January 31, 2023 Blog

5 Major Payment Processing Challenges For Small Businesses That Can Be Avoided

By Fida-E Zaheer, Read 6 mins

Running a small business, especially if you are a budding entrepreneur or hustling with it along a 9-5 job, consumes your time and mental and physical energy. 

While a long list of challenges pops up daily, managing your finances – the cash flow is the real deal.

If the cash flow impedes, a wide array of problems arise – your employees might not get paid on time, you might miss on supplier’s payment deadlines, and ultimately your business will lack liquidity for capital investments. And, you know, none of this is good. 

For healthy business growth and revenue, it is crucial to streamline easy payment processing methods such as credit cards. Nonetheless, some common payment processing challenges for small businesses can occur.

Major Payment Processing Challenges & Solutions

The good news is there are ways to deal with them.

To empower you to promote business efficiency and productivity, let us look at these challenges and what you can do to handle them.

1. Breach of Security & Payment Fraud

The Challenge:

When you switch to online payment methods – as much as they bring in benefits and ease of use- you must be prepared and cautious of breaches of payment data security.

If client shops and makes a payment online, their complete credit card information are stored over the internet if they are not careful or there is no security system by the seller.

From information theft to clean fraud, identity theft, triangulation (fake sellers may steal buyer’s card information and misuse it), and friendly fraud, you must be prepared for all of it as a business owner.

If your client’s information gets into the wrong hands or your company’s payment data is under cyber-attack, you can lose your reputation, revenue, and business.

The Solution:

Worry not because there is always a way out.

The easiest way to prevent any security breach is to put a system in place. When you initiate credit card processing, ensure that the services adhere to compliance with PCI (payment card security) – DSS (data security standard). It will encrypt the user’s card information as a token that only an authorized entity can decrypt.

Moreover, to prevent any payment fraud, you can install a fraud detection extension to detect fraud the moment it occurs. With all these measures, you can build customer trust, reduce shopping cart abandonment, and ensure a safe payment processing system.

2. Problem with Integration

The Challenge:

To ensure seamless payment processing, it is important that your payment platforms seamlessly integrate into your existing software. With a fully integrated system, your operations have no friction, and the data can be upgraded without any hassle. Moreover, it saves time, cost, and effort.

When there is no integration, you or your employees will have to perform tedious and frustrating administrative tasks – all the records for the transaction will need to be generated, managed, and updated manually into the books. Not only is it a waste of time, but you can put information at risk, data can be copied, and resources are wasted.

If this keeps happening, your small business will be in jeopardy, and success growth will only remain a dream. 

Moreover, we do not want that to happen,

The Solution:

You can solve this problem now by transitioning your payment processing system into an integrated platform. When you do this, all the transaction records can be updated in real-time, that too automatically – the success of hassle-free payment processing is only a “click” away.

This will also empower you and your employees to eliminate mundane tasks and focus energy on more critical tasks and business needs.

3. Various Multi-Channel Payments

As a business owner, your highest priority is to ensure a seamless and convenient buyer journey. The biggest challenge comes with payment– every customer wants a channel they can use. You need to provide everything from on-site debit or credit cards to online e-wallets. Because if you do not, there will be many abandoned carts, and customer retention will be negatively impacted.

The problem is integrating multiple channels for payment also multiplies the cost and logistic procedures by many folds. Imagine if you have to handle several payment channels just because you deal with different vendors – managing the setup or maintenance costs would be a disaster.

The time, cost, and effort needed for business growth will burn out handling the different payment channels unless you smartly tackle this challenge.

The Solution:

To keep your clients happy and your business stress-free, the easiest way out of this problem is to use an integrated form of multi-channel payment processing. You can easily unify all your payment platform that provides a simple, speedy, and hassle-free payment processing experience – one-platform-fits-all-payments is what you need!

4. Hefty Processing Costs

It will not do your business any good if a large portion of your revenue or profit goes to the payment processing companies. It is essential to manage your turnover.

It would be best to keep operational costs low to ensure long-term profitable margins. You require online payment methods to survive in this digital era of business, but you cannot pay high processing costs.

This is why it is crucial to find an intersection – an alternative for payment platform providers that offer the same efficiency and productivity but at better costs.

But how can you do that?

Here is how.

The Solution:

You can start by comparing different credit card companies to avoid hidden charges and high processing costs. Doing this allows you to analyze the difference and evaluate which platform offers the best payment processing costs that align with your business and client’s needs.

5. Payment Support Issues

Imagine that your business’s payment processor fails to operate after working hours – how will the customers find support, or how will you handle it if you run into any outages after business hours?

That will be an issue – and a big one!

In today’s era, when online work is the new norm, businesses and consumers are no longer bound by the 9-5 timeline. They can now work, shop, and make payments anytime, anywhere they want.

Therefore, if your business wants to survive in this digital climate, it needs to be at par with round-the-clock payment processing support and efficient uptime. Moreover, if the payments are delayed or unprocessed, it will restrain your business’s cash flow and lead to a bad customer experience.

The Solution:

If your payment processing platforms lack this support, you must look for another reliable and efficient solution. It will ensure that your business and customers support each other and can handle any unpredictable encounter easily. 

Ensure that the payment processing is backed by support and integration to prevent any problems for your small business.

The Final Word

Every business starts small. But, when you acknowledge the payment processing challenges in the beginning and take measures to avoid them, you do not only start small, but you start smart!

Make sure your payment processing platform is well-integrated, offers continuous support, is safe for the users, has minimal processing costs, and can handle multi-channel payments. If it all checks your list – you are good to go.

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