Junk status forcing SA businesses to relook operating and payment systems
Thomas Pays, CEO and co-founder of i-Pay - a trusted online payment gateway for both buyers and merchants that allows instant EFT payments - says, that in difficult economic times, businesses should be investigating ways to boost sales and profits, and, one such way, is by offering innovative, cost-effective and simple fintech payment solutions for customers.
“A healthy cash flow is critical to a business’ success and survival, and, in South Africa’s current business landscape, the collection of payment needs to be simplified to be most effective.
“For example, a company processing R1 million a month in payments may pay 3% to a credit card company to manage these payments. However by using an alternative payment solution, such as electronic funds transfer (EFT), companies can negotiate more competitive servicing fees, and potentially pay only 1,5% in fees, as an example. This lower fee would enable the business to potentially save R15 000 per month, which, over a year, amounts to a saving of R180 000. This is a significant sum of money which can be utilised more effectively to drive business growth.”
Pays adds that apart from the potential cost-savings, such a payment solution can also offer a more streamlined and easy way for customers and clients to pay a company, and in turn for businesses to manage payment reconciliation.
“While traditional methods, such as credit card payments, remain popular, these payment methods aren’t always suited to today’s continually-evolving customer. In the digital age, individuals demand ease and accessibly and, subsequently, fintech payment methods have been developed to address this need, and businesses should not shy away from them as a result.”
By making use of an alternative payment solution, such as EFT – which sends requests for payments via SMS, QR Code or push notifications – Pays says that businesses can maximise sales and shorten payment timelines. He point’s to i-Pay’s solution as an example of how it fast tracks payments.
“From a small and medium enterprise (SME) perspective, i-Pay enables business owners to SMS their clients the i-Pay link in store when they want to transact, the client then opens the link via the phone’s browser (no app required), logs into the highly secured gateway with their banking details, approves the transaction and is on their way.
“While for vendors, a link or QR code can be included in an invoice, enabling clients to pay directly, quickly and easily once received. In both instances, the payer doesn’t have to set up the company as a beneficiary, thereby making the call-to-action – namely payment – that much stronger.”
Pays adds that another benefit is the automation in reconciliation once a payment has been done. “Merchants and business will have a fully automated reconciliation from i-Pay to their bank account and ERP/accounting software. This not only eliminates possible human error elements with payment reconciliation, but also enables merchants and/or businesses to save both time and money when allocating resources towards this task.”
In the current economic environment which requires businesses to focus on saving, allowing payment processes and their reconciliation processes to become fully automated within a business is a key innovation. “Not only will clients be more inclined to pay, but businesses don’t have to waste additional resources on following up with late payments,” concludes Pays.