are rapidly expanding to include payments from mobile devices, such as tablets and smartphones. Although there may be limits on the value of the purchases, it offers the advantages of rapid payments that may be pre-authorized. This can be a big benefit for business owners, as most of the transactions with be handled by card processors, while the business simply accepts the payments.

Your credit card payment services provider may also provide you with the ability to process payments with debit cards. Debit cards are popular with consumers for the payment of smaller to medium sized purchases. The advantages to consumers, are that it helps with managing cash flow, as `payment is made with funds that have already been obtained, and are no longer expected. Debit cards are another payment option that merchants can increase the volume of sales.

Other payment options that may be offered by your provider, include wireless machines, for mobile vendors, who can accept payments from checks or even debit cards without needing physical wiring. The process is secure and faster that processing over telephone lines.

Although the use of cheques as a payment method is fading quickly, some payment services may also offer check processing software, that can be used to verify the validity of the check. However, the use of check-processing software is now being supplanted by a process that converts a physical check into an electronic check.

The type of payment service that you choose, may depend on the nature of your business, and the type of customers that you serve. Some customers may actually prefer ending payments by check, while others will prefer to use credit or debit cards. As a merchant, you may need to implement multiple payment methods, and the merchant service provider can help with the proper selection.

An evaluation should include an examination of how the payments are received, and examination of the ability of the customers to make payments. It should also include a cost analysis, and a comparison of the different payment methods. The choice should also include a process with some flexibility, that allows for changes, if conditions in the commerce environment changes.