Tech has changed the way alcohol retailers conduct their financial operations. Alcohol retailers have embraced the use of electronic funds transfer to pay distributors while also remaining compliant. Using EFT has also ensured that all payments get processed on the appropriate dates, so alcohol retailers stay compliant with set state and federal regulations. Through the Electronic Funds Transfer Act, the government monitors compliance with EFT payments. The EFTA covers issues like disclosure of customer information, consumer liability, error resolution, and record retention. If you aren't compliant, you may lose your business license or face various fines and penalties.
Using EFT to make payments in the alcohol industry saves you both time and money. You spend less time keying in data and correcting any errors, and drivers don't need to wait for the signing of checks or the creation of money orders. In fact, using EFT can save you an average of 15 minutes on each delivery. You also minimize the risk of robbery since drivers no longer carry cash, which helps reduce insurance costs. Read on for more details.
What Are Electronic Funds Transfer (EFT) Payments?
Electronic funds transfer involves moving money from one account to another electronically. This transfer can be from one bank or across several financial institutions or credit unions. The processes are accomplished via a computer-based system and don't require direct intervention from an employee. You no longer need to rely on the traditional cash collection processes. And electronic funds transfer can encompass different payment types.
Some of the different kinds of EFT payments include:
- Wire transfers
- Direct deposits
- Debit/credit cards
- Electronic checks
- Pay by phone systems
Benefits of Electronic Funds Transfers
Alcoholic retailers are continually adapting electronic funds transfer to enhance their cash flow and operate smoothly in the digital world. Using EFT payments also lets you make instant applications and reconcile your financial records accurately.
Here are more benefits of using electronic solutions to make and receive payments.
Fast payments worldwide
With electronic funds transfer, you don't have to wait long for payment processing since these payments are much faster than traditional methods. EFT payments are typically complete within one to two business days, and can even be instant for same-day payments.
And the location of the parties involved in the transactions doesn't affect the transfer of funds. You can make payments to any place across the globe at any time. You no longer need to go to the physical location of your financial institution to make payments to your alcohol distributors.
Low or no fees, depending on the payment type
The traditional methods of sending money or paying your alcohol distributors through banks meant that you had to incur an extra fee on every transaction. These bank charges add up quickly, creating an expensive form of transaction processing. However, while using most electronic payment systems in your alcohol business, you will not incur such high fees. You only need to pay a fixed fee for a subscription to your provider.
Alcohol retailers can provide a hassle-free payment experience to alcohol distributors with electronic funds transfer systems. One great benefit is that EFT payments help you ensure that you pay your vendors on time, keeping them happy.
In the traditional system, businesses had to employ employees to take care of the various paperwork. Electronic funds transfer reduces and automates much of this admin work by being 100% electronic, making it easier to manage. Moreover, you won't have to spend more money on envelopes, ink, check stock, and other supplies.
Digital records of transactions
When it comes to financial matters, you want to have a full record of all your business’s transactions to ensure all payment processing is complete on time and compliant with federal, state, and local alcohol regulations. At the same time, using a digital medium to make payments makes it easy to maintain transparent records of your transactions. Put simply, with electronic payments, you no longer need to worry about keeping records of your payment details.
Like ATM transactions and Payroll Direct Deposit, EFT payments are safe. In any EFT payment, information gets encrypted with 128-bit SSL and goes through a secure communications channel. Data can't be redirected, read, or tampered with. There are also lesser chances of losing money through fraud.
Embrace Software to Handle Your EFT Payments
Simply put, if you haven't embraced EFT payments systems in your alcohol business, it's time you made the switch. You cut down on paperwork, enhance cash flow, and keep your vendors happy. EFT also ensures that you stay compliant with the federal and state regulations since all your payments get processed on time, every time.
iControl is the only B2B solution that offers simplified alcohol payment processing and scan-based trading, and accurate POS data in the Food and Beverage industry. So retailers who sell beer, wine, and spirits can finally get a solution that’s tailored to their needs, making their payments fast and secure. Get a free demo of our results-driven software.