5 Common Payment Processing Challenges Small Businesses Face

Tag: Payment Processing



Small businesses face many unique challenges such as problems related to payment processing. This issue can manifest itself in a variety of ways and thus requires careful intervention. It is crucial that a small business takes proper care of its payment processing system to ensure that there is timely and accurate collection of the payments due. Identification of different problems is one of the most important steps in this process, so here is the list of the top payment processing issues a small business may have to face: 

Data Security: With the increase in instances of cyber attacks and data frauds, it has become essential for a business to protect itself and its clients from such mishaps. An efficient payment processing system should provide robust protection against such data breaches. Any such fraud or leaking of important data can not only negatively impact the revenue and income of a business, it may also put strain on their position in the market. The businesses should ensure that their payment processing system adheres to Payment Card Industry (PCI) Data Security Standard (DSS). Such compliance saves you and your business from liabilities which may arise from data breaches. 

Chargebacks: These expenses are one of the biggest challenges faced by the businesses with regard to their payment processing systems. Chargebacks are also known as processing fees and can form a big chunk of your overall expenses. There are many factors which influence such chargebacks. Some of the main causes which impact the volume of chargebacks are types of payment options, types of cards used and the size of transactions. Different types of businesses may be levied different types of charges. It is important to remain in constant touch with your providers so that you are aware of different chargebacks. Further, you may also try to negotiate the prices down. Such management of charges can have significant impact on your bottom line. 

Compliance and Regulations: As payment processing systems are becoming more complex, the regulatory requirements are also increasing to keep a proper check on them. These regulations are mainly enacted to safeguard all the parties involved in the payment processing cycle. However, these also tend to increase the paperwork. It is important that you comply with all the requirements laid by these regulations so as to ensure that you have proper recourse as and when there is any issue pertaining to such payments. The outlay required for meeting these rules is generally justified by the benefits granted through these regulations. 

Multi Channel Payments: In order to ensure that you are able to serve your clients in the best possible manner, it is important to offer a wide range of payment options. However, it also means that you have to deal with the terms and conditions attached with large number of such outlets. Multiple vendors may increase the complexity of your payment systems which may require increased outlay of resources. It is generally advisable to integrate such option payments so that they can be managed with relative ease. Further, the ability to control these multiple methods may also increase the efficiency of your operations. 

Payment Support and IntegrationAs payment processing is one of the most crucial functions, it is important that the business pays proper attention to this facet. The businesses should endeavor to keep the downtime to the minimal. There should also be proper backup system, so that your clients do not have to face any hardship if there is any breakdown in the services. You should define such terms and conditions with your service provider explicitly. The integration of various modes of payment and processing systems is important for ensuring efficiency. It is also helpful in keeping the costs down. Such integration allows for the installation of a dashboard which helps in centralizing the control measures. 

It is highly recommended to businesses that they pay proper attention to their payment processing systems. They should also be careful while selecting their payment services partners. The main focus should be on managing costs and expanding the portfolio of services offered. It is also important that the system is flexible so that it can accommodate frequent changes in technologies employed.  

How to provide a local flavor to your global ecommerce business

How to provide a local flavor to your global ecommerce business

Think global, act local is the new success mantra for e-commerce players operating internationally.

Localization of one’s global e-commerce business is the best strategy to transcend cultural boundaries and win customers’ trust (and wallet share!). Although e-commerce has wiped away the boundaries of time and place, cultural differences play an important role in customer perception. Often, small changes like localization of language and content can help connect better with the customer. We shall study the ways in which the localization strategy can be effectively implemented:

  1. Speak the same language: One must be aware of the cultural sensitivities of each region before going gung-ho and translating the entire website into the native language. For example, in some regions, an informal address might be acceptable to the customer. In others, a polite and formal tone sends across the message of being business-like and professional. Customers are likely to be impressed with product descriptions in their regional language or websites hosted on country-level domains. Often, there are websites that support multiple languages. One needs to select the country name from a drop down menu and the entire website is customized as per local tastes. However, it is important to note that the meaning should not be lost in translation!
  2. Win at social media: Unless one has been living under a rock, an active social media presence is a must. Effective communication and posts as per regional interests would help easily win potential customers. One should not stick to global platforms like Twitter and Facebook merely. There would be other mediums that would be able to catch the pulse of the local public better.
  3. Reviews by natives: It would be a good idea to include reviews by the natives in the regional website. The readily available peer reviews would convince other customers about the quality of the product. This would result in higher sales conversion.
  4. Utilize local festivals to one’s maximum advantage: This strategy works well in a country like India, where festivals are celebrated on many days in a year. Major e-commerce players like Amazon, Flipkart have successfully adopted this strategy. They offer special discounts for Diwali, Republic Day, Holi etc, which results in phenomenal volume growth in sales. Further, offering customized products with marketing material suited to the occasion can help boost revenues. Thus, one could capitalize on special shopping days by working with local marketing agents to achieve higher sales.
  5. Payment processing in local currency: Customers would prefer to pay in the local currency. Merchants should ensure that the payment gateway supports payment in home currency. Another idea would be to have a flexible shopping cart with a currency converter. The online payment platforms could also offer multilingual support. It would be prudent to have multiple payment options as the preferred and acceptable payment modes vary from region to region.
  6. Familiarity as a branding strategy: Localized content and hosting products that are popular in the target market would help the customer easily navigate the website. Thus, the purchase decision and transaction completion would be faster. A smooth checkout process would ensure repeat customers for further buys.
  7. All-in-one adaptation: One must remember not to restrict localization merely to linguistics or language translation. Localization strategy encompasses the entire gamut of content – text, pictures, currency, delivery channels, brand building, design and cultural alignment. The last would include aspects like avoiding selling products on the e-commerce website that hurt local sentiments. Researching the local market to create a native shopping experience is key to achieving success.
  8. Know the rules: Local regulations on consumer laws and data privacy should be considered before localization of the e-commerce platform. For example, some countries mandate the use of a privacy policy and a disclosure of cookies that store customer information. One must keep in mind the local taxes and other jurisdictional requirements that are to be complied with in the payment gateway process.

Localization of the e-commerce business, operating globally, would allow the message to go across clear to the customer, enabling higher sales conversion, beating competition and reaching out to a wider target audience.

5 Common Myths about Merchant Accounts Processing That Can Lead You Astray

5 Common Myths about Merchant Accounts Processing That Can Lead You Astray

When the matter is about monetary transactions on your e-store, suspicion is always there. After all, you are bestowing someone else with the responsibility of handling your customers’ money. Then there are concerns whether transactions are secured against fraudulent attempts or not?

Various myths regarding merchant accounts processing have been circulating in the merchant community. If you are planning to open a merchant account with a payment solutions company, you should know about the common myths that may negatively influence your decision. Let us take a look at them.

All Payment Processing Operators Are Scammers

There are many credible service providers who provide quality services. Their terms of service will be crystal clear. Moreover, they will not have long-term contracts that will unnecessarily bind the merchant for a long tenure. They will let you know about all type of charges beforehand.

The Biggest Is the Most Trustable

You must have heard about the established online payment platforms that are visible everywhere – in search engine ads, on social media, and in renowned blogs. Even some of your merchant friends must have told you about them. But guess what, the biggest is not always the best. There are other service providers who may offer better services at affordable prices.

The lesser-known merchant account processors are more committed to providing personalized solutions to the merchants. They may have a secure procedure for processing payments, may provide services at the best rates, may have better enterprise-level hardware and software, and may take less time to initialize the setup. So yes, you should be willing to consider payment service providers who haven’t made it big yet.

Processing Charges Are Too High

Most of the times, merchants are not aware of the processing charges. Moreover, they assume them to be very high, based on rumors. But this is not true. Depending on the business turnover, you can decide to opt for payment processing services. If you have a massive turnover, it is advisable to opt for a merchant account with a unique merchant number. If you are a small business merchant, opt for a payment service provider that enrolls you in a shared merchant account setup.

Yes, there are charges associated with merchant account service providers such as termination fees, interchange-plus or flat rates, retail rates, monthly charges, and so on. But if you consider your transaction volume, the charges may not be that much. However, discuss with the service provider before finalizing the contract.

They Are All the Same

No, they are not. There are three types of payment processing companies – merchant account providers, payment service providers, and payment gateway providers. The merchant account provider is basically concerned with providing a merchant account and it may also provide payment processing service with the assistance of a third-party processor. The payment service provider does not offer a dedicated merchant account. Instead, it clubs your business with other businesses on a single merchant account.

The last one, payment gateway providers may either provide both merchant account and payment processing or provide only payment processing service. As you can see, they are not at all the same.

Not Better Than Local Banks

Banks do not offer reliable merchant account services, which are necessary to operate a business seamlessly. They will not provide you with the freedom to collect payments via various means, the hardware and software may not match the industry standards, and there is no reliability when it comes to backend support. Processing charges might be low but services are not always up to the mark.


You should not be guided by myths and rumors. Get hold of the facts before making your decision. This was our attempt to clarify some doubts so that merchants like you can make decisions that are beneficial for their business.

Scaling Your Business with Recurring Billing

Scaling Your Business with Recurring Billing

There is no better news than a fast-expanding customer base for a business owner. However, with the good news comes a new challenge – how to effectively tackle the large number of payments from your growing list of customers.

One of the best ways to do that is to use the recurring billing model. This will not only help you automate and simplify the business model while assuring a fixed revenue stream, it will also help your customers by offering them regular payment options, fewer late fees, greater convenience and faster payment methods.

Let us take a deep-dive into how you can take advantage of the recurring billing system and scale your business.

Benefits of Recurring Billing Model

  1. Pricing as per Service Offerings

Recurring payments generally deal with software-as-a-service (SaaS) offerings. However, there are no predefined norms when it comes to the type of products and services. You can take payments online for a bunch of services, offered in a package. Create suitable packages comprising of products and services, and allow users to purchase subscription packages. The recurring subscription system is a secure payment processor that takes care of all the billing cycles, maintains client records, and ensures encryption of sensitive information like credit card details.

  1. Inter-linked and Automated Process

While installing a recurring payment model, customer acquisition should be a priority. When we talk about customer acquisition, harnessing multiple channels like online, mobile, and affiliates should be considered. The inter-linking of channels and payment mediums depict the seamless functionality of recurring billing software.

Raising invoices, linking payment gateways, managing accounts, scheduling periodic reports, and adapting to changes – a perfect recurring payment system automates all these processes for a simplified functioning. Scaling your business becomes easier as you can focus on other peripherals other than billing.

  1. Enhanced Customer Relationship

Do you know that the probability of selling to a new customer is 5-20% whereas it fluctuates between 60-70% for an existing customer? When you have a subscription model in place, you should ensure customer satisfaction. Furnishing facilities like automated payments, usage metrics, timely notifications and updates, and prompt support services are necessary to develop fruitful customer relationship. Moreover, the recurring billing model can assist you with subscription chores like renewals, terminations, customization, upgrades, and so on.

  1. Accurate Analysis & Growth Prediction

Data is the key to your success. As subscription services are constantly evolving, you should be agile enough to adapt to the latest methodologies. Data metrics and customer behavior analysis play a crucial role in determining your next move. An efficient recurring system will emphasize data metrics such as retention rate, subscription patterns, customer acquisition, cost analysis, and much more. This will ensure a stable cash flow and growth in your business.

Integrate Recurring Billing Software

There are various online payment platforms that offer reliable and scalable recurring billing system, along with various payment features. Considering the aforementioned benefits and your requirements, you can integrate a payment gateway on your website. Most of the payment gateways, like PayTabs, offer hassle-free solutions for collecting recurring payments.

You can expect complete or partial automation, as per your convenience. From generating periodic invoices to upgrading subscription plans, the payment gateway takes care of all the aspects. In addition to automation, customization is also an influencing factor. There is a wide scope of customization involved such as designing invoice and email templates, updating subscription packages, setting up notification alerts, and much more.

Payments can get complex in a recurring model. For example, if a credit card expires and the payment is due, there could be a possible decline. Generally, recurring payment software is capable of managing card details and client information, thus, reducing the possibility of declines at the time of payment. And since the recurring model deals with a client’s personal information, it is advisable to rely on secure online payment systems that vouch for encrypted payment processes.

There is no doubt that recurring billing system assists you in scaling your business. At the same time, we cannot rule out the possibility of complex mechanisms, which may hamper your business growth. An automated and reliable recurring payment system lets you focus on other organizational aspects, without compromising sales and customer relationships.

Five Payment Processing Challenges For Small Businesses

Five Payment Processing Challenges For Small Businesses

The payment industry today seems to be thriving with each passing day. While there is nothing more enjoyable than making money from your business, collecting money seems to be a totally different game. Unlike in the past, people now have no qualms about making payments online. More and more people, especially the current generation prefer using online modes of payments and like to go cashless. With an easier than ever acceptance of credit and debit cards, online payment has become much more sorted and simple, but it does come with its own set of challenges. If you run a small business, payment processing can get a little bit confusing and demanding. To prepare you for the worst, here are five biggest payment processing challenges that you are likely to face:

  1. Frauds

Well, who has not heard of credit card frauds?  Those still remain the biggest reason for most customers to opt for cash on delivery. They have been in existence since a long time and pose a threat to not just customers but to business entities as well. While advancement in technology has made online payment easier, it has also given birth to new types of frauds. Hence businesses need to be proactive about keeping the information of their clients secure. It is also important that as a business owner, you complete the audit of your processor. This can be done by hiring an audit expert who can evaluate your current security measures and warn you against possible vulnerabilities.

  1. Chargebacks

Chargebacks are one of the biggest challenges faced by business owners. Also known as processing fee, its amount depends on various factors like type of business, types of card used, and modes of payment and size of transactions. It is important that you remain in constant liaison with your provider and discuss how each fee works. There are ways to negotiate or avoid a few charges. So it is advised that business owners stay informed.

  1. Payment support

The world is always up, round the clock, so transaction issues are also expected to pop up anytime – even in the middle of night. It is important to have a payment processor support in after-hours too. If your provider refuses to offer that, you may want to rethink about sticking to your current provider. The processor should not leave you or your customers hanging and should always be ready to troubleshoot any problems that arise.  Having access to tutorials and video how to-s is a bonus.

  1. Payment integration

Payment processing is one of the most crucial components of any business. This seems like a common knowledge, yet, many businesses do not pay enough attention to the importance of an effective payment system. The technology available to collect payments is quite complex and needs to be given careful consideration. That is not all, even when your payment processing is successfully integrated, the cost can go up very significantly, especially for small businesses wanting to accept payments online. It is suggested by experts that business owners look for payment integration providers that have built an API suitable for your business.

  1. Compliance

There are a myriad of compliance issues that can appear for businesses in the online payment landscape. Technology certifications and challenges like PCI are just a couple of them. Needless to mention, the regulatory requirements can sometimes get extremely overwhelming for a small business entity as a non-compliance with any of legal regulations can lead to hefty fines and penalties. This makes it all the more important for business owners to work with a processor who can help you stay up to date with legal norms and regulations for your business type.

It is not only imperative, but mandatory that as a business owner you look for a processor that offers a broad set of solutions and products along with best in class support system that fits well with payment processing needs of your business.