Bosco Chartered Accountants

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Consumer Payment Solutions

Consumer Payment Solutions

28 February 2019


Consumer Payment Preferences Have Changed – How Does This Affect Your Business?

The days of receiving cash in your pay envelope then using it to pay the bills and make purchases has long faded into the past. Australians have embraced the move towards a cashless society which has lead to the introduction of multiple methods to pay for our purchases from the humble EFTPOS card to payWave and innovative mobile phone payment solutions.

“Buy Now, Pay Later”

“Buy now, pay later services” offered at the checkout (like Afterpay and Zip Co) can make it easier and more attractive for consumers to pay for goods and services but for both retailers and consumers these services have their pros and cons. These services are specialised credit lines in consumer finance that work as an incremental payback system. When we took our cash along to the shop our spending limit was determined by the amount of cash in our pocket. “Buy now, pay later” solutions have the potential to increase the amount a consumer can spend by making it easier for the customer to pay and then budget that payment over a period of time. By feeling more comfortable with their spending the customer is more likely to return and provide positive referrals for your business.

The Flip Side

“Buy now, pay later” solutions can be complex and expensive for retailers to install. The cost of the technology and software must be considered along with the increased merchant fees charged by third party credit providers. These costs must be included in the overall price of the goods or services being sold. So while offering payment solutions to your customers can give you a competitive advantage it can also impact on your businesses ability to compete on price. There is also eligibility criteria to be taken into consideration (gaming and tobacco companies are not allowed to offer this type of payment option). For the consumer, the third party credit provider offers an interest free loan on the condition that the balance is paid back within a certain time. Late fees or interest apply if there is an outstanding balance at the end of this time frame. So what seemed like a great purchase & easy payment at the time can turn out to be more costly than expected.

Offering Payment Solutions to Your Customer

Businesses can potentially gain more revenue by offering more payment solutions. So what payment solutions should you offer your customers and how do you integrate solutions that reduce the risk to both the merchant and consumer?

Many cloud accounting software providers are part of the ‘new wave’ of payment options. 

  • MYOB - facilitates payments through MYOB PayBy. This next generation solution accept payments from Visa, Mastercard, AMEX and BPay. It also uses advanced machine learning to protect merchants from fraudulent transactions.
  • Xero - connecting a payment service directly to your XERO software gives your customers more ways to pay you. A range of payment services seamlessly integrate with Xero, including PayPal, Stripe and GoCardless.
  • Apple Pay - accepting Apple Pay as a payment option when you add Stripe allows customers to pay you securely through their iPhone, iPad, and Apple Watch.
  • QuickBooks Online - can help you get paid in more ways fast with payments partners PayPal and Square.

The new wave of payment solutions and move to cashless transactions can benefit both the small business owner and consumer. When considering the change, plan to provide a positive customer experience and make sure your solution has a strong security and privacy component.

Need help choosing the right payment option for your business? Contact us for more information.


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