Receiving payments from customers and clients is a fundamental part of doing business—no matter what business you’re in, or how small or large your company is. It’s also a part of business that can become mired in minutiae and inefficient processes that not only drive up costs but may also lead to customer dissatisfaction, errors, and delays in reaping the rewards of a current accounts receivable.
The more inefficient these processes, and the more steps and handoffs required, the greater the costs and potential for error. These inefficient payment processes cost you money!
Ineffective Payment Processes Cost You Money
Consider the inefficiencies that are inherent in traditional payment processes:
- Cash payments require a person-to-person interaction that needs receiving money from the customer; often making change (which can be prone to error); and later counting, batching, and depositing the money in the bank. Not to mention the opportunity for theft!
- Check payments require verifying the information on a check, recording it for a deposit, and depositing the checks in the bank. Even though checks can be deposited electronically these days, it’s still a manual process that wastes time and administrative expenses. In addition, these payments can be delayed in many cases as they go through the mail and then sit in your mailroom or on an account clerk’s desk until they can be attended to.
- Even traditional credit card payments, without automation, can be time-consuming and prone to error and fraud. Consider the time and potential error associated with a process where the customer calls in with their card number to make a payment, for instance. Hand entering the card number into the machine and then recording that transaction in your accounting system.
The costs many businesses incur when choosing to keep finances separate from their accounting systems can be substantial.
The solution? Streamlining the B2B payment process with automated credit card processing. Today’s innovative payment solutions can save time and fuel business growth.
Big Benefits From B2B Credit Card Processing
When companies turn manual processes into electronic processes, they reduce transaction and reconciliation time, as well as improve the convenience for their customer. Here we take a look at some of the areas of big benefits in cutting administrative costs that you can realize by selecting the right B2B credit card processing partner.
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Faster Payment Processing
When you accept credit cards, especially when customers and clients can pay electronically, payments can be processed quickly—in near real time. That allows your business to reduce the staff time and effort needed to complete transactions.
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Greater Convenience
We’ve already mentioned some of the convenience you and your staff will realize by cutting administrative costs through credit card payment processing. But your customers will appreciate the added convenience as well. Credit cards are widely accepted for in-person and online transactions, helping to expedite payments—and payment processing.
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Better Cash Flow
The faster and more efficiently you can process payments, the sooner your company will have the advantage of these funds being available for your own expenses and investments. Increased cash flow makes a huge difference to your bottom line.
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Greater Security
Credit card payments are more secure—especially when you take advantage of Level II and III processing, which provides additional details about transactions that go beyond Level I processing (which can be useful for fraud prevention and detection):
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- Level II Security: This includes information about the transaction and customer code to qualify for lower interchange rates.
- Level III Security: This includes customer and transaction information, which provide more complete payment history.
An added benefit: when you use Level II and III processing, you can qualify for greater discounts, meaning reduced processing fees and more money flowing to your bottom line. Make sure your software provider is able to automate the Level II and III processing to keep the transactions simple.
Credit card processing comes with a cost too, and you want that cost to be as low as possible while ensuring you and your customers have a positive, efficient, and safe experience. That cost is known as an “effective rate,” and it’s an important metric to monitor and to stay on top of so you know the total overall cost to your business of accepting credit card payments.
Time really is money for businesses of all types and sizes. Cutting administrative costs in processing credit card payments can boost your bottom line while reaping added benefits like greater accuracy and security and more satisfied employees—and customers!
Moving to an Out-of-the-box Credit Card Payments Solution?
Whether you are considering a specific credit card payment vendor, your bank, or are already using something like QuickBooks Payments, the more information you have to make an informed decision, the better. Now you can access our helpful guide, Conquering Change Anxiety: Migrating From QuickBooks Payments To New B2B Payment Solutions, which dives into all the best practices and considerations you need to know in making these decisions.
Use our guide to learn:
- The limitations of QuickBooks Payments for growing businesses
- Key features to look for in a B2B credit card processing solution
- How to successfully implement a solution and integrate it into your current accounting software
- And more!
