Don’t rush into any given electronic payment processing technologies for your distribution company. Here are key features to look out for.
Get Paid On Time: How Electronic Payments Are Changing The Game
Here's some things to think about and why taking on electronic payments helps you achieve better clarity in your financial picture.
Electronic payments are game changers in the area of business-to-business dealing. As more established businesses begin to automate their payment processes, these businesses are streamlining these payment processes for more efficient day-to-day business operation. In doing so, such businesses are employing the resources of payment services companies to operate as a middle man between the businesses themselves and the banks with whom they deal.
Why Not Bank The Old-Fashioned Way?
First, there are a number of reasons why old-fashioned banking has remained a primary means of managing payment processes. According to PaymentSource.com, the process of dealing directly with banks when it comes to payment operations maintains an established foothold due to the following:
- Banks are well-known and trusted commodities. This is an example of the adage "if it isn't broken, don't fix it." However, there are those who would argue that the current business payment processing system is broken. PaymentSource.com tells us that "the average cost of processing a business payment from invoice to payable and finally to payment clocks in at $65, and with businesses managing 20 billion checks each year, this analog payment method represents a $1 trillion drag on US businesses." Thus, the current system is antiquated at best.
- Most small businesses already have an established relationship directly with a bank. This makes it difficult for the parties involved to see the value in inviting financial technology companies to initiate themselves as an integral part of this relationship. However, as most procedures in this world become increasingly automated, the business payment process will eventually need to follow suit. SmallBusinessComputing.com quotes Jeff Haden of Inc.com, who is of the opinion that "automation is the only way for small businesses to remain competitive in the future." Haden states that if you aren't willing to take the time to automate now, 'someone else will automate you out of business.' It is evident that the need for automation will catch up with most companies eventually.
- Businesses are often shy about trying new technology because they have a lot at stake, compared to, say, a single consumer. Many business payment processes deal with large amounts of money, and it may seem risky to trust these processes to an automated third party. However, as more and more businesses make the switch to automated payment processing, an increasing number of businesses will see this shift as a viable complement or even alternative to accounting software and bookkeepers. In addition, payments will be processed in a timely manner.
How To Start Automated Payment Processing
Since automated payment processing is a critical trend when it comes to commercial banking, it is important to address some crucial tips for making the game-changing switch to automation. SmallBusinessComputing.com and PaymentSource.com weigh in with some helpful hints, which are summarized below.
- Choose an electronic payments solution that offers a wide variety of services and options from which to choose. Too often, companies provide only the basics when businesses require more complete and elaborate payment processing services.
- Take the time to make the switch. Remember that every company experiences growing pains as part of the maturation process, and automating payment services is a considerable overhaul.
- Develop an in-house automation culture. Explain to employees that although electronic payment systems will eliminate some jobs, they will create others. In addition, hire those who possess automation expertise to help explain this and to assist the transformation in moving forward as smoothly as possible.
- Focus on automation in other areas. This allows the company to run more efficiently in general, and it offers employees the opportunity to experience automation and to become accustomed to automation during their daily work routines.
Thus, as automation establishes itself as the preferred payment method for commercial banking, look to financial technology companies to play a larger role in more businesses' day-to-day environments. Click the link below to see how PayApp by iControl can help you business operate more efficiently.