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Chargeback Management

How Payment Gateways Can Help

Explore the role of payment gateways in chargeback management to build better customer trust and protect your business revenue.

The digital shift is today’s reality, more vividly in the payment industry. Digital transactions are super convenient and have changed the face of payments. But it also has its share of challenges.

Some of the common challenges include safety and security issues, technical challenges, geographical limitations, payment processing downtime, and chargebacks.

While they all affect your business’s finances and cashflow, one of the most challenging ones to handle are disputes and chargebacks. If a business sells to global markets and manages records manually, they can potentially end up spending hours on the audit process and still lose the case.

In this blog, we give you a quick recap of what chargebacks are, common chargeback reason codes and how payment gateways like PayBy can help you prevent them.

What are chargebacks?

When a customer disagrees with a charge and disputes the transaction, it leads to what is called a chargeback. A successful chargeback reverses a payment and sends the amount back to the customer’s account.

But in addition to the reversal, the issuing bank or credit card issuer levies a fee on the merchant and the payment gateways.

This results in merchants experiencing revenue losses and paying additional fees, which affects their bottom line. A high chargeback rate can also lead to revoked payment processing privileges.

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It is important to note that a chargeback is not similar to a refund. In a refund, the merchant voluntarily disburses funds for whatever reason. However, chargebacks are initiated by customers mostly via the issuing bank.

Here are the steps for how a chargeback is processed:

  • Dispute initiation - a customer connects with the issuing bank to dispute a transaction for a reason. The issuing bank, in partnership with the acquiring bank, lodges the dispute and processes it. Money is debited from the merchant’s account and credited back to the customer’s account. The payment gateway notifies the merchant of the transaction, following which the merchant can take action.
  • Merchant response - when notified, the merchant launches an investigation into the dispute. The merchant can choose to accept the chargeback or counter the dispute by submitting evidence to prove the request is invalid.
  • Issuer's decision - when the merchant counters the dispute to claim the request is invalid, a dispute resolution process is initiated. The issuing bank reviews all submitted documents to make a decision.
  • Potential outcomes - if the evidence is legit, the merchant wins the chargeback and the funds. Otherwise, the dispute and the chargeback are lost.

In this process, payment gateways play the role of notifying the merchants about the issuing bank initiating the chargeback. They also help with processing, managing and mitigating chargebacks in the future.

What are chargeback reason codes?

Issuing banks, while processing a chargeback transaction, issue an alphanumeric charge code. The purpose of the charge code is to inform the merchant of the reason behind the chargeback request. These reason codes are unique to card networks such as Visa, Mastercard, Botim, and more. Payment gateways may launch their own set of reason codes too.

These alphanumeric codes are carefully structured to educate the merchant about the underlying reason for the dispute. Some codes are alphabetic, like “DP”, illustrating the initials of the reason “Duplicate Processing”. While some are a combination of letters that explain the dispute group and numbers that point out the exact reason. For example - F14, where “F” is fraud and “14” is the reason.

Though the reason code system in chargeback management might differ, the categorization is more or less similar:

  • Processing errors
  • Authorization errors
  • Fraud
  • Customer disputes
  • Miscellaneous
  • Not classified

How payment gateways help manage chargebacks 

Chargebacks are not just merchant liability; they cost payment gateways a fee too. For company financials as well as better partnerships, payment gateways can help merchants with chargeback management.

Payment gateways assist merchants with better tools, features, accessibility, fraud detection, and management processes to resolve chargebacks. Some payment service providers go the extra mile to work with issuing banks for better merchant account status management. Here are some of the assistance from payment service providers:

Fraud prevention tools

Payment service providers maximize machine learning (ML) and artificial intelligence (AI) usage. These technologies have the power to detect and stop fraudulent activities. They can also pick up patterns of possible fraudulent activities and take the correct measures to cut them off.

Furthermore, the service providers deploy strict safety features such as multi-factor authentication (MFA) to authenticate users, card verification value (CVV) or card security code (CSC) to increase security, advance verification services (AVS) to compare and verify billing addresses, and more.

Dispute resolution features

Payment gateways provide guidance and support to resolve debit as well as credit card disputes. They offer an established process for dispute resolution that merchants can plug in and deploy. Besides being equipped with the process, they also provide real-time access to any data, documentation support, transaction records, communication channels, and evidence-gathering support.

They may also offer educational materials that walk merchants through best dispute resolution practices, strategies, compliance information, and more.

Automation

Some payment solutions can help merchants automate many mundane chargeback management steps. They help the company set up an automated chargeback alert to generate real-time triggers every time a customer requests a chargeback. Such prompt notifications leave enough time and room for merchants to chart a course of action in their favor.

Risk analysis

The chargeback resolution process is complex, time-consuming, and labor-intensive. It only makes sense to counter a chargeback and go through the entire resolution process when the odds are in your favor. Some payment providers can help you with just that.

They offer risk analysis based on all the data and documents. You can generate a detailed report of your winning or losing chances, or at least get a percentage win score. You can then analyze it to decide whether to fight a chargeback or accept it.

How can merchants prevent chargebacks with payment gateway assistance?

Spare yourself and your employees the hassle of chargeback resolution and strategize its prevention. Here’s what you can do:

  • Communicate clearly - practice clarity in communications. Communicate the terms and conditions of your product or service, features, pros and cons, agreements, policies, and more to your customers in an easy-to-understand manner. Eliminating misconceptions can reduce chargeback requests to a great extent.
  • Prioritize safety - choose the payment gateways that provide a high level of safety and security. You, your business, and your clients are in dire need of this. A couple of the safety measures you can follow are encrypting customer data for safe storage and following authentication practices like requesting multiple-factor authentication or CVV codes. AVS (Address Verification System) is another safety measure where billing addresses are cross-checked for verification.
  • Be thorough - have thorough steps in place to verify a transactor and the status of the transaction. Always confirm if the product was delivered, its delivery time, and receiver. As the merchant, you also need to have a thorough billing process. Display the charges and a breakdown in detail. Also, include any additional charges as and when they are levied.
  • Improve customer service - gaps in customer service often lead to chargebacks. You must provide your customer support team with everything they need to resolve customer queries proactively. You can also educate your customers to seek help from your helpline numbers before disputing a chargeback because it is faster.
  • Do follow-ups - you must monitor your chargeback rate and constantly try to improve it. You can always get started with your existing customers. Collect feedback from them to identify the shortcomings, if any, and ultimately correct your chargeback rate.
  • Keep records - maintain a database of your customers as well as chargebacks. In this way, you will have access to any documents you might need as proof, for research and analysis, and more.
  • Implement Security - you can use your payment gateway’s fraud detection tool to keep malicious activities in check. These tools not only detect and stop existing types of fraud attempts but also analyze data to find emerging patterns.

Lastly, be aware and informed at all times. Know your industry regulations, legal obligations, limitations, best practices, and more to make the best decision for your company. Build processes tailored to the unique needs of your company.

If you are on the lookout for a payment gateway that offers chargeback management assistance, PayBy can help you. We offer end-to-end chargeback management and also shield your business from false chargeback requests.

Get started today and manage chargebacks efficiently with PayBy.

Gautham Gopakumaran
|
5 min read
May 20, 2024
|
Payment Gateway, Chargeback

Everything You Need to Know About Payment Gateway Reconciliation (2024)

Gautham Gopakumaran
|
5 min read
May 13, 2024
|
Payment Gateway, Payment Reconciliation

Payment gateway reconciliation keeps financial discrepancies away at the speed of transactions happening. However, it is often overlooked and the context is mistaken to be too heavy when clearly it is not.

In this blog, learn what it is, how it works and reasons why doing it manually is not a good idea for your business.

What is payment gateway reconciliation? 

Payment gateway reconciliation involves analyzing payment gateway information and bank balances for matching and identifying any discrepancies. It ensures there are no gaps between both books and if there are it immediately provides you with all the accurate information.

How does payment gateway reconciliation work? 

Here’s are the steps payment gateway reconciliation includes: 

  • Transaction Recording: When a customer makes a payment through your website or other channels, the transaction details are recorded in your payment gateway. This includes information about the transaction amount, date, payment method, and customer details.
  • Bank Deposits: Funds from these transactions get deposited into your merchant account or bank account after the defined settlement period.
  • Reconciliation: The transactions recorded in your payment gateway are compared with the corresponding deposits in your bank account.
  • Identifying Discrepancies: These could include missing transactions, duplicate transactions, or errors in transaction amounts.
  • Resolution: This typically involves contacting the payment processor or bank to investigate further, correcting any errors in the accounting records, or taking other necessary actions to ensure accurate financial reporting.

Why is payment gateway reconciliation important? 

Here are some reasons why payment gateway reconciliation is so important for your business.

1. Accuracy in financial reporting

With payment gateway reconciliation, both internal and external processes of financing are scrutinized. It helps to ensure that all the financial transactions are accurately recorded and processed. It also helps in compliance with all banking and accounting standards and regulations.

2. Fraud detection and prevention

Reconciliation involves matching the internal records with actual transactions to identify any discrepancies including unauthorized charges, and duplicate transactions. It also helps in preventing any fraudulent activities by keeping a constant check on financial transactions.

4. Improved decision-making

Accurate tracks of financial transactions with every important detail help businesses to remain informed and make strategic decisions about budgeting, forecasting, and resource allocation. This clear understanding allows you to be more confident about your financial decisions.

5. Compliance and auditing

Payment gateway reconciliation ensures compliance and facilitates auditing processes by accurately tracking financial transactions, maintaining transparency, and adhering to regulatory standards. This helps businesses avoid legal issues and financial penalties while ensuring trust and credibility with stakeholders.

6. Customer satisfaction

When transactions are processed accurately and efficiently, customers experience fewer issues such as overcharging, double billing, or payment failures. This reliability in payment processing builds trust and loyalty among customers, enhancing their overall experience with the business.

7. Cash flow management 

By reconciling payments with bank deposits, businesses can track their cash flow more effectively. This allows them to monitor incoming funds, identify any delays or discrepancies, and make informed decisions to manage operational and growth finances.

What are the common challenges of payment reconciliation? 

Some common challenges in manual payment gateway reconciliation process are:

1. Volume of transactions and manual errors 

A high number of transactions challenges the accuracy of the manual payment reconciliation process. It is also time-consuming and there is no guarantee of human errors while transaction matching. This can result in incorrect financial entries affecting financial reporting and decision-making negatively.

2. Complexity of transactions and processes

Financial accounting includes several complex transactions such as:

  • Partial payments
  • Refunds
  • Chargebacks, or 
  • Split payments

These can be challenging for manual payment reconciliation as keeping a record and matching these transactions require careful attention to detail.

Also, the reconciliation process in itself if done manually is pretty time-consuming, and the added complexity will only make it more difficult.

3. Timing differences

When a transaction is made and actually processed in a bank account is delayed or done in different timezones, it is a challenge. The manual recordkeeper has to go to an extent to identify the reason for discrepancies happening due to timing differences.

4. Bank reconciliation

The reconciliation process requires all complex banking factors beyond simple credit and debit transactions. It needs to cover factors such as outstanding checks, deposits in transit, bank fees, and interest charges. Ensuring that the bank balance matches the book balance requires thorough examination and adjustment of discrepancies.

5. Resource constraints

Taking care of such a detailed process of book and bank balance matching and ensuring compliance requires a great deal of effort and resources. If done manually, you need to devout the right time & budget and excel in experience.

6. Regulatory compliance

Businesses need to adhere to regulations such as the Payment Card Industry Data Security Standard (PCI DSS) and the General Data Protection Regulation (GDPR). Compliance with standards laid by these regulations is important in every situation otherwise leading to severe penalties and reputational damage. Manually, it is very difficult to keep track of all their standards for every financial operation as businesses need to

  • Stay updated with the latest regulatory changes
  • Conduct regular audits
  • Implement necessary security measures

7. Legacy Systems and fraud detection

Legacy systems lack interoperability or automation capabilities, making payment reconciliation processes inefficient and error-prone. Integrating data from disparate systems and maintaining compatibility with modern tools can be challenging for businesses.

In addition to the same, most legacy systems lack fraud detection capabilities. Their inability to identify suspicious patterns or anomalies in transaction data requires continuous monitoring and analysis, which can be overwhelming to handle.

Consequences of inaccurate reconciliation 

Here are the consequences you must know you can face with inaccurate reconciliation.

1. Financial loss

One of the direct consequences of an inaccurate reconciliation is financial loss. When doing reconciliation manually, you tend to make mistakes such as missing or duplicate transactions, incorrect amounts, or unauthorized charges. It can result in the gap between actual and reported revenue leading to financial discrepancies.

2. Cash flow problems

Inaccurate financial reporting will lead to false information of balance. This may result in cash shortages or delays impacting the business's ability to operate smoothly. It will completely impact your financial planning, leading you to make bad decisions.

3. Compliance issues

Accounting integration reconciliation takes care of compliance with industry standards, and inefficient reconciliation will lead to severe penalties and reputational damage.

4. Fraud and security risks

Inaccurate financial reconciliation can leave you and your business vulnerable to fraud and security breaches. Failure to identify any fraudulent activity in the bank and book balance can lead to great financial losses.

5. Operational disruptions 

Without accurate financial data, businesses can struggle to effectively manage their resources, plan for the future, and make informed business decisions. This could impact both the resources and the skills they need to keep the business running.

6. Reputation damage 

Customers quickly lose trust in the business if they experience billing errors or discrepancies, which can lead to negative reviews, complaints, and loss of business. This can damage the business's reputation among customers, suppliers, investors, and other stakeholders that play a part in their growth.

7. Audit failures

Auditors typically rely on accurate financial records to assess the business's financial health and compliance with regulations. Inaccurate reconciliation can raise red flags and even lead to penalties.

Recommended read: A Guide to Online Payment Security For Business Owners

Why should you use automated payment reconciliation methods? 

Understand why you should use an automated payment getaway reconciliation method with reasons including

1. Time efficiency and accuracy

Automated reconciliation processes and analysis of large amounts of transactional data in no time allow businesses to reduce time and effort. It also uses algorithms and advanced technology to ensure the accuracy of the results is uncompromised.

2. Real-time insights 

Automated reconciliation tools provide you with real-time insights about your transactions. These insights help businesses to:

  • Identify trends
  • Optimize cash flow management 
  • Financial analysis and forecasting 

3. Cost-efficient and scalable

Automation reduces the need for resources required for manual efforts. It allows you to analyze and match bank and book balances with accurate insights without the need for the team. Automated reconciliation systems can also adapt to changing business needs. It is scalable enough to accommodate fluctuations in financial reporting.

4. Easy compliance and fraud detection

With automation, there is no need to keep a close eye on all rules. It helps businesses to maintain compliance in the background. It ensures compliance with all updated industry standards and regulations.

Automated error reconciliation also prevents fraud as early as possible by identifying suspicious patterns in financial transactions. This enables you to get plenty of time to act upon it and save from further damage.

Recommended read: How AI is transforming fraud detection in payments

5. Improved Customer Experience

Automated reconciliation processes can also enhance the customer experience by reducing billing errors, discrepancies, and delays in processing payments.

Customers benefit from smoother transactions and more accurate billing, leading to increased satisfaction and loyalty.

Recommended read: How to improve payment processing user experience

Simplify payment gateway reconciliation with PayBy

Payment gateway reconciliation can be a very overwhelming process to handle when done manually. This is where using a payment solution like PayBy comes into play.

PayBy enables business growth by easing cashless payments for customers with powerful payment gateway reconciliation features.

Get started to know more.

The Future of Biometric Authentication in Payment Systems

Gautham Gopakumaran
|
5 min read
April 29, 2024
|
Payment security

Backtracking a few years, we could never imagine biometric authentication as a thing of today, as we are in it today. We can still evidently remember being in awe the first time our eye scans were used and the rest is history.

Fast forward to today; we do not just have PIN codes and patterns to access devices, we also use fingerprints, facial features, voice recognition, and so on. While there is still a lot to discover about biometric authentication, especially for the payments industry, the feature is all set to redefine security, convenience, accessibility, and the overall customer experience.

Let us walk you through what the future holds for biometric authentication in the payments industry and how business owners can benefit from it.

What is Biometric Authentication?

Biometric characteristics are unique physical or biological aspects of a person. These unique characteristics are recorded and used to identify people transacting via digital mediums.

Just like how people can access a device based on their unique physical characteristics, it is also used as a point-of-sale in the payments industry. Biometric authentication in payments refers to a security step used to verify a payment transaction. It detects and approves the physical characteristics of a user to authenticate or process deductions.

One of the most common mediums used in the payments industry is a fingerprint. Users can go cashless or even cardless, and make a payment using a fingerprint. There are multiple other mediums, such as the retina, signature, voice, face, and so on.

Biometric authentication in payments sits at the intersection of security and convenience. Hence, it is widely opted for and loved. This is why business owners such as you must be aware of its progress and future.

Applications of Biometric Authentication in Payments

Let’s walk through the types of biometric authentications used during a payment. Here are all the possible applications for payment solutions:

Fingerprint Scanning

Fingerprints are unique to individuals and easy to detect and use. Payment providers and users prefer this method over all the others because of its ease and security. So much so that five in six (87%) consumers use or plan to use this medium.

Hence, payment gateways and apps such as Google Pay have widely adopted it to authorize payments. Users can choose to either enter their PIN to gain access to the app or, alternatively, go for a fingerprint.

Facial Recognition

This technology uses the facial features of a person to authenticate a financial transaction. This feature is the second most popular option around the country. One great example is facial recognition-enabled shopping at Carrefour. Shoppers can make payments simply by smiling at the payment counter’s camera.

Alternatively, this technology can be used for online payments as well. Users can check out their purchase using facial recognition via their mobile phone’s camera. Security comes along with convenience because facial features are indeed another unique human trait.

Voice Recognition

Similar to facial recognition technology, voice recognition works on the vocals of an individual. This technology can identify vocal characteristics unique to individuals and facilitate a transaction.

Though not as common as fingerprint and facial recognition, voice-enabled payments are on the rise. Users can read out a command or passphrase to authenticate payments in mobile wallets, banking apps, smart speakers, and more.

Iris Recognition

This technology scans a person’s eye to read unique patterns in the iris, i.e., the colored part of the eye. This technology also uses cameras at checkout counters or mobile devices to scan an eye and authenticate payments.

They are a perfect fit for payment services used in high-security areas like airports, government services, health care services, and more. Because this technology helps fight identity theft, it is deployed in places with security concerns.

Behavioral Biometrics

Another mode of biometric authentication is behavioral patterns. Not everyone has the same movements, the same rhythm of doing things, or the same use cases and interactions with digital mediums.

Payment gateways can detect such behaviors as typing speed, mouse usage, or how the user has interacted with the mobile’s display to identify the right personnel. This technology has the potential to be a widespread medium that works without extra user input. Say hello to the most frictionless payment experience.

Palm Vein Authentication

This technology captures the unique vein patterns on a user’s palm for authentication. This technology is used in places where physical contact is dangerous, such as healthcare facilities.

Plus, the palm vein is considered a better alternative to a fingerprint. Fingerprints are affected by age, disease, skin state, and more, but not palm veins, which remain the same from childhood.

Heartbeat Authentication

This technology is not deployed or put to use currently since it is still in the trial phase. This technology is built to identify and verify the unique patterns of a person’s heartbeat. The progress is gigantic and has the potential to be yet another safe, secure, and contactless biometric authentication mode.

Multi-Modal Biometrics

Not just biometric technology, but AI technology for dubious transactions is also evolving. Hence, multiple biometric modes can be used to enhance security and 2x authentication accuracy.

Activating multiple modes, say fingerprint and facial recognition or iris and voice recognition together would guarantee high security levels. Results? happy customers and accurate payment processing.

Tokenization with Biometric

Storing biometric data has another limitation: theft. Just like sensitive card information can be replaced with a digital identifier called a token for storage, biometric data can be replaced with a cryptographic token.

They are generally an alternative to a user’s identity and can be stored and used for authentication purposes. This leads to better privacy and security for the user’s data.

Advantages of Biometrics in Payments

But, with all the existing authentication mediums, why should you choose biometrics in payments? Here are some of the benefits of biometrics in payments:

  • Enhanced Security - biometric features are hard to replicate because they are unique to every user. Passwords can be the same, PINs can be the same, but not biometric features.
  • Reduced Fraud - biometric authentication is an extra layer of security. The one that scammers cannot pass through. Scammers cannot act like other users or steal their unique biological traits.
  • Convenience - carrying cash or cards is not really a thing with biometric authentication. Users can initiate and complete payments without even monitoring passwords. They can just use any biometric mode and make a purchase, maximizing convenience and experience.
  • Frictionless Transactions - biometric authentication is seamless and easy as opposed to entering passwords during checkout, hence reducing friction. Multiple taps and steps are replaced with just one activity, such as displaying a palm/fingerprint, eye, or face. Super easy, isn’t it?
  • Reduction in Identity Theft - Scammers can steal card identities, but not the unique biological features of humans. It is very difficult for fraudsters to pass, say, a user's fingerprint or facial recognition.
  • Improved User Experience - with reduced friction, users can enjoy an improved and seamless payment experience. The combination of convenience, ease, and security that biometric authentication offers enhances user experience.
  • Lower Operational Costs - an initial investment is required for this technology, but it reduces operational costs in the long run. There are no other costs associated with this technology.
  • Compliance with Regulations - this technology is compliant with country regulations. If you guarantee data privacy for your users, you may use their biometric data to facilitate payments.
  • Future-Proofing - the benefits we see are just the beginning of this technology. It is evolving with a high adoption rate across the payments industry. This is a plan for the long run.

Challenges of Biometrics in Payments

Nothing exists without cons, and here are the challenges facing biometric usage in payments.

  • Privacy Concerns - biometric data is private, and there can be user concerns or resistance to companies storing their biological or physical details.
  • Security Risks - there are some security risks associated. Spoofing is the process of fooling authentication technology with fake artefacts.
  • Accuracy and Reliability - storage of biometric quality has a direct impact on accuracy. When not done right, it can also reject a genuine user, creating friction.
  • Interoperability - information exchange between different systems is a grave threat to privacy.
  • User Acceptance and Adoption - not everyone is comfortable with using their biometric identity to make payments.
  • Regulatory Compliance - biometrics is a user’s private data at the end of the day. It has to be handled with care, or there can be legal implications.
  • Cost and Complexity - the technology is not widespread and comes with extra requirements like cameras and detectors; hence, gets pricey. Plus, it is often pretty complex to integrate and deploy.
  • Single Point of Failure - if the authentication fails, the entire transaction will fail as well, creating user friction. Additionally, when compromised, there is no alternative access for users.
  • Ethical and Societal Implications - biometrics are physical traits and hence might have ethical and societal implications.

Biometric authentication will change the face of payments. It is all set to offer increased security, efficiency, and convenience. But there’s more to this technology than we have already experienced. It is in the evolution phase right now as companies assess its pros and cons.

The future of biometric authentication in payments, however, is bright.

How AI is Transforming Fraud Detection in Payments

Gautham Gopakumaran
|
5 min read
April 22, 2024
|
Payment security, Artificial Intelligence

Cashless is the new currency of the country and a fully cashless society is soon to be a reality.

Predictions are that the UAE will become fully cashless by 2030.

While digital payments are clearly convenient, there are some cons consumers and businesses both need to be wary about - especially, frauds and scams.

Over 50% increase in fraud reports for the year just proves the intensity. It gives us all the reasons why it is important to implement robust fraud detection in payment. And that’s where you can call AI or Artificial Intelligence to the rescue.

The machine learning algorithms, predictive analytics, natural language processing, and other capabilities that AI brings do not just solve the efficiency, accuracy, and user experience challenges, but also help identify malicious activities.

This article will walk you through the transformation of AI in fraud detection.

Challenges of Fraud Detection

Advancement is everywhere. While your payment systems have evolved, so have the fraud techniques become sophisticated.

Here’s the thing with the traditional fraud detection systems, they are built to work on fixed patterns and rules. They are rigid with the capability to identify just the existing trends. This is why your current detection system might fail to determine the onset of new fraud trends.

Secondly, such a system reports anything that goes beyond the fixed rules. Result? False alarms. It also blocks genuine customers out and reports them leading to business loss. This is why your business needs a system that can adapt to evolving business needs and AI in fraud detection comes into play.

How is AI Used for Fraud Detection

Artificial Intelligence uses a set of machine learning algorithms with the capability to analyze and identify abnormal behaviors or patterns. The first step in the process is - learning the normal behaviors and what’s considered standard user behaviors while making payments. For the next steps, this technology scans through all the data to find any behaviors that are off the track. It doesn’t end here, where the traditional fraud detection systems do, i.e. detect and report anything abnormal.

AI now takes a step ahead of the curve to analyze this new pattern or new behavior to understand the intention behind it. It has the capacity to alter its parameters to make sense of the new detection and understand if it is genuine or suspicious.

Based on the hypothesis, it takes immediate action by either blocking the transactions or giving access to them.

Here are some of the common AI mechanisms:

  • Data collection
  • Model training
  • Alerting and reporting
  • Feature engineering and detection
  • Self-learning

Benefits of AI for Fraud Detection

Now’s the right time to be a step ahead and safeguard your business from online threats. Learn about the benefits of machine learning and AI for fraud detection:

Enhanced Accuracy

AI algorithms are taught to pick recurring fraud instances or patterns that might miss the human eye. This meticulous scanning and detection function contributes to enhanced detection and accuracy. AI can scan through heaps of data and pick up malicious activities in no time.

Real-time Results

AI algorithms work on a real-time basis. They have the power to block suspicious activity as and when it occurs, cutting off any negative implications immediately. This keeps businesses safe from threats in all capacities.

Reduced Manual Workload

Employees would no longer spend time on manual fraud detection, monitoring, or analytics. This gives them a lot of time to focus on innovative and strategic activities to grow your business. Save your employees some time and give your business some innovative wings.

Self-learning Capacity

The technology is built to think like humans. This means it is on the quest to improve its knowledge, and the more data it gathers, the more it learns. The technology keeps growing, making better analyses and predictions. Plus, the AI systems of the world also exchange knowledge among themselves. Hence, better predictions are always evident.

Easy to Scale

No data is too much data for AI models. They have the capacity to go through tons of data, and they can do it in seconds if not milliseconds. This is extremely helpful when businesses grow. They can enjoy high accuracy and speed without having to upgrade their AI-deployed fraud detection system.

Highly Cost Effective

While there are some initial investments connected with deploying AI in fraud detection, they are cost-effective in the long run. They automate a lot of fraud detection and rectification processes and also eliminate mundane manual tasks. Not to forget, they stop fraud which can otherwise lead to heavy monetary losses. Plus, there are no additional costs during scaling.

Customer Satisfaction

Security is given with AI in fraud detection which increases customer trust and retention. Additionally, traditional limitations such as false positives are put at bay. This increases customer satisfaction and business revenue. With these benefits, business owners can enjoy a competitive advantage and massive business gains.

Common Frauds That AI Can Detect

There is no stopping new fraud scams from emerging. But, here are some of the common AI frauds you are highly likely to encounter:

Card Fraud

Scammers do not sit down to find cards with loopholes or weak security. They leverage bots to find these gaps and detect them at large to conduct a brute-force attack on payment gateways. They are extremely common and because they are done using bots, AI has the power to detect them.

AI goes beyond just reading IPs and the IP reputation of a source and into the behavior to detect what’s a bot and a real person. Based on the analysis, AI takes immediate action to block any malicious bots. CAPTCHA is another form of AI technique used to distinguish people from bots.

Fake Account Creation

The biggest prey to fake account creation is social media. There are just so many accounts creating havoc at large, and it is a bot art. They can create tons of accounts at a go to skew your, say, product reviews, spread misleading information, create malware, and more.

Heightened sign-up security is the solution you say, incorrect! Increasing the standard sign-up security process would only increase user friction, leading to an increased user drop-off rate. AI however can detect and catch bots and fraudsters from the existing signup flow.

Account Takeover (ATO)

Fraudsters cannot just create fake accounts, they can also take over your existing business accounts. This can put a strain on your business reputation and financial health.

You sure can deploy a multi-factor authentication but its effectiveness relies on users too. It doesn’t work for the ones who don’t toggle it. AI, on the other hand, has what it takes to detect the tiny clues that scream of attempted ATO, and immediately block it.

Credential Stuffing

Another method of attempted scams is credential stuffing. Well, scamsters use bots to find and fill in common usernames and passwords to crack access. They even leverage previously stolen data to detect reused passwords of users to gain access and steal.

AI is always on the lookout for accounts with multiple login failures or other such abnormal behaviors. It can find, report, and block such attempted credential stuffing breaches.

Where is AI Headed 

AI and machine learning for fraud will continue to evolve forever. This makes us confident that it can preserve your business’s security. These systems are trained to think like humans and analyze all data points like customer behaviors, device functionality, and more besides the mainstream financial data.

The result? Detection accuracy and it will just get better.

Regarding what the future holds, AI models can be trained to adapt to any possible future onsets. They will continue to be the driving security force for your business and your customers, acting as the shield of protection. We cannot emphasize their ability to self-learn and act on a real-time basis enough, which is an asset for business owners such as you. You must leverage AI in fraud detection for your payment infrastructure and reap security benefits.

Ending on this note, if you use AI for bank fraud prevention, you cannot just protect your customers from fraud but also enhance their experience transacting with you. Yes, it provides smarter detection, hypothesis, and resolution in real time. But it can also analyze customer behavior and data points that can help you make critical product enhancements and innovations.

It’s time to provide your customers with a frictionless and safe payment experience without the workload. And PayBy is here for you.

We leverage AI-based fraud monitoring, 3D secure authentication, and transaction risk analysis to provide the utmost safety. Get started with Payby to know more.

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Chargeback Management

How Payment Gateways Can Help
Explore the role of payment gateways in chargeback management to build better customer trust and protect your business revenue.

The digital shift is today’s reality, more vividly in the payment industry. Digital transactions are super convenient and have changed the face of payments. But it also has its share of challenges.

Some of the common challenges include safety and security issues, technical challenges, geographical limitations, payment processing downtime, and chargebacks.

While they all affect your business’s finances and cashflow, one of the most challenging ones to handle are disputes and chargebacks. If a business sells to global markets and manages records manually, they can potentially end up spending hours on the audit process and still lose the case.

In this blog, we give you a quick recap of what chargebacks are, common chargeback reason codes and how payment gateways like PayBy can help you prevent them.

What are chargebacks?

When a customer disagrees with a charge and disputes the transaction, it leads to what is called a chargeback. A successful chargeback reverses a payment and sends the amount back to the customer’s account.

But in addition to the reversal, the issuing bank or credit card issuer levies a fee on the merchant and the payment gateways.

This results in merchants experiencing revenue losses and paying additional fees, which affects their bottom line. A high chargeback rate can also lead to revoked payment processing privileges.

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It is important to note that a chargeback is not similar to a refund. In a refund, the merchant voluntarily disburses funds for whatever reason. However, chargebacks are initiated by customers mostly via the issuing bank.

Here are the steps for how a chargeback is processed:

  • Dispute initiation - a customer connects with the issuing bank to dispute a transaction for a reason. The issuing bank, in partnership with the acquiring bank, lodges the dispute and processes it. Money is debited from the merchant’s account and credited back to the customer’s account. The payment gateway notifies the merchant of the transaction, following which the merchant can take action.
  • Merchant response - when notified, the merchant launches an investigation into the dispute. The merchant can choose to accept the chargeback or counter the dispute by submitting evidence to prove the request is invalid.
  • Issuer's decision - when the merchant counters the dispute to claim the request is invalid, a dispute resolution process is initiated. The issuing bank reviews all submitted documents to make a decision.
  • Potential outcomes - if the evidence is legit, the merchant wins the chargeback and the funds. Otherwise, the dispute and the chargeback are lost.

In this process, payment gateways play the role of notifying the merchants about the issuing bank initiating the chargeback. They also help with processing, managing and mitigating chargebacks in the future.

What are chargeback reason codes?

Issuing banks, while processing a chargeback transaction, issue an alphanumeric charge code. The purpose of the charge code is to inform the merchant of the reason behind the chargeback request. These reason codes are unique to card networks such as Visa, Mastercard, Botim, and more. Payment gateways may launch their own set of reason codes too.

These alphanumeric codes are carefully structured to educate the merchant about the underlying reason for the dispute. Some codes are alphabetic, like “DP”, illustrating the initials of the reason “Duplicate Processing”. While some are a combination of letters that explain the dispute group and numbers that point out the exact reason. For example - F14, where “F” is fraud and “14” is the reason.

Though the reason code system in chargeback management might differ, the categorization is more or less similar:

  • Processing errors
  • Authorization errors
  • Fraud
  • Customer disputes
  • Miscellaneous
  • Not classified

How payment gateways help manage chargebacks 

Chargebacks are not just merchant liability; they cost payment gateways a fee too. For company financials as well as better partnerships, payment gateways can help merchants with chargeback management.

Payment gateways assist merchants with better tools, features, accessibility, fraud detection, and management processes to resolve chargebacks. Some payment service providers go the extra mile to work with issuing banks for better merchant account status management. Here are some of the assistance from payment service providers:

Fraud prevention tools

Payment service providers maximize machine learning (ML) and artificial intelligence (AI) usage. These technologies have the power to detect and stop fraudulent activities. They can also pick up patterns of possible fraudulent activities and take the correct measures to cut them off.

Furthermore, the service providers deploy strict safety features such as multi-factor authentication (MFA) to authenticate users, card verification value (CVV) or card security code (CSC) to increase security, advance verification services (AVS) to compare and verify billing addresses, and more.

Dispute resolution features

Payment gateways provide guidance and support to resolve debit as well as credit card disputes. They offer an established process for dispute resolution that merchants can plug in and deploy. Besides being equipped with the process, they also provide real-time access to any data, documentation support, transaction records, communication channels, and evidence-gathering support.

They may also offer educational materials that walk merchants through best dispute resolution practices, strategies, compliance information, and more.

Automation

Some payment solutions can help merchants automate many mundane chargeback management steps. They help the company set up an automated chargeback alert to generate real-time triggers every time a customer requests a chargeback. Such prompt notifications leave enough time and room for merchants to chart a course of action in their favor.

Risk analysis

The chargeback resolution process is complex, time-consuming, and labor-intensive. It only makes sense to counter a chargeback and go through the entire resolution process when the odds are in your favor. Some payment providers can help you with just that.

They offer risk analysis based on all the data and documents. You can generate a detailed report of your winning or losing chances, or at least get a percentage win score. You can then analyze it to decide whether to fight a chargeback or accept it.

How can merchants prevent chargebacks with payment gateway assistance?

Spare yourself and your employees the hassle of chargeback resolution and strategize its prevention. Here’s what you can do:

  • Communicate clearly - practice clarity in communications. Communicate the terms and conditions of your product or service, features, pros and cons, agreements, policies, and more to your customers in an easy-to-understand manner. Eliminating misconceptions can reduce chargeback requests to a great extent.
  • Prioritize safety - choose the payment gateways that provide a high level of safety and security. You, your business, and your clients are in dire need of this. A couple of the safety measures you can follow are encrypting customer data for safe storage and following authentication practices like requesting multiple-factor authentication or CVV codes. AVS (Address Verification System) is another safety measure where billing addresses are cross-checked for verification.
  • Be thorough - have thorough steps in place to verify a transactor and the status of the transaction. Always confirm if the product was delivered, its delivery time, and receiver. As the merchant, you also need to have a thorough billing process. Display the charges and a breakdown in detail. Also, include any additional charges as and when they are levied.
  • Improve customer service - gaps in customer service often lead to chargebacks. You must provide your customer support team with everything they need to resolve customer queries proactively. You can also educate your customers to seek help from your helpline numbers before disputing a chargeback because it is faster.
  • Do follow-ups - you must monitor your chargeback rate and constantly try to improve it. You can always get started with your existing customers. Collect feedback from them to identify the shortcomings, if any, and ultimately correct your chargeback rate.
  • Keep records - maintain a database of your customers as well as chargebacks. In this way, you will have access to any documents you might need as proof, for research and analysis, and more.
  • Implement Security - you can use your payment gateway’s fraud detection tool to keep malicious activities in check. These tools not only detect and stop existing types of fraud attempts but also analyze data to find emerging patterns.

Lastly, be aware and informed at all times. Know your industry regulations, legal obligations, limitations, best practices, and more to make the best decision for your company. Build processes tailored to the unique needs of your company.

If you are on the lookout for a payment gateway that offers chargeback management assistance, PayBy can help you. We offer end-to-end chargeback management and also shield your business from false chargeback requests.

Get started today and manage chargebacks efficiently with PayBy.

Gautham Gopakumaran
|
5 min read
May 20, 2024
|
Payment Gateway, Chargeback

Everything You Need to Know About Payment Gateway Reconciliation (2024)

Master Payment Gateway Reconciliation: Expert insights, tips, and best practices for seamless financial accuracy.

Payment gateway reconciliation keeps financial discrepancies away at the speed of transactions happening. However, it is often overlooked and the context is mistaken to be too heavy when clearly it is not.

In this blog, learn what it is, how it works and reasons why doing it manually is not a good idea for your business.

What is payment gateway reconciliation? 

Payment gateway reconciliation involves analyzing payment gateway information and bank balances for matching and identifying any discrepancies. It ensures there are no gaps between both books and if there are it immediately provides you with all the accurate information.

How does payment gateway reconciliation work? 

Here’s are the steps payment gateway reconciliation includes: 

  • Transaction Recording: When a customer makes a payment through your website or other channels, the transaction details are recorded in your payment gateway. This includes information about the transaction amount, date, payment method, and customer details.
  • Bank Deposits: Funds from these transactions get deposited into your merchant account or bank account after the defined settlement period.
  • Reconciliation: The transactions recorded in your payment gateway are compared with the corresponding deposits in your bank account.
  • Identifying Discrepancies: These could include missing transactions, duplicate transactions, or errors in transaction amounts.
  • Resolution: This typically involves contacting the payment processor or bank to investigate further, correcting any errors in the accounting records, or taking other necessary actions to ensure accurate financial reporting.

Why is payment gateway reconciliation important? 

Here are some reasons why payment gateway reconciliation is so important for your business.

1. Accuracy in financial reporting

With payment gateway reconciliation, both internal and external processes of financing are scrutinized. It helps to ensure that all the financial transactions are accurately recorded and processed. It also helps in compliance with all banking and accounting standards and regulations.

2. Fraud detection and prevention

Reconciliation involves matching the internal records with actual transactions to identify any discrepancies including unauthorized charges, and duplicate transactions. It also helps in preventing any fraudulent activities by keeping a constant check on financial transactions.

4. Improved decision-making

Accurate tracks of financial transactions with every important detail help businesses to remain informed and make strategic decisions about budgeting, forecasting, and resource allocation. This clear understanding allows you to be more confident about your financial decisions.

5. Compliance and auditing

Payment gateway reconciliation ensures compliance and facilitates auditing processes by accurately tracking financial transactions, maintaining transparency, and adhering to regulatory standards. This helps businesses avoid legal issues and financial penalties while ensuring trust and credibility with stakeholders.

6. Customer satisfaction

When transactions are processed accurately and efficiently, customers experience fewer issues such as overcharging, double billing, or payment failures. This reliability in payment processing builds trust and loyalty among customers, enhancing their overall experience with the business.

7. Cash flow management 

By reconciling payments with bank deposits, businesses can track their cash flow more effectively. This allows them to monitor incoming funds, identify any delays or discrepancies, and make informed decisions to manage operational and growth finances.

What are the common challenges of payment reconciliation? 

Some common challenges in manual payment gateway reconciliation process are:

1. Volume of transactions and manual errors 

A high number of transactions challenges the accuracy of the manual payment reconciliation process. It is also time-consuming and there is no guarantee of human errors while transaction matching. This can result in incorrect financial entries affecting financial reporting and decision-making negatively.

2. Complexity of transactions and processes

Financial accounting includes several complex transactions such as:

  • Partial payments
  • Refunds
  • Chargebacks, or 
  • Split payments

These can be challenging for manual payment reconciliation as keeping a record and matching these transactions require careful attention to detail.

Also, the reconciliation process in itself if done manually is pretty time-consuming, and the added complexity will only make it more difficult.

3. Timing differences

When a transaction is made and actually processed in a bank account is delayed or done in different timezones, it is a challenge. The manual recordkeeper has to go to an extent to identify the reason for discrepancies happening due to timing differences.

4. Bank reconciliation

The reconciliation process requires all complex banking factors beyond simple credit and debit transactions. It needs to cover factors such as outstanding checks, deposits in transit, bank fees, and interest charges. Ensuring that the bank balance matches the book balance requires thorough examination and adjustment of discrepancies.

5. Resource constraints

Taking care of such a detailed process of book and bank balance matching and ensuring compliance requires a great deal of effort and resources. If done manually, you need to devout the right time & budget and excel in experience.

6. Regulatory compliance

Businesses need to adhere to regulations such as the Payment Card Industry Data Security Standard (PCI DSS) and the General Data Protection Regulation (GDPR). Compliance with standards laid by these regulations is important in every situation otherwise leading to severe penalties and reputational damage. Manually, it is very difficult to keep track of all their standards for every financial operation as businesses need to

  • Stay updated with the latest regulatory changes
  • Conduct regular audits
  • Implement necessary security measures

7. Legacy Systems and fraud detection

Legacy systems lack interoperability or automation capabilities, making payment reconciliation processes inefficient and error-prone. Integrating data from disparate systems and maintaining compatibility with modern tools can be challenging for businesses.

In addition to the same, most legacy systems lack fraud detection capabilities. Their inability to identify suspicious patterns or anomalies in transaction data requires continuous monitoring and analysis, which can be overwhelming to handle.

Consequences of inaccurate reconciliation 

Here are the consequences you must know you can face with inaccurate reconciliation.

1. Financial loss

One of the direct consequences of an inaccurate reconciliation is financial loss. When doing reconciliation manually, you tend to make mistakes such as missing or duplicate transactions, incorrect amounts, or unauthorized charges. It can result in the gap between actual and reported revenue leading to financial discrepancies.

2. Cash flow problems

Inaccurate financial reporting will lead to false information of balance. This may result in cash shortages or delays impacting the business's ability to operate smoothly. It will completely impact your financial planning, leading you to make bad decisions.

3. Compliance issues

Accounting integration reconciliation takes care of compliance with industry standards, and inefficient reconciliation will lead to severe penalties and reputational damage.

4. Fraud and security risks

Inaccurate financial reconciliation can leave you and your business vulnerable to fraud and security breaches. Failure to identify any fraudulent activity in the bank and book balance can lead to great financial losses.

5. Operational disruptions 

Without accurate financial data, businesses can struggle to effectively manage their resources, plan for the future, and make informed business decisions. This could impact both the resources and the skills they need to keep the business running.

6. Reputation damage 

Customers quickly lose trust in the business if they experience billing errors or discrepancies, which can lead to negative reviews, complaints, and loss of business. This can damage the business's reputation among customers, suppliers, investors, and other stakeholders that play a part in their growth.

7. Audit failures

Auditors typically rely on accurate financial records to assess the business's financial health and compliance with regulations. Inaccurate reconciliation can raise red flags and even lead to penalties.

Recommended read: A Guide to Online Payment Security For Business Owners

Why should you use automated payment reconciliation methods? 

Understand why you should use an automated payment getaway reconciliation method with reasons including

1. Time efficiency and accuracy

Automated reconciliation processes and analysis of large amounts of transactional data in no time allow businesses to reduce time and effort. It also uses algorithms and advanced technology to ensure the accuracy of the results is uncompromised.

2. Real-time insights 

Automated reconciliation tools provide you with real-time insights about your transactions. These insights help businesses to:

  • Identify trends
  • Optimize cash flow management 
  • Financial analysis and forecasting 

3. Cost-efficient and scalable

Automation reduces the need for resources required for manual efforts. It allows you to analyze and match bank and book balances with accurate insights without the need for the team. Automated reconciliation systems can also adapt to changing business needs. It is scalable enough to accommodate fluctuations in financial reporting.

4. Easy compliance and fraud detection

With automation, there is no need to keep a close eye on all rules. It helps businesses to maintain compliance in the background. It ensures compliance with all updated industry standards and regulations.

Automated error reconciliation also prevents fraud as early as possible by identifying suspicious patterns in financial transactions. This enables you to get plenty of time to act upon it and save from further damage.

Recommended read: How AI is transforming fraud detection in payments

5. Improved Customer Experience

Automated reconciliation processes can also enhance the customer experience by reducing billing errors, discrepancies, and delays in processing payments.

Customers benefit from smoother transactions and more accurate billing, leading to increased satisfaction and loyalty.

Recommended read: How to improve payment processing user experience

Simplify payment gateway reconciliation with PayBy

Payment gateway reconciliation can be a very overwhelming process to handle when done manually. This is where using a payment solution like PayBy comes into play.

PayBy enables business growth by easing cashless payments for customers with powerful payment gateway reconciliation features.

Get started to know more.

Gautham Gopakumaran
|
5 min read
May 13, 2024
|
Payment Gateway, Payment Reconciliation

The Future of Biometric Authentication in Payment Systems

Learn how biometric authentication has changed the way customers make payments and what’s in it for the future.

Backtracking a few years, we could never imagine biometric authentication as a thing of today, as we are in it today. We can still evidently remember being in awe the first time our eye scans were used and the rest is history.

Fast forward to today; we do not just have PIN codes and patterns to access devices, we also use fingerprints, facial features, voice recognition, and so on. While there is still a lot to discover about biometric authentication, especially for the payments industry, the feature is all set to redefine security, convenience, accessibility, and the overall customer experience.

Let us walk you through what the future holds for biometric authentication in the payments industry and how business owners can benefit from it.

What is Biometric Authentication?

Biometric characteristics are unique physical or biological aspects of a person. These unique characteristics are recorded and used to identify people transacting via digital mediums.

Just like how people can access a device based on their unique physical characteristics, it is also used as a point-of-sale in the payments industry. Biometric authentication in payments refers to a security step used to verify a payment transaction. It detects and approves the physical characteristics of a user to authenticate or process deductions.

One of the most common mediums used in the payments industry is a fingerprint. Users can go cashless or even cardless, and make a payment using a fingerprint. There are multiple other mediums, such as the retina, signature, voice, face, and so on.

Biometric authentication in payments sits at the intersection of security and convenience. Hence, it is widely opted for and loved. This is why business owners such as you must be aware of its progress and future.

Applications of Biometric Authentication in Payments

Let’s walk through the types of biometric authentications used during a payment. Here are all the possible applications for payment solutions:

Fingerprint Scanning

Fingerprints are unique to individuals and easy to detect and use. Payment providers and users prefer this method over all the others because of its ease and security. So much so that five in six (87%) consumers use or plan to use this medium.

Hence, payment gateways and apps such as Google Pay have widely adopted it to authorize payments. Users can choose to either enter their PIN to gain access to the app or, alternatively, go for a fingerprint.

Facial Recognition

This technology uses the facial features of a person to authenticate a financial transaction. This feature is the second most popular option around the country. One great example is facial recognition-enabled shopping at Carrefour. Shoppers can make payments simply by smiling at the payment counter’s camera.

Alternatively, this technology can be used for online payments as well. Users can check out their purchase using facial recognition via their mobile phone’s camera. Security comes along with convenience because facial features are indeed another unique human trait.

Voice Recognition

Similar to facial recognition technology, voice recognition works on the vocals of an individual. This technology can identify vocal characteristics unique to individuals and facilitate a transaction.

Though not as common as fingerprint and facial recognition, voice-enabled payments are on the rise. Users can read out a command or passphrase to authenticate payments in mobile wallets, banking apps, smart speakers, and more.

Iris Recognition

This technology scans a person’s eye to read unique patterns in the iris, i.e., the colored part of the eye. This technology also uses cameras at checkout counters or mobile devices to scan an eye and authenticate payments.

They are a perfect fit for payment services used in high-security areas like airports, government services, health care services, and more. Because this technology helps fight identity theft, it is deployed in places with security concerns.

Behavioral Biometrics

Another mode of biometric authentication is behavioral patterns. Not everyone has the same movements, the same rhythm of doing things, or the same use cases and interactions with digital mediums.

Payment gateways can detect such behaviors as typing speed, mouse usage, or how the user has interacted with the mobile’s display to identify the right personnel. This technology has the potential to be a widespread medium that works without extra user input. Say hello to the most frictionless payment experience.

Palm Vein Authentication

This technology captures the unique vein patterns on a user’s palm for authentication. This technology is used in places where physical contact is dangerous, such as healthcare facilities.

Plus, the palm vein is considered a better alternative to a fingerprint. Fingerprints are affected by age, disease, skin state, and more, but not palm veins, which remain the same from childhood.

Heartbeat Authentication

This technology is not deployed or put to use currently since it is still in the trial phase. This technology is built to identify and verify the unique patterns of a person’s heartbeat. The progress is gigantic and has the potential to be yet another safe, secure, and contactless biometric authentication mode.

Multi-Modal Biometrics

Not just biometric technology, but AI technology for dubious transactions is also evolving. Hence, multiple biometric modes can be used to enhance security and 2x authentication accuracy.

Activating multiple modes, say fingerprint and facial recognition or iris and voice recognition together would guarantee high security levels. Results? happy customers and accurate payment processing.

Tokenization with Biometric

Storing biometric data has another limitation: theft. Just like sensitive card information can be replaced with a digital identifier called a token for storage, biometric data can be replaced with a cryptographic token.

They are generally an alternative to a user’s identity and can be stored and used for authentication purposes. This leads to better privacy and security for the user’s data.

Advantages of Biometrics in Payments

But, with all the existing authentication mediums, why should you choose biometrics in payments? Here are some of the benefits of biometrics in payments:

  • Enhanced Security - biometric features are hard to replicate because they are unique to every user. Passwords can be the same, PINs can be the same, but not biometric features.
  • Reduced Fraud - biometric authentication is an extra layer of security. The one that scammers cannot pass through. Scammers cannot act like other users or steal their unique biological traits.
  • Convenience - carrying cash or cards is not really a thing with biometric authentication. Users can initiate and complete payments without even monitoring passwords. They can just use any biometric mode and make a purchase, maximizing convenience and experience.
  • Frictionless Transactions - biometric authentication is seamless and easy as opposed to entering passwords during checkout, hence reducing friction. Multiple taps and steps are replaced with just one activity, such as displaying a palm/fingerprint, eye, or face. Super easy, isn’t it?
  • Reduction in Identity Theft - Scammers can steal card identities, but not the unique biological features of humans. It is very difficult for fraudsters to pass, say, a user's fingerprint or facial recognition.
  • Improved User Experience - with reduced friction, users can enjoy an improved and seamless payment experience. The combination of convenience, ease, and security that biometric authentication offers enhances user experience.
  • Lower Operational Costs - an initial investment is required for this technology, but it reduces operational costs in the long run. There are no other costs associated with this technology.
  • Compliance with Regulations - this technology is compliant with country regulations. If you guarantee data privacy for your users, you may use their biometric data to facilitate payments.
  • Future-Proofing - the benefits we see are just the beginning of this technology. It is evolving with a high adoption rate across the payments industry. This is a plan for the long run.

Challenges of Biometrics in Payments

Nothing exists without cons, and here are the challenges facing biometric usage in payments.

  • Privacy Concerns - biometric data is private, and there can be user concerns or resistance to companies storing their biological or physical details.
  • Security Risks - there are some security risks associated. Spoofing is the process of fooling authentication technology with fake artefacts.
  • Accuracy and Reliability - storage of biometric quality has a direct impact on accuracy. When not done right, it can also reject a genuine user, creating friction.
  • Interoperability - information exchange between different systems is a grave threat to privacy.
  • User Acceptance and Adoption - not everyone is comfortable with using their biometric identity to make payments.
  • Regulatory Compliance - biometrics is a user’s private data at the end of the day. It has to be handled with care, or there can be legal implications.
  • Cost and Complexity - the technology is not widespread and comes with extra requirements like cameras and detectors; hence, gets pricey. Plus, it is often pretty complex to integrate and deploy.
  • Single Point of Failure - if the authentication fails, the entire transaction will fail as well, creating user friction. Additionally, when compromised, there is no alternative access for users.
  • Ethical and Societal Implications - biometrics are physical traits and hence might have ethical and societal implications.

Biometric authentication will change the face of payments. It is all set to offer increased security, efficiency, and convenience. But there’s more to this technology than we have already experienced. It is in the evolution phase right now as companies assess its pros and cons.

The future of biometric authentication in payments, however, is bright.

Gautham Gopakumaran
|
5 min read
April 29, 2024
|
Payment security

How AI is Transforming Fraud Detection in Payments

The role of AI in fraud detection is transformational. Learn more in this article to have a piece of this journey and enhance your business security.

Cashless is the new currency of the country and a fully cashless society is soon to be a reality.

Predictions are that the UAE will become fully cashless by 2030.

While digital payments are clearly convenient, there are some cons consumers and businesses both need to be wary about - especially, frauds and scams.

Over 50% increase in fraud reports for the year just proves the intensity. It gives us all the reasons why it is important to implement robust fraud detection in payment. And that’s where you can call AI or Artificial Intelligence to the rescue.

The machine learning algorithms, predictive analytics, natural language processing, and other capabilities that AI brings do not just solve the efficiency, accuracy, and user experience challenges, but also help identify malicious activities.

This article will walk you through the transformation of AI in fraud detection.

Challenges of Fraud Detection

Advancement is everywhere. While your payment systems have evolved, so have the fraud techniques become sophisticated.

Here’s the thing with the traditional fraud detection systems, they are built to work on fixed patterns and rules. They are rigid with the capability to identify just the existing trends. This is why your current detection system might fail to determine the onset of new fraud trends.

Secondly, such a system reports anything that goes beyond the fixed rules. Result? False alarms. It also blocks genuine customers out and reports them leading to business loss. This is why your business needs a system that can adapt to evolving business needs and AI in fraud detection comes into play.

How is AI Used for Fraud Detection

Artificial Intelligence uses a set of machine learning algorithms with the capability to analyze and identify abnormal behaviors or patterns. The first step in the process is - learning the normal behaviors and what’s considered standard user behaviors while making payments. For the next steps, this technology scans through all the data to find any behaviors that are off the track. It doesn’t end here, where the traditional fraud detection systems do, i.e. detect and report anything abnormal.

AI now takes a step ahead of the curve to analyze this new pattern or new behavior to understand the intention behind it. It has the capacity to alter its parameters to make sense of the new detection and understand if it is genuine or suspicious.

Based on the hypothesis, it takes immediate action by either blocking the transactions or giving access to them.

Here are some of the common AI mechanisms:

  • Data collection
  • Model training
  • Alerting and reporting
  • Feature engineering and detection
  • Self-learning

Benefits of AI for Fraud Detection

Now’s the right time to be a step ahead and safeguard your business from online threats. Learn about the benefits of machine learning and AI for fraud detection:

Enhanced Accuracy

AI algorithms are taught to pick recurring fraud instances or patterns that might miss the human eye. This meticulous scanning and detection function contributes to enhanced detection and accuracy. AI can scan through heaps of data and pick up malicious activities in no time.

Real-time Results

AI algorithms work on a real-time basis. They have the power to block suspicious activity as and when it occurs, cutting off any negative implications immediately. This keeps businesses safe from threats in all capacities.

Reduced Manual Workload

Employees would no longer spend time on manual fraud detection, monitoring, or analytics. This gives them a lot of time to focus on innovative and strategic activities to grow your business. Save your employees some time and give your business some innovative wings.

Self-learning Capacity

The technology is built to think like humans. This means it is on the quest to improve its knowledge, and the more data it gathers, the more it learns. The technology keeps growing, making better analyses and predictions. Plus, the AI systems of the world also exchange knowledge among themselves. Hence, better predictions are always evident.

Easy to Scale

No data is too much data for AI models. They have the capacity to go through tons of data, and they can do it in seconds if not milliseconds. This is extremely helpful when businesses grow. They can enjoy high accuracy and speed without having to upgrade their AI-deployed fraud detection system.

Highly Cost Effective

While there are some initial investments connected with deploying AI in fraud detection, they are cost-effective in the long run. They automate a lot of fraud detection and rectification processes and also eliminate mundane manual tasks. Not to forget, they stop fraud which can otherwise lead to heavy monetary losses. Plus, there are no additional costs during scaling.

Customer Satisfaction

Security is given with AI in fraud detection which increases customer trust and retention. Additionally, traditional limitations such as false positives are put at bay. This increases customer satisfaction and business revenue. With these benefits, business owners can enjoy a competitive advantage and massive business gains.

Common Frauds That AI Can Detect

There is no stopping new fraud scams from emerging. But, here are some of the common AI frauds you are highly likely to encounter:

Card Fraud

Scammers do not sit down to find cards with loopholes or weak security. They leverage bots to find these gaps and detect them at large to conduct a brute-force attack on payment gateways. They are extremely common and because they are done using bots, AI has the power to detect them.

AI goes beyond just reading IPs and the IP reputation of a source and into the behavior to detect what’s a bot and a real person. Based on the analysis, AI takes immediate action to block any malicious bots. CAPTCHA is another form of AI technique used to distinguish people from bots.

Fake Account Creation

The biggest prey to fake account creation is social media. There are just so many accounts creating havoc at large, and it is a bot art. They can create tons of accounts at a go to skew your, say, product reviews, spread misleading information, create malware, and more.

Heightened sign-up security is the solution you say, incorrect! Increasing the standard sign-up security process would only increase user friction, leading to an increased user drop-off rate. AI however can detect and catch bots and fraudsters from the existing signup flow.

Account Takeover (ATO)

Fraudsters cannot just create fake accounts, they can also take over your existing business accounts. This can put a strain on your business reputation and financial health.

You sure can deploy a multi-factor authentication but its effectiveness relies on users too. It doesn’t work for the ones who don’t toggle it. AI, on the other hand, has what it takes to detect the tiny clues that scream of attempted ATO, and immediately block it.

Credential Stuffing

Another method of attempted scams is credential stuffing. Well, scamsters use bots to find and fill in common usernames and passwords to crack access. They even leverage previously stolen data to detect reused passwords of users to gain access and steal.

AI is always on the lookout for accounts with multiple login failures or other such abnormal behaviors. It can find, report, and block such attempted credential stuffing breaches.

Where is AI Headed 

AI and machine learning for fraud will continue to evolve forever. This makes us confident that it can preserve your business’s security. These systems are trained to think like humans and analyze all data points like customer behaviors, device functionality, and more besides the mainstream financial data.

The result? Detection accuracy and it will just get better.

Regarding what the future holds, AI models can be trained to adapt to any possible future onsets. They will continue to be the driving security force for your business and your customers, acting as the shield of protection. We cannot emphasize their ability to self-learn and act on a real-time basis enough, which is an asset for business owners such as you. You must leverage AI in fraud detection for your payment infrastructure and reap security benefits.

Ending on this note, if you use AI for bank fraud prevention, you cannot just protect your customers from fraud but also enhance their experience transacting with you. Yes, it provides smarter detection, hypothesis, and resolution in real time. But it can also analyze customer behavior and data points that can help you make critical product enhancements and innovations.

It’s time to provide your customers with a frictionless and safe payment experience without the workload. And PayBy is here for you.

We leverage AI-based fraud monitoring, 3D secure authentication, and transaction risk analysis to provide the utmost safety. Get started with Payby to know more.

Gautham Gopakumaran
|
5 min read
April 22, 2024
|
Payment security, Artificial Intelligence

A Guide to Online Payment Security For Business Owners

Learn how your online business can secure transactions and payments for consumers to create a positive experience.

Businesses across industries have embraced online payments to improve their payment infrastructures.

We have witnessed a sharp digital shift in payments, but what remains constant is theft.

Around 4 in 10 UAE customers reported experiencing fraud attempts, and it doesn't just end there.

Identity theft is another threat shadowing the UAE when it comes to online transactions.

But this does not stop consumers from using online payment modes to transact.

In fact, customers are now more informed than ever before. They proactively choose brands offering secure payment gateways and practices.

In this article, we share the must-have online payment security methods and practices that customers using Payby follow.

Recap: What is Online Payment Security?

Online payment security consists of the methods, practices, processes, or measures that business owners adapt to save all transactions from malicious activities, fraud, data breaches, and other similar unauthorized access.

This instills customer confidence and also makes businesses immune to financial losses or legal constraints.

What are common threats to online payment security?

As a business owner, it is your responsibility to keep your company’s and customer’s data safe. Here are the most commonly reported threats to payment security and how you can avoid them:

Phishing Attacks

This is one of the most common forms of cyberattack, where scammers pose as legitimate sources with emails, websites, and messages having a close resemblance. They appear to be very convincing, tricking unaware people into making dubious payments and transfers.

Here’s how you can avoid such attacks:

  • Train your employees to help them identify and fight against such attacks when encountered. Also, plan out customer awareness drives to educate your customers.
  • Deploy authentication protocols, email filtering solutions, and Multi-Factor authentication (MFA).
  • Choose the right security solutions that successfully create the firewall required to save your stakeholders from malicious activities.
  • And, keep their solutions and software security up to date. This includes client emails, browsers, and operating systems.

Data Breaches

Access granted to anyone outside of your organization is a data breach. Weak payment gateway security or hacking can lead to unauthorized access, followed by business loss.

The first step to fighting data breaches is complying with data privacy laws and careful access management of sensitive data.

  • You must then set up an incident management system with adequate response time for when a breach occurs.
  • Figure out a process for identifying and containing the breach immediately, as well as other protocols like informing the stakeholders and communicating.
  • Devise a thorough follow-up plan for examining and finding the root cause of the breach to prevent them in the future and rectify any weak touchpoints.

Malware and Ransomware

Malware is software designed to cause harm or gain unauthorized access to systems. It can be a computer, a server, or a mobile device. Ransomware, on the other hand, aims to encrypt or disrupt a system’s data, cutting off the administrator’s access. The fraudster then asks for a ransom to give access back or help decrypt the data.

These online payment security issues can cause real harm, and this is how you can prevent them:

  • Their common sources are emails, compromised websites, and downloads. Train your employees to steer clear of them.
  • Have security measures in place for any new app or software downloads, as well as links.
  • Implement security solutions that can detect any potential malware during the download and automatically remove it.

Identity Theft

Scammers can try to steal your identity by finding your business or personal details to create new ones or gain access to existing accounts and systems. They can steal your money or even impersonate you to steal your customer’s money. Here’s what can be done to avoid it:

  • Advise your employees not to use public wi-fi networks to access your company data.
  • Deploy strong passwords to secure access, and scan systems for suspicious emails, phone calls, or text messages.
  • Monitor your business transactions and reports to identify any suspicious activity.

But, you can never be too careful with the rise in types of threats. Multiple new threats keep hitting the news, so you must follow the common best practices and safeguard your business.

Best Online Payment Security Practices to Follow 

As a business owner, you must be aware of and ready with the best payment gateway security methods. This not only enhances your customer’s trust and confidence but also keeps your business up and running. Here are all the online payment security best practices you need to know apart from using solutions such as Payby to create transactional interfaces:

1. Data Encryption (TLS & SSL Protocols)

Data encryption is one of the best security practices businesses can adopt. This process encodes payment data to provide end-to-end protection. No one else but the person with the encryption key can read this encrypted data. TLS (Transport Layer Security) and SSL (Secure Sockets Layer) are the keys that can encrypt data. They ensure the security of data exchange on the internet.

One of the best examples of these keys is securing HTTPS. Websites with “https://” have an extra layer of SSL-certified protocol, as compared to “http://” which means insecure.

2. PCI-DSS Compliance

The PCI Security Standards Council sets the standards for recording and handling customers' data by a business. This global organization lays down ground rules, terms, and conditions through its Payment Card Industry Data Security Standards (PCI-DSS) policy. Businesses must be PCI-DSS compliant to avoid security breaches and legal implications.

3. 3D Secure

This system is put in place to double-check your customer’s identity while making a payment. Banks and financial institutions generally handle this layer to verify an identity via biometric scans or PIN codes.

4. Payment Gateway Security

Embed the right payment gateway to enjoy high security. The security of your chosen payment gateway dictates your security, so you must ensure that you choose the right provider. The success of payments also depends on the provider you choose because customers go through the payment when they see a provider they know and trust.

5. Payment Tokenization

This process replaces the original payment details, like card numbers, with a digital identifier called a ‘token’. These tokens help process payments without storing customer’s data, enhancing the security of a website. This ensures security even when a website is compromised.

6. Up to Date Operating Systems

Computer systems are frequently enhanced to improve security measures. To enjoy these security measures, you must keep all your operating systems updated. It is as simple as that.

7. Prevention and Monitoring Systems

These systems are customized based on a business’s personal needs and preferences. At PayBy, we have deployed an advanced fraud detection and prevention mechanism integrated into the payment gateway to keep you secure.

8. Robust verification process

You must also have a verification process for your customer’s data to ensure no unauthorized payments are made. This includes verifying a customer’s card details, address, contact details, and more.

9. Employee Training

Train your employees to make them aware of online payment security issues. They must be able to recognize a threat and know what action to take. Such understanding on all levels is very important. Create guidelines, training sessions, and more to emphasize it.

10. Customer awareness

Not just your employees but your customers should also be informed. Plan out communications campaigns around awareness of any ongoing or potential online threats. You can also use such campaigns to drive trust among your customers and help them understand that making payments with your business is safe and secure.

11. Two-Factor Authentication

This method uses two verification steps to identify and verify a user. This additional step can prevent a lot of mishaps and enhance security. A popular example of this process is OTP confirmation, where customers must enter an OTP sent to their registered mobile number besides typing in the PIN or password.

Conclusion

Online payment security is as critical as your business solution because one small mistake can lead to monetary loss and legal implications. Not just your business and its success, but its reputation is also linked to your online payment security.

A customer data breach leads to serious legal implications, fines, negative news coverage, and a loss of reputation.

But not with PayBy.

PayBy uses AI-based fraud monitoring, 3D secure authentication, and transaction risk analysis to ensure your security as well as approval rates. We follow the best online payment security methods and practices to keep your business and customers safe.

Want to boost the online security you offer on payments? Get started with PayBy today.

Gautham Gopakumaran
|
5 min read
April 8, 2024
|
Digital payments, Payment security

7 Top Benefits Of Using Digital Payment Systems For Small Businesses

Learn about the various benefits of digital payment systems for small businesses and how to set it up to manage finances better.

Dreaming big and running into a cash flow crunch is not ideal for a small business. 

Still, 82% of small businesses that go out of business mention cash flow as the main reason. 

Keeping track of your incoming and outgoing money will help you build a sustainable and profitable business in the long run. 

With proper cash flow management, you can hire people, buy raw materials, invest money in your business, and still pay your bills and make a profit. 

But it's easier said than done, especially if you manage things the old way in sheets.

Some small businesses also use bookkeeping software to track their cash flow. 

Although it's better than managing cash flow in sheets, it often fails to keep track, especially when customer transactions are increasing and your business is growing. 

Then what’s the solution?

The short answer is digital payment systems.

In this article, we’ll discuss what it is and how your business can benefit from using it. 

But before that, let’s quickly understand what a digital payment system is. 

Recap: What is a digital payment system?

A digital payment system, also known as the electronic payment system, allows businesses and individuals to transact through electronic devices like smartphones or computers.

Digital payment systems have become super popular over the years because of their convenience, security, and efficiency. 

Smart payment solutions like Payby enable you to integrate a digital payment system for your business. 

So, whether your customer prefers to pay via a QR code, mobile wallet, or more traditional credit/debit card, you have it all on your checkout page.  

What are the benefits of using a digital payment system? 

The digital payment system has multiple benefits for small businesses. These are:

1. It’s convenient 

Digital payment systems are convenient and, hence, widely preferred by customers.

In the UAE, 88% of consumers mentioned that they have used at least one emerging digital payment method, as Mastercard mentions in one of their surveys. 

The same report mentions that consumers are turning towards digital finance options for their everyday needs because of their speed, convenience, and transparency. 

Moreover, a digital payment system can securely store a customer’s preferred payment options and card details, which means repeat customers don't have to enter the same information again. 

Offering such convenience to customers boosts repeat sales for your business. 

Recommended read: How do payment gateways impact user experience

2. Improves cash flow management

Digital transactions also help small businesses manage their cash flow effectively, enabling you to keep track of the inflow and outflow of funds. 

The transaction history gives you insight into spending trends, cash management, and sales. 

This insight can help you more accurately predict future income and expenses. 

As a business owner, you don't need to wait for checks to clear. You can receive instant payments for products/ services sold. 

Many digital payment systems integrate with accounting software, recording all incoming and outgoing transactions. 

This streamlines the reconciliation process and provides real-time visibility into your cash flow, enabling you to make informed decisions at the right time. 

Moreover, by automating the whole process, you remove the scope of manual error that would have happened if you were keeping track of the cash flow manually. 

3. Enhanced security

Digital payment systems are secured and reduce the risk of fraud as every transaction can be tracked in real-time.

With the help of secure gateways, you can enhance the security of every transaction. 

You can also safeguard customers' sensitive personal data and banking information through advanced security measures. 

With features like data encryption and fraud protection, tokenization of websites, and biometric payment methods, consumers' sensitive information can be kept safe.

For example, PayBy, which enables business growth with cashless payments, is trusted by some of the leading brands in the UAE. 

The brand is also licensed by The Central Bank of the UAE, which helps them earn trust and a good reputation.

It has been given the highest levels of financial service approvals to conduct Stored Value Facility (SVF) and Retail Payment Services (RPS) operations. 

Recommended read: Cybersecurity in digital payments

4. Broader customer base access

Digital payments allow small businesses to increase their customer base. 

With digital payment solutions, small businesses can offer their products/services to non-local customers and all those who prefer online shopping. 

Anyone with internet access can visit your website and make a purchase. 

Digital payments like Payby also empower you to run subscription-based businesses. 

You can simply integrate gateways with your existing website so you can host the payment page and customize it according to your needs. 

Plus, multiple payment options encourage customers worldwide to view and purchase from your website. 

5. Data and insights for better decision-making

Digital payment solutions generate tons of data that can give you a lot of insights.

For example, look into the transaction history to understand what time your sales peak, what are the most preferred payment methods, which is your most selling product, the purchase behavior of the customers, spending trends over the years, and where your funds are used most. 

Scrutinize these data, and you will be able to make a better business strategy that's backed by data. 

6. Shop on the go

The biggest benefit of a digital payment system is that it enables you to do a transaction anytime and anywhere. 

It’s instant, and there’s never a delay due to a nearby ATM running out of cash or you need to wait for a long time in the queue. 

You can continue to do business as usual, even if there's a holiday or a time zone difference for cross-country transactions.

7. Reduce transaction cost

Paper-based payments are a hassle for small business owners and suppliers. 

Besides the hassle, the entire transaction process is slow. 

The entire process of collecting and processing a paper check may take almost two weeks. 

Additionally, collecting and processing paper checks is a costly affair. 

Data says it costs almost $13 to send an invoice and $5 to process a single invoice check. 

Digital payments are easy, hassle-free, fast, and less expensive for businesses. Plus, it’s environmentally friendly too!

Ready to transition to a digital payment system?

If you’re a small business owner, implementing a digital payment solution can be really beneficial to grow your business. 

Payby offers various payment solutions that are perfect for small businesses to scale their business. 

Whether you want to set up QR code payments, payment gateway, virtual accounts, wallets, or recurring payments and auto-debits, Payby has got you covered. 

It also offers the lowest transaction/ payment processing rates, which means you have more control over the revenue you get from each sale. 

Ready to explore?

Get started with Payby today.

Gautham Gopakumaran
|
5 min read
April 2, 2024
|
Digital payments, Small businesses

How to Improve Payment Processing User Experience

Learn about the different ways in which your online business can improve the overall customer experience during payments and transactional processes.

As the world embraces a digital future, user experience remains the make-or-break moment for online payments. 

A poorly designed payment process is frustrating for the customer and can cause a big headache when completing the payment process. 

Result

You miss out on sales no matter how good a deal or the product/ service is. 

As data says, 88% of online consumers are less likely to return to a site after a bad user experience. 

On the flip side, a well-crafted payment processing system builds customer trust. 

This not only helps to close the transaction but increases your repeat sales.

As data says, companies see $100 ROI per $1 investment in user experience.

In this article, we’ll see how to improve user experience in payment processing. 

But before that, here is a quick recap to understand why you should be concerned about the payment processing user experience. 

Why is a good payment processing user experience important? 

A good payment processing user experience not just delights a customer but also sets the foundation for customer loyalty. 

As a result, you will see a boost in your repeat sales. 

Additionally, satisfied customers will always talk about their experience with acquaintances. 

And, any brand will admit that word-of-mouth marketing is the best marketing option any day.

Clarity and transparency

 A well-designed payment processing system instills trust through transparency. 

Offering clarity in payment processing means customers are aware of all the payment options available so that they can choose their preferred payment option. 

Additionally, maintaining transparency gives them a clear picture of the total cost of the product/service, taxes, delivery cost ( if any), or any other additional cost. 

Ensure that all the payment-related information is presented in a clear and straightforward manner. 

Convenience and speed

Today, customers are tech-savvy and prefer speed and convenience. 

Having a payment processing system that’s quick and convenient boosts the overall customer experience. 

On the other hand, a slow and floppy payment processing system turns off the customer and drives them away. 

Security

While digital payment is convenient and faster, it also comes with security concerns. 

Customers want to feel confident that the transaction process is genuine and that their sensitive personal data is handled carefully. 

Designing a payment process with PCI-level compliance is a must for businesses that ensure the highest customer security standards. 

Responsiveness

Customers value payment processing systems that demonstrate responsiveness. 

Sites that quickly resolve payment issues, disputed transactions, and 24/7 support are always preferred over transaction systems that are slow and unresponsive. 

Mobile optimization

Mobile transactions are extremely popular in the UAE.

As a survey suggests, 94% of the customers in the UAE used at least one digital feature during their last purchase.

The same survey suggests that 43% of the users suggested that an easy checkout experience is one of the reasons for online shopping. 

So, focus on mobile optimization and responsive UX designs that offer mobile users the same convenience and efficiency as desktop users.

Now, let’s understand how you can improve the payment processing experience. 

Ways to improve payment processing experience 

While each business is different and their needs vary, here are a few ways many businesses have improved their payment processing experience, and you can do too. 

Simplifying the Checkout Process

A simplified checkout process helps customers complete the transaction and creates a better customer experience. 

Customers who have a positive experience during the checkout process are more likely to return for future purchases. 

Here are a few things that you can do to streamline the checkout process.

  • Minimize the number of steps by offering guest checkout.
  • Filling out unnecessary details like birthdays and anniversaries is time-consuming and often quickly turns buyers off. Instead, gather only the necessary data that are compulsory to complete the payment.
  • Provide clear instructions for each step so there’s no confusion.
  • Use trust signals like a secure payment logo.
  • Offer one-click payments for quick transactions.
  • Keep the checkout process to a single page. Scrolling from page to page can distract a customer, causing a loss in sales. Further, it will also factor in if there are any internet issues. 

Optimizing for Mobile

Optimize your payment processing system for mobile users. A few things to consider:

  • Pay attention to responsive design that can adapt to any screen size.
  • Offer in-app payments by integrating the payment gateway into the app for a quicker payment experience instead of directing the customer to the website payment page, which may disrupt the payment flow.
  • One of the biggest inconveniences for buyers is signing up and providing login details before they can checkout. So, keep that in mind. 
  • Look for a payment gateway that offers QR code payment, mobile wallets, or displays the bank account details where you can asynchronously process the payment without logging in.

Enhancing Payment Security

Consumers need to be comfortable doing a transaction on your website. 

For this, they must ensure that your payment processing system is secure. Things that you can do:

  • You must comply with PCI DSS regulations. If you adhere to this guideline, convey this information to the consumer. That way, they’ll be assured that your system protects credit/debit card details by utilizing tokenization and multifactor authentication. 
  • Display the PCI DSS logo on your checkout page to show customers you care about their data safety. 

Offering Multiple Payment Options

Choose payment gateways that allow users to choose from diverse payment modes. 

  • While multiple payment modes are available to integrate into your website, some popular methods include credit/debit cards, mobile wallets, UPI payments, etc. 
  • Solutions like PayBy can enable cashless transactions and online payments via various international and domestic credit cards, debit cards, and over 1.5 billion wallets.
  • It easily integrates with your existing website, so you can host the payment page and customize it according to your needs. 

Improving Payment Gateway Speed

The speed and efficiency of the payment gateway can be a game-changer for your business. 

Here are some ways to improve the payment gateway speed:

  • Streamline the checkout process with minimal steps. 
  • Partner with a third-party payment processing platform that can handle multiple transactions at once. 

Providing Clear Error Messages 

After completing each transaction, send a clear communication to the customer so that they know their payment has gone through.

But if there is a transaction failure, ensure to communicate it as well. 

Few things to consider:

  • If there’s an error from the issuing bank, have the customer check the card details. If the problem persists, have the customer contact the issuing bank. 
  • Meanwhile, you can prompt the customer to use another payment option to complete the transaction.
  • If there are technical issues with the payment gateway, inform the customer immediately with a clear message, along with the details of the transaction if it has already been initiated. For example, your message may read, “Any deducted funds will be credited back to the original source in 48 hours.” 

Personalizing the Payment Experience 

Personalization is a clear winner in today’s hyper-competitive market. 

So why not bring it into your payment processing system to WOW your customers? 

Here are a few things to consider:

  • Make your customers feel valued by showing them their preferred payment options.
  • Use localization and customization features to offer your payment process in different regional languages, currencies, and markets. 
  • Combine each transaction with a loyalty or reward program to recognize repeat customers while up-selling and cross-selling your products. 
  • Once the transaction is completed, direct your customers to a thank you page to offer your gratitude. 

Continually measure and improve 

Once you have implemented the payment processing system successfully, remember to measure and track its performance continually. 

Tons of data are produced whenever a purchase is made—for example, the products purchased, when the product was sold, what payment method was used, and so on. 

Analyzing this information through a payment analytics lens can help you make a lot of data-driven decisions.

For example, whether your existing payment processing system is working or needs improvement, whether your customer is new or repeat, what their purchasing habits are, whether you need to expand on certain product offerings, and so on.

Some of the metrics that you can measure:

  • Payment types and methods to understand customer preferences.
  • Chargeback rates so that you can reduce any unnecessary chargeback rates and improve customer experience.
  • Transaction volume and velocity to understand your peak sales time.
  • Transaction amounts and values to understand how much people are spending and how you can improve that.

Time to improve your payment processing user experience

If you’re ready to improve your payment processing user experience, it’s time to partner with a payment solution that builds solutions with user-first intent and does not compromise on business needs. 

Payby enables business growth with cashless payments so that you can increase your revenue while prioritizing customer experience. 

Payby offers complete online payment solutions for businesses across all industries. 

Solutions range from payment gateways and QR code payments to virtual accounts, mobile wallets, recurring payments, and more. 

Ready to explore more?

Get started here. 

Gautham Gopakumaran
|
5 min read
March 18, 2024
|
Digital payments, Customer experience

The Role of Digital Payments in Enhancing Customer Loyalty

Learn how the digital payment experience you offer to customers boosts retention and loyalty towards your brand.

Digital payments have been around for over a decade, but the pandemic has catalyzed its adoption across countries and virtually all categories. 

As McKinsey reports in a 2023 survey, for the first time, more than nine out of ten consumers mentioned that they had used some form of digital payment during the year. 

The scene is no different in the UAE region. 

Statista mentions that the total transaction value in the digital payments market is projected to reach US$29.75bn in 2024.

Digital payments have been gaining popularity and quick adoption as a convenient and secure way of transacting. 

They’re fast, hassle-free, and can be done on the go. 

But have you ever thought digital payments can also help you build loyalty? 

In this article, we will discuss how you can leverage digital payments to enhance your customer loyalty. 

But before that, let's do a quick recap to understand why digital payments are getting so popular. 

Why is the demand for digital payments increasing? 

There’s not one but multiple reasons behind the growing appetite for digital payments: 

1. Convenience

As customers are becoming more tech-savvy, they prefer quick solutions and convenience. 

Digital payments offer convenience as a digital transaction doesn't take more than a couple of minutes.

Moreover, it can be done anytime and anywhere. 

2. Personalization

Digital payments offer a variety of payment modes.

So, brands can offer various modes of digital transaction, such as credit/debit cards, UPI, mobile wallets, internet banking, mobile banking, etc., to facilitate a smooth transaction.

Brands can analyze customer behavior, preferences, and buying patterns to personalize these options. 

3. Digital transformation

The past decade has been an era of digital transformation. 

The years between 2011 and 2020 have witnessed how digital technologies have reshaped the business world. 

The digital transformation journey is still on. 

According to the IMD World Digital Competitiveness Ranking 2023 report, the UAE was ranked 12th among 64 countries reviewed globally and 6th among 40 countries in the European and MENA group in terms of digital competitiveness.

As businesses undergo a digital transformation, digital payments become a natural part of the process. 

4. Better security and trust 

Digital payments are safe and secure.

Some of the key security measures behind digital systems include two-factor authentication, encryption, authorization, biometrics, tokenization, email validation and authentication, and secure socket layer (SSL) and transport layer security (TLS). 

This is one of the main reasons consumers today trust digital transactions and rely on it. 

How do digital payments build loyalty? 

We all will agree that building customer loyalty is paramount today for every brand, irrespective of its size and nature of business. 

Today, every brand strives to meet and exceed customer expectations, so the shift is now towards creating a seamless experience for the customer.

Digital payments powered by BaaS are at the forefront of this journey and play a crucial role in building customer loyalty. 

Let’s understand how:

1. Creating a seamless checkout experience

The checkout process is the final touchpoint between a consumer and a brand, and the ease or difficulty determines if the consumer will close the transaction.

A seamless and hassle-free checkout process can be a game-changer. As a study mentions, 88% of customers are less likely to return to a brand if they had a bad previous experience. 

So, focus on creating a seamless checkout experience to build your base of loyal customers. 

2. Frictionless experience

Frictionless experiences have become an industry benchmark in the digital landscape, and BaaS products play a pivotal role in creating a frictionless experience for the consumer. 

Integrating a BaaS layer in their product not only works as a payment gateway for the brand but also creates a frictional experience for the customer's entire checkout journey. 

By optimizing the transaction process and minimizing redirects, the entire checkout journey becomes faster and more intuitive for the customer.

Customers who value their time and prefer convenience are likely to incline towards platforms that offer frictionless experiences, making them likely to return to you for future purchases. 

Remember that a frictionless experience can be your most significant differentiator in a hyper-competitive market. 

3. Personalized experience

Digital payments can be customized based on the user preference and previous purchase behavior.

For example, if a consumer has previously used digital wallets to make a payment, brands can display the same digital wallet at the top of the payment options on the checkout page to help close the transaction faster. 

Similarly, offering loyalty rewards with their preferred digital payment options can make them feel valued and understood, which works as the foundation for building strong brand loyalty. 

The different embedded payment systems can give businesses essential insights into customer behavior, preferences, and spending habits. 

Using these data, brands can send personalized discounts, recommendations, and loyalty rewards that will help strengthen brand loyalty further. 

4. Diverse payment options

Embedded digital payment solutions are revolutionizing how businesses manage transactions. 

One of the biggest advantages of digital payments is its versatility to offer different payment modes. 

From the good old credit/debit cards to the modern digital wallets, these integrated payment options ensure businesses can meet consumers' diverse preferences. 

This flexibility to choose the preferred payment method not only improves the transaction process but also offers a great customer experience. 

And we all know how continued good customer experience helps foster loyalty in the long run. 

5. Better security 

As Statista mentions, from July 2022 to June 2023, around 38 percent of cyberattacks and network intrusions occurred in the MENA region, with the UAE in second place among the most targeted countries in the region. 

The topmost priority for the BaaS platforms is to enhance their security measures and make them a fundamental part of their services. 

Some measures the BaaS providers take include a multi-layered approach to safeguard crucial data. 

This is achieved by multi-layered encryption techniques where all transactions are encoded. 

Such strong measures not only stop cyberattacks from happening but also instill confidence and trust among brands and their customers, reinforcing the fact that digital transactions are secured. 

Foster customer loyalty with digital payments

In this digital era, businesses are revolutionizing their payment solutions with digital payments, thus reshaping the customer-business relationship. 

Businesses are streamlining their transactions by seamlessly integrating different digital payment solutions into their platforms and enhancing user experience and customer loyalty. 

You, too, can tap into the potential of digital payment systems to build loyalty. 

But this is only possible when you have the right systems in place. 

PayBy can help you get started. 

PayBy enables businesses to make cashless payments and increases their revenue with customer-first, innovative, and secure omnichannel digital payment solutions. 

You can integrate PayBy with your website to set up a payment gateway. 

PayBy also lets you enable cashless transactions, online payments via domestic and international debit and credit cards, and over 1.5 billion wallets. 

Want to enable in-app payments? 

Worry not! 

Integrate with PayBy to offer in-app payment solutions with an optimized mobile pay page and secure transaction interface.

And did we tell you that PayBy is trusted by leading brands in the UAE and licensed by The Central Bank of the UAE, which demonstrates its highest level of financial service approvals to conduct Stored Value Facility and Retail Payment Service Operations? 

Sign up today

Gautham Gopakumaran
|
5 min read
March 11, 2024
|
Digital payments, Customer loyalty

Subscription-Based Business Models

Leveraging Digital Payments for Recurring Revenue
Learn how digital payments can help subscription-based businesses secure recurring revenue by offering a positive customer experience.

Various industries have seen rapid growth in subscription-based business models over the last few years.

According to The Subscription Economy Index report, the subscription industry has grown by 435% in the past decade. And it’s expected to grow even bigger and reach a market size of $1.5 trillion by 2025. 

Seeing the data above, we can say safely that the subscription economy is here to stay. 

Be it a gym subscription, an OTT subscription, a subscription-based service, or a subscription to a SaaS tool — researchers say that eight in ten adults use some form of subscription product/ service and will continue to do so. 

But, what makes subscription business models so popular?

Subscription-based products/ services provide an affordable way for customers to access what they need. It has been proved that consumers won't mind paying for access to exclusive content/products/services. 

On the other hand, subscription commerce allows businesses to provide their services/products directly to customers, ensuring a better customer experience and a long-term relationship. 

Plus, the subscription model ensures a regular cash flow for businesses. 

However, retaining the customer long-term is not easy. While the success of the subscription business primarily depends on the continuous value added by the business, the ease of payment is equally important. 

In this article, we will discuss how subscription-based businesses can leverage digital payments to streamline recurring revenue, focusing on automation, reliability, and customer convenience.

Benefits of Digital Payments for Subscription Businesses 

From having complete control of your billing cycle and cash flow to improved customer experience through seamless transactions — there are not one but multiple benefits of digital payments for a subscription business. Let’s look at them. 

1. Improved Customer Experience

The most significant benefit of digital payment for subscription business is a seamless transaction experience for the consumers.

Digital payments make transactions faster. Consumers can set auto renewal mode with their preferred payment option to renew the subscription to the product/service. 

Consumers can even save the payment information details in a secure environment so that they don't have to enter all the details every time a transaction happens. 

They can simply set up the payment details once and enjoy the product/ service until they want to pause/cancel it. 

2. Enhanced Security Measures

Digital payments are safer than the traditional payment methods. 

With features like data encryption and fraud protection, tokenization of websites, and biometric payment methods, consumers trust digital payment methods. 

For example, PayBy, which enables business growth with cashless payments, is trusted by some of the leading brands in the UAE. 

The brand is also licensed by The Central Bank of the UAE, which helps them earn trust and a good reputation.

It has been given the highest levels of financial service approvals to conduct Stored Value Facility (SVF) and Retail Payment Services (RPS) operations. 

3. Diverse Payment Methods

Digital payment methods allow businesses to offer multiple payment methods, facilitating international transactions. 

The diverse payment methods enable customers to make cashless payments via 50+ payment modes. 

These include some of the popular customer choices like credit/debit cards, net banking, AliPay+, PayBy, Botim, and other digital wallets. 

Diverse payment options help subscription businesses reduce churn by offering various payment options for customers so that they can easily renew their subscriptions.

It also helps in global accessibility and currency support, which is essential for businesses that are operating globally. 

4. Streamlining Billing and Invoicing

Subscription businesses can automate their billing processes with digital payment methods. You can create a custom schedule to collect recurring payments from customers. 

All you need to do is set up a billing cycle of weekly, biweekly, monthly, or yearly payments for your subscription business.

With auto-debit on recurring payments, you can ensure continuous cash flow for your business. 

By leveraging digital payments, subscription business owners can create branded invoices and automate sharing via email or SMS with their recurring customers.

You can also provide customers with instant payment confirmation on recurring purchases with branded digital receipts. 

This helps build trust and reduce churn while minimizing failed transactions. 

Plus, digital payment methods empower you and the customer for a cashless transaction with a click-to-pay functionality on your invoices. 

Additionally, you can ensure further customer convenience by offering flexible payment plans, giving them full control. 

For example, you can offer options like buy now and pay later, pause payments when they don't want the subscription, change the payment mode, and so on.

5. Leveraging Subscription Management Platforms

Subscription management platforms like PayBy let you integrate payment gateways with your existing website so you can host the payment page and customize it according to your needs.  

And did you know that payment pages powered by PayBy are mobile-optimized, too?

PayBy also lets you offer customization and flexibility to your consumers. 

So, users can choose from diverse payment modes.

For example, you can enable cashless transactions and online payments via various international and domestic credit cards, debit cards, and over 1.5 billion wallets.

By leveraging subscription management platforms, subscription businesses can keep a tab of their recurring payment status on a real-time dashboard. 

Such real-time insights can help you identify inactive customers and payment failures so that you can make informed decisions to reduce customer churn. 

Improve recurring revenue with digital payments 

Payments are now an important part of the customer experience. 

Subscription businesses that rely on recurring payment, offering multiple payment options, directly address the customer's need for a seamless payment experience. 

Additionally, recurring payments help businesses to grow by ensuring continuous cash flow. 

PayBy helps subscription businesses to collect recurring payments easily. It offers everything a business needs to collect a payment on schedule. 

It gives complete control of the billing cycle and cash flow with auto debit on recurring payments. 

Get started with PayBy today. 

Gautham Gopakumaran
|
5 min read
February 26, 2024
|
Subscriptions, Cashless Payments

Do Payment Gateways Impact Checkout Conversion Rates

Learn how the payment gateway you use for online and offline transactions can impact the overall checkout conversion rate.

Irrespective of the industry your business is in, the checkout is often the make or break point. 

According to Baymard Institute, the average documented transaction abandonment rate is as high as 70-89% across industries. 

And one of the leading factors for abandonment is reported to be the payment gateway one offers. 

In this post, we look into how payment gateways impact your conversion rate and what you can do to improve it. 

How do payment gateways impact conversions 

Let’s take a quick look at why and how the payment gateway impacts how many consumers complete a transaction: 

1. Speed to checkout

A good payment gateway helps convert the consumer before they can change their mind about making the purchase. The lesser the time to think, the higher are conversion rates - enabling impulse and momentary interest in product/ service is key. 

A very long checkout process or technical glitches that slow down the same can create room for drop-offs of even the highest purchase intent buyers. 

Good payment gateways come with optimized checkout processes and a high uptime to ensure your business is always ready for transactions. 

2. Security and trust

One of the primary concerns of online shoppers is the security offered by payment gateways. And the concern is justified. 

Payment gateway breaches and fraud are common. 

A report by Stripe mentions that 71% of businesses have reported that they have been targeted by payment fraud at least once. 

An average payment gateway breach can cost USD 9.44 million - businesses don’t just need to secure themselves, but also ensure they give consumers a safe platform to make transactions. 

3. Global accessibility 

When selling globally, businesses need to adapt to consumer payment preferences rapidly. This is where the importance of a payment gateway that comes with currency support and multi-language capabilities becomes important. 

At the same time, it is also important for businesses to adapt to device preferences over which consumers engage with them, giving them a way to checkout faster without the back and forth between pages. 

Right from the currency, preferred payment modes, devices and more, a good payment gateway enables businesses to adapt to local preferences quickly. 

Best practices to follow to ensure higher conversions 

If your business has been experiencing lower conversion rates, here’s what you can do to improve the number: 

1. Streamline the checkout process

Since the checkout process is a crucial step toward conversion, it’s important to keep it simple and remove any friction that can lead to customer frustration. Here are a few steps to remember: 

  • Keep the checkout process to a single page. Scrolling from page to page can distract a customer, causing a loss in sales. Further, it will also factor in if there are any internet issues. 
  • Offer alternative payment methods so that your customers have one or two preferred payment methods included. This will also attract customers who don't have access to or don't prefer the traditional payment methods.
  • Implement a one-click payment system that’s convenient and encourages on-the-go shopping. In this system, the sensitive data is secured with PCI and tokenized on the website.
  • Filling out unnecessary details like birthdays and anniversaries is time-consuming and often turns off buyers who are in a hurry. Instead, gather only the necessary data that are compulsory to complete the payment.
  • One of the biggest inconveniences for buyers is when they have to sign up and provide login details before they can checkout. Look for a payment gateway that offers QR code payment or displays the bank account details where you can asynchronously process the payment without having to log in. 

2. Offer diverse payment modes 

Choose payment gateways that allow users to choose from diverse payment modes. 

For example, with PayBy, you can enable cashless transactions and online payments via various international and domestic credit cards, debit cards, and over 1.5 billion wallets.

It easily integrates with your existing website, so you can host the payment page and customize it according to your needs. 

And did we say that payment pages powered by PayBy are optimized for mobile phones, too?

3. Ensure speed and reliability

One of the biggest turnoffs for consumers is a slow and unreliable transaction process. Irrespective of the products/ services in the equation, this can result in the consumer losing trust in your business. 

A good payment gateway enables you to offer speed and reliability to your consumers. They are also licensed to enable transactions by legal authorities, giving you and the consumer, further peace of mind. 

For instance, Payby is licensed by The Central Bank of the UAE. It has been given the highest levels of financial service approvals to conduct Stored Value Facility (SVF) and Retail Payment Services (RPS) operations. 

4. Ensure mobile responsiveness 

Data says that at least 79% of mobile users have made a purchase at least once using their mobile phones. 

So, ensure your payment gateway has mobile responsiveness for consumers who prefer to shop using their handheld devices. 

A good payment gateway offers an optimized mobile pay page along with secure mobile payment modes. 

5. A/B testing and analytics

Continuously A/B test different elements, designs, and functionalities of payment gateways to determine the best configuration that gives you maximum conversion. 

You can A/B test the payment gateway among a subset of customers to understand the preference for local payment methods. 

Track and analyze the data to understand how it’s impacting conversion and the average order value. 

Are you ready to improve your conversion rates?

While there are many options in the market that can help you set up a payment gateway, Payby is one of the leading solutions in the UAE and is trusted by leading brands across industries. 

PayBy’s solution caters to a vast array of industries, including fitness and wellness, insurance, travel and tourism, social products and services, restaurants and cafes, hospitals and healthcare, information technology and services, gaming betting and casinos, and more - alongwith the ability to scale with the size of your business.  

Its easy integration feature works seamlessly with your existing technology – be it your website or app. 

Payby comes with several other powerful features that go beyond improving your conversion rates, and boosting the experience you deliver to consumers. This includes the ability to generate digital receipts, invoices, payment links and more. 

Want to know more about how Payby payment gateways can improve your conversion rate? 

Get started with Payby today

Gautham Gopakumaran
|
5 min read
February 19, 2024
|
Payment Gateway, Checkout

How do Payment Gateways Impact the User Experience

Learn why payment gateways have an impact on the overall user experience and how you can ensure a positive one to increase transaction rates.

As businesses grow, they need to integrate a secure payment processing system. While some companies may still prefer to invoice customers to reduce card transaction fees, a report mentions that “£23.4 billion worth of late invoices are owed to firms across Britain.” 

Late invoices can significantly impact the cash flow of the business. Accepting multiple payment methods not only improves the situation for business but also offers a positive customer experience. 

A payment process that is quick, easy, and tailored to the local business environment enhances overall customer experience and loyalty. 

Recap: What is a payment gateway?

Payment through a payment gateway is one of the many options that brands can integrate into their online stores for easy payment processing.

Payment gateways are a key component in electronic payment processing systems and work as the front-end technology that captures the customer payment information.

It then sends it to the merchant-acquiring bank, where the transaction is processed. A payment gateway is one of the popular modes of online payment today that is used across industries. 

How do payment gateways impact customer experience? 

Making a payment and checking out is the last mile in a buyer’s journey, and the transaction experience with the payment gateway can deeply impact the customer experience.

Here are some instances of how payment gateway impacts the customer experience: 

1. Ease of use

Customers continuously seek convenience and ease of use, and a seamless online transaction experience can impact the overall customer experience positively. 

For example, a user-friendly payment gateway interface makes it easy for customers to make a quick payment and checkout from the online store. 

On the other hand, a cumbersome interface can be a big turnoff for an impatient customer. 

2. Reduce friction

The payment gateway also helps to reduce the friction between the customer and the business by facilitating a hassle-free shopping experience.

Be it credit cards, debit cards, or digital wallets — payment getaways can offer a seamless transaction, boost sales, and reduce cart abandonment rates, especially for e-commerce stores. 

How to set up a payment gateway for positive customer experiences? 

If you’re introducing payment gateways for your website, here are some tips to help you achieve a positive customer experience: 

1. User-friendly interface and checkout experience

The checkout process is the most crucial step in a buyer’s journey, and this should be made as seamless as possible.

That’s why a user-friendly payment gateway interface is important to impart customer satisfaction.

A poorly designed payment gateway interface can frustrate a customer, resulting in cart abandonment. 

2. Mobile responsiveness and accessibility

Customers today prefer to shop on the go. With easy access to smartphones, brands need to make the shopping experience convenient for on-the-go shoppers.

Thus, they need to ensure that the payment gateways work smoothly across various devices, including smartphones.

Remember, the ability to facilitate mobile payment is no longer a luxury but a must for brands to stay ahead of the competition. 

3. Security for trust

Payment gateways with robust security features, including encryption and fraud prevention measures, play a big role in gaining customers' trust.

Customers need to feel safe with their banking information, so brands that want to build a positive user experience must pay attention to safeguarding their payment gateways.

Creating trust is not just meant to keep the customer payment information safe but also to build customer loyalty, which translates to repeat sales.

4. Personalization

Tailoring the payment gateways based on customer profiles creates a more relevant transaction experience for the customer.

In an era when customers expect everything to be personalized, a tailored payment gateway for the customer will definitely help you earn some brownie points. 

5. Transaction speed

Customers today prefer a fast and smooth transaction experience. Payment gateways that offer swift and smooth transaction experiences are surely going to earn some praise from customers.

Remember, a fast transaction speed not only satisfies the impatient customer but also helps improve the overall brand perception.

Payment gateway best practices

If you want your customers to have a great user experience while using your payment gateway, here are some tips for you: 

Keep customer convenience in mind

Make it simple and easy for your customers. For example, if you’re in a subscription business, offer recurring payment options that help them renew their subscriptions easily. 

You may also consider integrating various payment methods like payment through credit cards, debit cards, UPI, net banking, COD, cheque, etc., for your website so that customers can choose the best-suited option for payment. 

Minimize risks

Ensure your payment gateways are capable of encrypting sensitive customer payment information like account numbers. It should also offer various verification procedures and secure card information.

Always use SSL-certified payment gateways along with a secure logo.

Clear communication

Always maintain clear and transparent communication with customers. Keep them updated about any failed transactions, payment status, and due payments so that customers feel assured. 

Maintaining clear communication helps to build trust, which improves sales. 

How to choose a payment gateway for a better user experience

There are several options to consider while picking a payment gateway. Here are some pointers for you to consider: 

Know the preferences of your customers

To positively impact the user experience, it's important to know what payment gateway your customers are already using.

If you choose payment gateways your customers are already familiar with, then you'll see better adoption, and you'll run into lower risks.

Check for integrations

Check for the API integrations of the payment gateway and if it will work with your existing technology. 

Choosing a solution that doesn't integrate with your technology will be of no use and will slow down the entire process.

Look for robust security

Security and fraud prevention are of utmost importance, so you need to be vigilant with the security system of the payment gateway. 

Look for PCI-compliant companies that uphold security provisions for electronic transactions. 

With PCI compliance, you can be assured that your customer's payment information will be protected and secured from theft. 

Consider the fees

Compare the costs of the payment gateways and how they will affect the security cost.

For example, if the payment gateway has a low fee but you have to invest in its security and fraud detection, the overall cost can increase. 

Check their market worth

Invest in a payment gateway that is trusted by customers.

Avoid payment gateways that don't have a strong security history to prevent customers from abandoning their carts or, even worse, cases of fraudulence. 

Choose payment gateways that have a respectable clientele list. 

Opt for flexibility

Flexibility is one of the key attributes to look for when choosing your payment gateway. 

Remember, each customer is different and has different preferences, so offer them a solution where they can quickly switch between credit cards, debit cards, UPI, Android, and Apple Pay, etc., and have a smooth transaction experience. 

Picking the right payment gateway for your business

Now that you’re ready to set up your first payment gateway, try PayBy — it seamlessly integrates with your existing system, and you can set it up easily. Licensed by The Central Bank of UAE, PayBy is trusted by some of the leading brands in UAE. 

PayBy can manage all end-to-end transactions via domestic and international credit cards and integrates with your website and apps easily. 

Get started today

Gautham Gopakumaran
|
5 min read
February 5, 2024
|
Payment Gateway

The Evolution of Online Payments

From Barter to Cashless
Explore the transformative journey from ancient barter to modern cashless transactions. Uncover the history of payment methods and the UAE's pivotal role in the digital payment revolution.

Like it or not, money is a crucial part of our life. It allows us to buy things that let us live a comfortable and decent life. However, money has been in existence in some form or another for just about 5000 years. 

Before that time, there was a barter system that ancient people used to trade. Slowly, as humankind evolved, money evolved, too. 

From printing the first currency note to cashless transactions and bitcoins, needless to say, technological advancements have revolutionized payment methods. 

We’re here to take a step back and deep dive into understanding the evolution of online payments.

The Barter System: Trade in Ancient Times

Long before money was invented, ancient people used a barter system to exchange goods and services. This oldest form of commerce, which was practiced for centuries, involved two individuals negotiating their goods or services before they exchanged them in the form of trade. 

For example, a farmer may exchange his crops for a cow or salt. The quantity of rice to exchange used to depend on the perceived value of salt or cattle. 

It is believed that the first barter system was introduced by the Mesopotamians all the way back to 6000 BC. Later, it was adopted by the Phoenicians, who used it to barter goods with others across the oceans. 

With the rise of the Babylonians came a further improved bartering system when goods were exchanged for food, tea, weapons, and spices. 

Salt was another common and expensive merchandise that was exchanged. In fact, the Roman soldiers were paid their salaries with salt. 

In the Middle Ages, Europeans who traveled around the world started to barter crafts and furs in exchange for silk and perfume. 

Musket balls, deer skins, and wheat were some of the common barter items used by the colonial Americans. 

However, the barter system had its own limitations, too. 

The most common problem with the barter system was its inefficiency. 

For example, if a farmer wanted to exchange his rice for timber, he had to find someone who would have timber and wanted to exchange it for rice. The other problem was ensuring a fair exchange because the perceived value of goods and services varied.

The Introduction of Currency: Simplifying Trade

As we discussed, primitive societies used the barter system to exchange goods and services. Some ancient tribes also bartered goods in exchange for shells. However, the barter system had its own pitfalls, which slowly led to the invention of metal coins. 

The development of metal coins is estimated to date back to 700 to 500 BCE. Since the coins were standardized, trading became easy. The invention of gold and silver coins also made trade easy and convenient between countries. A country that had a surplus of any item could easily sell it to another country in exchange for coins.

The transition to paper notes happened in 1260 CE when the Yuan Dynasty of China switched to paper currency from coins. However, some parts of Europe continued to use metal coins until the 16th century. 

Introduction of banks

Later, once the banks became functional, they started to replace the coins using paper notes. People could take these notes to the bank to exchange for gold, silver, or coins. The paper money made it easy for everyone to buy goods and services.  

The shift to paper money simplified international trade. It enabled the movement of goods from one country to another, migration, and settlement, and created socioeconomic distinctions. 

The Advent of Electronic Payments

Although one may assume that electronic payment methods like credit and debit cards are modern payment methods, the earliest history of credit cards dates back to 5000 years ago in ancient Mesopotamia. Inscriptions bearing mutual agreements on clay tablets were used when people wanted to buy at the moment and pay later. 

Fast forward to modern times, and those ancient clay tablets paved the way for store cards when merchants issued cards to farmers as a receipt of loans. The farmers who didn't have money to pay upfront used to pay later once crops were harvested. 

In 1950, the Diner's Club became the most popular and widely accepted form of credit card when its founder left his wallet at home while out dining. Diner's Club users would charge their meals to the card, and the restaurant would send the bill directly to the Diner's Club. The cardholders had to pay the bill to the Diner's Club at the end of the month. 

In 1958, American Express, originally a freight company, came up with its first credit card that allowed its customers to pay bills via the credit card. 

In 1966, the first interbank card was released when a group of California-based banks came together into a partnership. This card eventually evolved into the present-day MasterCard in 1979.

Credit cards got a new dimension with the advancement of technology. In the 1960s, an IBM engineer affixed magnetic tape on the back of the card so that the user got the updates when their cards were swiped at a point-of-sale. 

The popularity of credit cards saw some marked differences in buyer behavior. Different research studies have proved that credit cards increase the pleasure of buying, and users are willing to pay higher prices when given a chance to pay through credit cards. 

One hypothesis suggests that since credit cards reduce the "pain" of payment, they remove the holds on expenditure. A neural mechanism study associated with credit card purchases showed that a strong activation at the striatum occurs on the onset of credit card cue. 

The Digital Revolution: Birth of Online Payments

Online payment is an irreplaceable part of our modern lifestyle. The origin of online payment can be traced back to 1871 when Western Union introduced online money transfer in the US.

For the first time, people could pay for goods without being physically present for the transaction. However, the online payment mode saw rapid growth only after 1960 when the US Advanced Research Projects Agency Network laid the foundation of the modern-day internet.

Since then, the online payment landscape has rapidly evolved. 

Key Milestones

In 1994, the Stanford Federal Credit Union became the first financial institution in North America to launch its online banking service for its customers. 

As the banking industry saw the digital transformation, more financial corporations started embracing this journey. 

In the late 90s, PayPal entered the market and became the first global payment service provider.

Starting from the early 2000s, different companies across Asia started adopting the online payment mode. 

The UAE's banking sector has been at the forefront of digital transformation. Banks like Emirates NBD and Abu Dhabi Commercial Bank have pioneered online banking services, significantly enhancing customer convenience and transaction efficiency in the region.

Alibaba was established in 1999 as the first ecommerce platform in China. 

The next in line was the rise of digital wallets, which came into existence in 2011 when Google Wallet was launched ( Now known as Google Pay).

Today, most digital wallets are powered by cloud technology that offers inbuilt security and on-demand scalability and comes with intense processing features.

As the global landscape shifted towards electronic and online payments, the UAE too made significant strides in embracing digital technology. The introduction of real-time payment systems in the UAE, as part of a broader Middle Eastern strategy, signifies a pivotal move towards digital adoption. 

Notably, initiatives like the GCC RTGS (Real Time Gross Settlement System) and the Arab Regional Payment System (BUNA) have been instrumental in standardizing and enhancing payment efficiency across the Gulf and Arab regions. 

These efforts reflect the UAE's commitment to modernizing its payment infrastructure, aligning with global trends while catering to regional needs.

The Rise of Mobile Payments and E-Wallets

As online payments and digital wallets gained prominence, we saw a sharp rise in mobile payments and e-wallets. As smartphones became affordable and accessible to all, mobile payments saw rapid adoption among the population. 

With e-wallets, carrying cash becomes unnecessary as your money is safely stored on your smartphone. Moreover, with mobile payment, you don't need to look around for ATMs to withdraw money— you can make a payment as long as you have a smartphone and internet connectivity. 

Consumer behavior also witnessed a stark difference with the change in technology. Businesses started to offer payment in digital mode to improve the customer experience, while the convenience of digital wallets paved the way for more online stores, the COVID-19 pandemic forced businesses to further adopt cashless and touchless payment modes. 

Consumers today prefer to shop from the convenience of their homes with just a few clicks. As predictions say, 21.2% of total retail sales will happen online by 2024. 

Reflecting global trends, the UAE has seen a surge in mobile payments and e-wallet adoption. Driven by a tech-savvy population and initiatives like Dubai's Smart City project, mobile payments have become a staple in the region's bustling commerce.

The Emergence of Cryptocurrencies and Blockchain

While digital wallets and online payment have now stayed for many years and continue to offer a safe and convenient mode of transaction, the development of new technology is making way for new payment options. Bitcoins and cryptocurrency are emerging as powerful financial currencies that merchants can transfer between one another without the involvement of banks. Such a decentralized transaction mode has both its pros and cons. Some of these include:

Advantage of cryptocurrency 

Since no banks or intermediaries are involved, it eliminates the possibility of a single point of failure.

Decentralized transactions are secured by public and private keys, along with different incentive systems.

Cryptocurrency transfer is faster than traditional systems as no intermediaries are involved.

Cryptocurrency investment can earn you profit as the market grows. It’s valued at USD 680 billion as of November 2023. 

Disadvantage of cryptocurrency

Though cryptocurrency claims to be an anonymous form of transaction, certain agencies like the FBI can follow the digital trail.

Cryptocurrency is often used for malpractices. For example, hackers prefer cryptocurrency for ransomware. 

Although its transaction is decentralized, in reality, the ownership is highly concentrated. There are roughly 100 addresses that circulate 15% of the total value of Bitcoin. 

The Future of Payments: Towards a Cashless Society

If we look back to the history of the evolution of online payments, it’s only logical to predict that we’re slowly heading toward a cashless society. Although it might take some time to become completely cashless, it’s a fact that we’re slowly progressing toward becoming a cashless society. As technologies like AI, biometrics, and contactless transactions evolve along with the changing customer behavior, a cashless society is what looks the most logical next step. 

While we still can't predict where we will be in 2030 or 2060 in terms of cash, near-term projection sees a continuous decline in cash transactions. Cash projection in North America is only 8.7% by 2024. 

So, coming to the most pertaining question, if we are going to be a cashless society — the answer is a yes and a no. While many countries are heading fast towards embracing a cashless society, some countries will still be using cash transactions at least for the next few years. 

Conclusion

From barter systems to modern-day bitcoins, payment methods have been evolving steadily with the evolution of mankind. As new technology has come into existence, it has added new payment methods to the system, which has greatly influenced buyer behavior. 

The buyer who once couldn’t think of going out of the house without carrying their wallet can now comfortably go out with their smartphone, do shopping, and pay bills for their dinner. 

While we are steadily heading towards a cashless society, only time and technology will define what's in store for the future of payment and if we will ever become a completely cashless society.

Gautham Gopakumaran
|
5 min read
January 29, 2024
|
Cashless Payments

Cybersecurity in Digital Payments

Staying Ahead of Threats
Learn about the importance of cybersecurity in digital payments and the best practices to follow for reducing threats.

According to JP Morgan, 30% of companies have reported an increase in digital payment frauds. 

With the internet, businesses have revolutionized the way they collect customer payments. But not far behind are hackers/ miscreants who have made the internet an unsafe place, with increasing fraud and security breaches. 

In this post, we look into why cybersecurity is important for businesses setting up online payments and the best practices we recommend following. 

Why is cybersecurity important for online payments? 

Whether you’re a business or a consumer, keeping your data secure is crucial. But here’s why cybersecurity measures in online payments are even more important: 

1. To protect sensitive information

A typical financial services employee has access to 11 million files. Unfortunately, online transactions are susceptible to hackers. They are highly motivated by money to acquire data, especially personal banking information. Vulnerable systems are at high risk, which can lead to disastrous consequences for businesses and individuals. To protect sensitive data, cybersecurity in digital payments become crucial. 

2. To prevent fraud 

Money laundering, identity theft, and fraud are common concerns in online transactions. With machine learning and fraud detection mechanisms, cybersecurity programs can analyse transaction patterns for suspicious activity. This helps prevent theft/fraud in real-time.

3. To prevent hefty fines and legal repercussions

With online transactions, customers trust businesses to keep their data (card/bank details) safe. All merchants need to comply with payment industry requirements, such as PCI DSS, to ensure customer protection. If your business operates in the European Union, you have to comply with PSD2 Strong Customer Authentication (SCA). Multi-factor authentication helps reduce theft or fraud. As a business, if you fail to comply with these legal requirements, it could put you at risk of:

  • Compensating victims for damages, if necessary 
  • Expenses related to litigation
  • Hefty fines by governing authorities 

4. Reduce chargebacks 

Most chargebacks occur when a cardholder disputes a charge/ transaction on their account. They may not recognize the charge and believe it to be fraudulent, hence demand a refund from their bank. This is especially common in online transactions. 

Secure payment gateways can help reduce fraudulent chargebacks by verifying the identity of the cardholder, saving you from financial losses and chargeback fees. 

5. Positioning as a global business

There is the lack of uniformity in cross-border regulations. Different countries have different legal frameworks and security standards or regulations; that need to be catered to. By implementing secure payment gateways, compliant with multiple countries, businesses can have a worldwide target audience.

6. Protect your reputation

When Uber was hit by a data breach in 2016, the customer perception dropped by 141%. Data breaches lead to customer distrust and negative publicity. Brand reputation reigns supreme for all business. Enterprise organizations sometimes spend millions of dollars to build their brand image. If one single data breach could put all that effort down the drain, you begin to see the importance of cybersecurity for all payment infrastructure. 

What are the best practices for securing online transactions?

Here are some of the best practices we recommend to brands setting up cashless payment modes: 

1. Understand your PCI compliance requirements

In 2004, four major credit-card providers — American Express, Visa, MasterCard, and Discover, created The PCI Security Standards Council. Today, the PCI-DSS standard is a set of policies that govern how sensitive cardholder information should be handled

In the simplest of terms, no business must be able to see or access the customers’ card data. For this certain things need to be in place including: 

  • Data encryption during transmission
  • Restrictions on access to information 
  • Robust firewalls and updated software and spyware. 
  • Prevent default credentials and allow customers to change credentials easily. 

2. Data encryption with SSL and TLS protocols

Any online transaction requires the customer to share credit/debit card numbers, expiration dates, and CVV. Without proper data encryption, this data could easily be hacked. 

Data encryption protocols including TLS (Transport Layer Security) and SSL (Secure Sockets Layer) can be used to encrypt data. TLS is a cryptographic security protocol that emerged from SSL, but can be considered as an upgrade for data privacy, security and authentication. 

All SSL-certified websites have “https://” or a padlock icon which denotes a secure e-payment system. With the TLS encryption in place, the sensitive information is only transferred to the intended recipient. By authenticating the server, it prevents attackers from getting access to the data. 

3. Implement 3D Secure 2

3D Secure 2 (3DS2) is used to authenticate online transactions by verifying a customer’s identity. It serves as an additional layer of authentication to make sure that a legitimate cardholder is conducting a transaction.

Here, the cardholder needs a one-time password, or fingerprint or facial recognition. This helps to prevent fraud and unauthorized transactions.

While it creates extra steps during the checkout process, for the first time — subsequent transactions at the same merchant do not require extra authentication (if approved by the card holder) 

Additionally, 3DS2 prevents false declines by providing detailed data about the transaction. This helps both businesses and customers, preventing costly mistakes.

4. Deploy multi- or two-factor authentication

Multi-factor authentication (MFA) and two-factor authentication (2FA) are customer-facing authentication processes to verify the identity of users before processing payments. This is divided into two levels of authentication: 

  1. What the user knows - Net banking or card details 
  2. What the user has - OTP, PIN or CVV. 

Multi Factor Authentication requires three or more different authentication factors in order to authorize a payment. Apart from the two, the third authentication step could be something they are (biometric data). For example in a password, a one-time code generated by an app and a fingerprint scan. 

The more factors used makes it much harder for any miscreant to access an account, even with access to the user's password.

5. Ask for Card Verification Value (CVV) 

Card Verification Value (CVV) is a three/four digit code on the back of credit cards. It helps verify the identity of a card holder during online transactions. 

In a data breach, the CVV is unlikely to be stolen since it is not embossed or stored on the magnetic stripe or chip of the card. 

6. Incorporate payment tokenization

Tokenization replaces the 16-digit card number with a digital identifier known as a ‘token’. It helps to protect the original data, while letting payment gateways initiate secure payment.

Payment tokenization helps in: 

  • Protecting sensitive payment information from being intercepted or stolen during a data breach. 
  • Helps businesses comply with regulations and legal standards, like PCI DSS and the General Data Protection Regulation (GDPR). 
  • Customers don’t need to repeatedly enter payment information for recurring payments or subscriptions, which improves the customer experience and lowers abandonment rates. 

7. Maintain security of the website 

To ensure customer safety, businesses need to keep the website, content management system (CMS), and online payments secure. Here’s how: 

  • Regularly update your website, CMS software and plugins or extensions, to patch security vulnerabilities
  • Only accept strong passwords from the customers with certain pre qualifications like capital letters, special characters, numbers etc. 
  • Use a firewall to prevent unauthorized access and to block any suspicious traffic. Deploy monitoring and fraud detection tools to detect and respond to suspicious activity on your website. 

8. Train your employees

Take appropriate steps to train employees about potential threats and steps for action. Set up sessions on data protection guidelines, multiple security measures and protocols, phishing and more. Make sure your employees understand the importance of online payment security through audits; and encourage immediate reporting of any suspicious activities.

9. Inform your customers

Make an effort to promote the data protection procedures to your customers. It is not only about providing features, but ensuring that your customers know and implement on their end; to truly make the whole process secure. 

Conclusion 

Cybersecurity is a growing concern for all businesses. Hence it is important to choose an end-to-end payment solution built with features and compliances built for high security.

PayBy digital payment solutions come with robust fraud detection and prevention mechanisms integrated into the systems. The solutions leverage AI-based fraud monitoring, 3D secure authentication and transaction risk analysis to ensure your approval rates are not impacted by cyber threats. 

Want to know more? Book a demo of PayBy today.

Gautham Gopakumaran
|
5 min read
January 15, 2024
|
Cashless Payments, Cybersecurity

Digital Wallets Explained

Convenience at Your Fingertips
Learn all about what digital wallets are, the benefits of digital wallets for businesses and their role in the future of cashless transactions.

Today, we live in an increasingly cashless world. With the rise of e-commerce and mobile payments, consumers now expect the ability to pay from anywhere, at any time. No longer do we need to carry wads of cash or even plastic cards. Now we can pay with just a tap or click of our mobile phones. 

This seamless, digital payment experience is made possible by digital wallets. 

Did you know in 2022, UAE digital wallet market was valued at USD 3638.21 million, and is anticipated to grow with CAGR 12.12% for next 5 years.

Chart Image
UAE Mobile Wallet Market

Source 

Digital wallets represent the future of payments and in this post, we look into why e-commerce is not the only industry that needs to be prepared for this change. 

What are Digital Wallets?

A digital wallet is a software application or digital service that allows users to store payment information and/or money digitally for transactions. Rather than using physical wallets to carry cash and cards, digital wallets allow users to pay via their mobile device or the web.

Some popular examples of digital wallets in the UAE include:

  • PayBy 
  • Payit
  • e& money by Etisalat
  • Apple Pay
  • Google Pay
  • Samsung Pay
  • PayPal
  • Careem Pay
  • AliPay+
  • CashPay

These digital wallet apps and services securely store money, payment methods like debit/credit cards, bank accounts, and gift cards. Users can easily access their stored payment methods to checkout online or tap-to-pay at contactless terminals in stores. 

Leading digital wallets utilize tokenization for added security, generating digital tokens to represent your actual payment details.

What are the benefits of digital wallets for businesses? 

Digital wallets offer several key benefits for merchants and businesses. By accepting digital wallet payments, companies can increase sales, reduce fees, and gain customer insights.

Increased Sales

The ease and convenience of paying via digital wallet encourages customers to make more purchases. Studies show that when businesses accept mobile wallet payments, average transaction values and purchase frequency increases. Customers are more likely to make impulse buys and repeat purchases when checkout is quick and seamless.

Lower Transaction Fees 

Processing digital wallet transactions is less expensive compared to traditional payment methods. Credit card processing fees average 2-3%, while digital wallet fees are around 1%. For small transaction amounts, digital wallets can be nearly fee-free. These savings quickly add up for merchants with high volume.

Improved Customer Analytics

Digital wallets provide richer customer data than credit cards or cash. They allow businesses to track accurate transaction histories and purchasing habits. Companies can use these insights to better understand customers, personalize offers, and boost engagement through loyalty programs. The enhanced analytics lead to stronger customer relationships.

What are the benefits of digital wallets for customers? 

Digital wallets provide several key benefits for customers looking to make purchases and payments on the go. Compared to cash or physical credit cards, digital wallets enhance convenience, security, rewards programs, and accessibility.

Convenience

Digital wallets allow customers to check out faster, both online and in stores. Instead of fumbling for the cards in your wallet, you can pay with your smartphone in just a few taps. Digital wallets also store payment information, shipping addresses, and more to expedite the checkout process. Customers can breeze through checkout without needing to input tons of information.

Many digital wallets also support contactless payments through NFC technology. You can hold your phone near a payment terminal to pay almost instantly. This is much faster than chip/swipe payments or handling cash.

Security 

Digital wallets utilize encryption, tokenization, and other security measures to protect your data. This makes them generally more secure than physical payment methods. If your phone is lost or stolen, you can remotely disable the digital wallet to prevent unauthorized access.

Many digital wallets also support biometric login with fingerprints or facial recognition. This prevents thieves from accessing your wallet even if they steal your phone.

Rewards

Digital wallets often integrate with merchant loyalty programs and credit card rewards. Customers can store their memberships and earn points, miles, and cash back through the wallet. Rewards are applied instantly when you pay with a digital wallet.

Accessibility

Digital wallets centralize all your payment methods in one place. Customers can easily switch between credit cards, gift cards, coupons, and debit cards as needed. Everything is available right from your smartphone for maximum convenience and flexibility.

The Future of Digital Wallets

The future looks bright for digital wallets as more people embrace contactless payments and new integrations expand functionality.

Increasing Adoption of Contactless Payments

Contactless payments are on the rise globally. Digital wallets like Apple Pay, Google Pay, and Samsung Pay have helped accelerate consumer adoption of tap-to-pay. The COVID-19 pandemic further demonstrated the appeal of touchless transactions for safety and convenience. Surveys show a majority of consumers will keep using contactless even after the pandemic, indicating it is here to stay.

Integration with IoT Devices

As the Internet of Things expands, digital wallets may integrate with connected devices like cars, appliances, and smart home systems. For example, your digital wallet could automatically pay tolls while driving or manage payments for an autonomous vehicle. Appliances could automatically reorder and pay for consumables like detergent. And smart home hubs could draw from your digital wallet to pay for services like energy use.

Cryptocurrency Support

Some digital wallets already enable storing and spending cryptocurrency like Bitcoin. As cryptocurrency gains mainstream adoption, support within digital wallets is likely to grow. This will make it easier for average consumers to use cryptocurrency for everyday transactions. And integration with digital wallets provides a more familiar user experience compared to standalone crypto wallets.

Wrapping up!

Digital wallets have completely changed the game when it comes to convenience and ease of making payments. With a digital wallet linked to your debit or credit card, you can make quick and easy payments anywhere with just a tap or scan of your phone. There's no more fumbling for cash or cards. 

The benefits of digital wallets are numerous - they save time, provide security, allow you to track spending, and work across platforms and devices. As more retailers and services adopt digital wallet payments, consumers will find paying for anything from a coffee to a cab ride is just a couple of taps away.

The future is all about streamlined, integrated digital experiences, and digital wallets fit right into that vision. Payments are frictionless yet secure. Transactions become embedded into platforms and apps rather than separate experiences. As money becomes more digital, digital wallets will continue leading the way.

For those looking for the ultimate payment convenience coupled with next-generation financial tools like digital wallets, PayBy is the solution you’re looking for. 

PayBy delivers the future of payments today. Consumers get the convenience they demand while businesses get the advanced tools they need - it's a win-win for all. 

Want to know more? Book a demo of PayBy today.

Gautham Gopakumaran
|
5 min read
January 8, 2024
|
Digital Wallets, Cashless Payments

Top 9 Benefits of Switching to Digital Receipts in 2024

Discover the top 9 benefits of switching to digital receipts in 2024, from saving money and promoting sustainability to enhancing customer satisfaction and retention.

Receipts are important for business and customers, since they act as proof of financial transactions. 

The bad news: They have a nasty habit of getting lost or damaged, when you need them; or turning up in an old jeans pocket when you least expect it. 

The good news: Digital Receipts!

Irrespective of the business size or type, digital receipts are transforming retail marketing, and it’s time for your business to jump on the bandwagon. 

In this post, we’ll tell you why. 

What are the benefits of using digital receipts? 

You may already have a record of all the transactions on your point of sale or bookkeeping system. But here’s why we still recommend setting up digital receipts: 

1. Saves money 

There are more than 300 billion receipts printed each year. Apart from the environmental damage, businesses need to shell out thousands of dollars on thermal paper, ink cartridges, printers, and more. 

Digital receipts are far less expensive and reduce overhead operating costs. All you need is a Payment Service Provider like PayBy to automate creating and sharing them. 

2. Promotes sustainability 

Since the figures are burned and not printed on the surface, paper receipts cannot be recycled. Moreover, the production and disposal of receipt paper emits the carbon equivalent of over 471,000 cars on the road.

In the early 2000s, before retail mobile apps and email marketing, only the Apple Store and a few startups pushed digital receipts as part of the growing sustainability movement. Today, the  benefits of eco-friendly receipts are widely understood. 

For example - A report by Green America showed how a single Walgreens-sized company could save over 55,000 trees, 58.8 million gallons of water, and 17.6 million pounds of CO2 emissions annually by ditching paper receipts. 

3. Enhances customer satisfaction

Digital receipts also create an opportunity to follow up with customers and collect feedback on their experiences and purchases. 

Knowing their purchase details (like product, offers available, etc.,) and the support salesperson can be instrumental while analyzing customer feedback. It helps you see how your business is doing in real-time; improving overall strategy and enhancing customer experience.

4. Facilitates hassle-free tax season

Paper receipts need to be hunted for, sorted and then organized during the tax season. This is both time consuming and prone to human errors while recording spends and expenses. 

Digital receipts can be stored on the cloud, which is easily accessible during tax season. There is no risk of losing or throwing digital receipts away, so you won’t have to deal with books that don’t balance at the end of each month. 

When you use a payments solution like PayBy, you can record all digital receipts by integrating it with the bookkeeping software or tax filing systems. 

5. Eases post-purchase interaction 

Customers prefer digital receipts because, unlike thermal paper receipts, they don’t fade or get lost. This helps in post purchase interactions like return, exchange, warranty or alteration. 

For a business, digital receipts can act as proof to check the validity of requests being made and to tally transaction records. 

6. Boosts customer engagement 

Business owners should focus on consumer relationships that extend beyond transactional communications. With digital receipts, you get access to your customers’ contact information to create email and SMS lists. This can be useful for product launches, special offers, or educational content about the product/service. 

You can also embed links to the website, social media handles and loyalty programs to create avenues to establish stronger relationships with your customers. 

7. Creates upsell and cross-sell opportunities 

76% of customers get frustrated without a personalized experience with a brand. With digital receipts, you have access to the data at the transaction level. This can help you recommend complimentary or similar products/ services to the purchase; and add discounts/offers to sweeten the deal. 

With tailored content, you can drive higher repeat purchases and boost the overall CLTV, leading to greater business profits. 

8. Improves customer retention

With customer acquisition costs increasing by the day, marketing efforts need to encompass customer retention. The data gathered through digital receipts can be used to identify top customers and their purchase behavior - including preferred products, purchase power, purchase frequency and more. 

This can further help you segment and tailor the communication with customers, improving the retention rate. 

9. Protects your employees and customers

Approximately 93% of paper receipts are coated with Bisphenol-A (BPA) or Bisphenol-S (BPS). They could lead to fetal development issues, type 2 diabetes, thyroid conditions, reproductive impairment, and other health concerns.

Unfortunately, employees who manage the point of sale have regular contact with receipts and have over 30% more BPA or BPS found in their bodies; putting them at risk. A shift to no-contact digital receipts protects both employees and frequent shoppers. 

Conclusion 

The benefits of digital receipts are countless, and is a reminder that we need to continue replacing outdated, wasteful processes, with innovative solutions. 

Forward-thinking businesses must move towards paperless options - no matter what the industry. 

With comprehensive payment solutions like PayBy, it is also easy for businesses to get started with digital receipts. From the online payment gateway to the point of sale systems and scan-to-pay QR codes, PayBy enables you to automate sending branded digital receipts to customers via email and SMS without switching tools. 

Ready to track and record transactions more efficiently? Learn more about Digital Receipts or book a demo today.

Gautham Gopakumaran
|
5 min read
December 26, 2023
|
Digital Receipts

7 Reasons you Should Introduce Cashless Payment Systems

Learn why your business should embrace cashless payments and how to get started to enhance customer experience.

Cash is no longer king. 

30 years ago, a world without cash was not possible. But, over the years, businesses have realized that dependency on cash can be tricky and risky. 

From not being able to record every transaction to theft/fraud or even providing change to the customer, businesses need better solutions.  Whether you are a small, mid or enterprise based business, cashless payment systems are the future to improve business efficiency. 

In this post, we look into the leading reasons why businesses of scale can be seen adopting cashless payment systems. 

What are Cashless Payment Systems? 

Payment transactions that occur without physical exchange of money are referred to as cashless payments. 

They can be conducted online and in-stores via a point of sale (POS). Both, the payer and the receiver, use digital mediums to exchange money. This includes payments via direct bank transfers, credit/ debit cards, digital wallets, online payment portals and similar transaction modes. 

Why should businesses switch to cashless payment systems?

Cashless payments have widened the opportunities for businesses to enhance the customer experience offered and take control of their finances. Here are some of the leading reasons why businesses have been quick to embrace this change: 

1. Helps increase sales and revenue

‘Swipe, Tap or Scan’ has become extremely common as we move towards a cashless society. Customers prefer to carry their phone or credit/debit cards rather than the cumbersome wallet filled with cash.

Businesses that only accept cash, inadvertently limit sales. Numerous and frictionless payment methods allow people to spend easily. When paying digitalls, customers tend to spend more, leading to higher revenue. 

2. Helps increases convenience and saves time

Cashless payment systems save time. They can be 6x faster when compared to cash transactions, reducing the average transaction time from 90 seconds, to just 15 seconds. 

Shorter lines encourage people to buy that extra drink or shirt, resulting in a positive customer experience and retention. When Atlanta’s Mercedes-Benz Stadium went cashfree, there was a combined 16% increase in food and beverage spending at Atlanta Falcons and Atlanta United games. 

This leads to improved revenue and higher customer lifetime value amongst customers. 

For business owners, in-store cashless payments allow tracking of incoming and outgoing funds. This saves time and comes handy while filing returns.

3. Helps analyze data and generate insights

With cashless payment systems, you can gain insights into your business, to make informed decisions about evolving needs and preferences. 

All transactions can be used to segment your customers, based on payment volume or payment type in specific periods. 

Data helps understand your customers preference and behavior patterns. This knowledge leads to targeted product launches, offers and overall customer satisfaction. 

4. Helps with increased security during transactions

Cybersecurity in cashless payments, has taken off one more worry off the consumer and retailer. Cashless payment solutions help eliminate the risk of theft or fraud. Here’s how: 

  • Digital transactions are secured with varying levels of encryption and data authentication
  • With most payment modes, enabling two-factor authentication (TFA) adds an extra layer of security 
  • Customers can activate geo-blocking features that restrict transactions in certain countries to prevent fraud
  • All data collected from digital transactions is protected against use by third parties. No personal information can be disclosed without permission
  • All digital transaction methods provide SMS and email notifications; and statements for users to track their funds 

5. Helps to lower operating expenses


Cash management is neither easy nor cheap. 

Storing, transporting and depositing cash funds is a task by itself. Moreover, you need additional training for employees to manage cash payments — and you cannot discount the scope of human error. Building additional security to keep your funds safe like lockers, cameras, sometimes even armored trucks (when transporting huge amounts of money) is an expensive affair.

SMBs can cut unnecessary expenses with digital payment solutions. Bill Walsh, VP of Tampa Bay Rays, said “We’ve seen some pretty substantial operational savings from not having to manage a large footprint of cash in the building. The team saved $150,000 in operating and manpower costs.” 

6. Helps to enhance accounting accuracy and efficiency

Digital payments can increase transparency and streamline management. Digital transactions make accounting accurate and faster; as compared to manual efforts. 

For retailers, there is a clear paper trail, and no risk of vendors/employees under-reporting sales. Payments made by customers or to vendors can be easily tracked without sifting through physical records.

Cashless payment systems can reduce the time spent on accounting and reconciling at the end of the sales day, which allows you to focus on other aspects of the business. 

7. Improved customer experience for customers

Based on the study by Visa, cashless payments, mainly via e-wallets (52%) and contactless card payments (44%), are growing rapidly. Customers prefer new payment methods such as Buy Now Pay Later (BNPL) solutions (63%). 

This is particularly evident in categories such as bill payments, supermarkets, retail shopping, purchases at convenience stores, and restaurants. 

Plus digital payment adoption offers benefits to consumers. These can be in the form of cashback, points, or vouchers. On the other hand, cash payments offer no such additional value, hence customers prefer making purchases via digital means. 

By enabling cashless payment systems, you improve the customer experience and the value gained from your business. This encourages shoppers to buy and stay with your brand rather than the competition. 

Conclusion 

The benefits of cashless transactions cannot be ignored. It has changed the way people conduct business around the world. From malls to restaurants and eCommerce stores, most businesses have opted for the smarter and efficient method of digital payment systems. 

The plus point is that it is not difficult to establish cashless payment solutions. 

With comprehensive payment solutions like PayBy, it is also easy for businesses to get started with cashless payment systems. From the smart point of sale systems and scan-to-pay QR codes or online gateways; all solutions are designed for businesses of different sizes with different needs, to grow and succeed. 

Book a demo today to know more.

Gautham Gopakumaran
|
5 min read
December 18, 2023
|
Cashless Payments

How does PayBy POS Help with Cash Management

Discover how PayBy POS revolutionizes cash management for businesses in 2024, offering secure, efficient, and integrated transaction solutions.

Efficient cash management stands as a cornerstone for sustainable growth and financial stability.

However, there are several challenges that businesses face in cash management, such as:

  • Handling physical cash poses security risks
  • Manual cash reconciliation can be time-consuming and error-prone
  • Lack of real-time visibility into cash flows complicates decision-making
  • Difficulty in tracking and managing multiple payment methods efficiently

Enter POS systems, a solution addressing these hurdles. 

POS systems combine hardware and software to facilitate sales, manage inventory, process payments, and generate transaction records for businesses' operational and financial management.

In this blog post, learn how the PayBy POS system emerges as a game-changer as it offers a comprehensive solution that simplifies and optimizes cash management processes.

Overview of PayBy POS System

PayBy POS system is a complete solution designed to streamline in-store cashless transactions, catering to various business sizes and needs. Its key features and functionalities span across three primary products:

1. Smart POS

Ideal for small to large merchants, it facilitates cashless payments, supports multiple modes of payment (including AliPay+, PayBy, and Botim wallets), and offers features like transaction tracking, multi-store management, advanced permission controls, and AI-enabled security.

2. Smart BOX

Tailored for SMEs, this portable solution seamlessly integrates with existing terminals, allowing QR code scanning via the PayBy consumer app for swift payments. It also boasts a robust security infrastructure.

3. QR code payments

A free POS solution designed for small businesses, enabling cashless payments without a physical device. Merchants can display a QR code for customers to scan and make payments using various methods like credit cards, debit cards, and multiple wallets.

Other features of PayBy

PayBy offers an array of features to set up cashless payments and accept all modes of payment across physical customer touchpoints. Here are some other PayBy POS features that make it a standout choice for businesses: 

Efficient Transaction Processing

  • Explain how PayBy POS streamlines transaction processing, reducing errors and wait times.
  • Highlight features like quick barcode scanning and easy payment processing.

Enhanced Security and Reduced Cash Handling Errors

  • Discuss the security features of PayBy POS, including secure payment processing and fraud prevention.
  • Explain how reduced cash handling minimizes errors and potential theft.

Simplifying Reconciliation and End-of-Day Reporting

  • Describe how PayBy POS simplifies the reconciliation process with accurate end-of-day reports.
  • Highlight the ease of matching sales data with bank deposits.

Integration with Accounting Software

  • Discuss how PayBy POS can integrate with accounting software for streamlined financial management.
  • Explain the benefits of this integration for maintaining accurate financial records.

1. Real-time tracking and reporting

Payby’s POS reporting tools provide real-time tracking of sales and transactions through a centralized dashboard, offering businesses immediate access to transaction data across various payment modes, including QR codes and other PayBy-supported methods. Here's a breakdown of how it achieves real-time transaction tracking:

  • Centralized dashboard: Merchants can access this dashboard to view and monitor transactions as they occur. It captures payments made through QR codes and other supported payment modes, allowing for a comprehensive overview of all sales activities.
  • Instant transaction updates: As transactions take place, the system updates the dashboard in real-time. This instantaneous reporting ensures that businesses have up-to-the-minute information on sales, revenue, and payment types, eliminating delays in accessing crucial financial data.
  • Comprehensive transaction details: The dashboard provides detailed transaction information, including transaction amounts, payment methods used, timestamps, and customer details where applicable. This level of granularity allows for thorough tracking and analysis of sales activities.

With access to such real-time data, businesses can make informed decisions promptly. Whether it's adjusting inventory levels, optimizing marketing strategies, or identifying high-performing products or services, real-time tracking facilitates agile decision-making.

2. Efficient transaction processing

PayBy POS system streamlines transaction processing by incorporating efficient features that minimize errors and wait times, ultimately enhancing the overall payment experience. Here's how it achieves this:

  • Quick barcode scanning: The system facilitates swift payment processing through QR code scanning and reduces transaction times significantly. Quick QR scanning and easy payment processing mean shorter queues and faster checkout experiences for customers. This not only enhances customer satisfaction but also optimizes business operations by increasing transaction throughput.

It also allows merchants to create unlimited QR codes without incurring additional costs. This feature allows seamless payment collection across different locations or touchpoints, enabling customers to make payments swiftly by scanning the code using their smartphones.

  • Easy payment processing: PayBy POS offers a user-friendly payment processing interface. Customers can choose from various payment modes supported by PayBy, including credit cards, debit cards, and multiple wallets. The interface is designed to be intuitive, ensuring a smooth payment experience for customers, reducing the likelihood of errors during the transaction process.
  • Customize payment collection: The ability to create unlimited QR codes allows businesses to have specific codes for different locations or products/services. This customized approach to payment collection simplifies accounting and reconciliation processes as transactions are recorded against specific codes, aiding in tracking sales by location or items. 

3. Enhanced security and reduced cash-handling errors

PayBy POS prioritizes security, implementing robust measures to ensure secure payment processing and prevent fraud. Here's an overview of its security features:

  • Secure payment processing: PayBy integrates with various payment modes, offering in-app payment solutions with optimized mobile pay pages and secure transaction interfaces. This integration ensures that transactions are conducted through a secure environment, protecting sensitive payment information from unauthorized access or interception.
  • Security password controls: PayBy implements security password control solutions provided by CFCA (China Financial Certification Authority) or similar reputable entities. These controls add an extra layer of security, ensuring that only authorized personnel can access sensitive system functionalities or perform specific actions, reducing the risk of internal breaches.
  • State-of-the-Art QR code encryption: PayBy utilizes state-of-the-art encryption techniques to secure scan-to-pay QR codes. This encryption ensures that QR codes used for transactions are tamper-resistant and cannot be duplicated or manipulated, thereby preventing fraudulent activities related to QR code payments.

4. Simplifying reconciliation and end-of-day reporting

PayBy POS streamlines the reconciliation process by offering accurate end-of-day reports and facilitating the matching of sales data with bank deposits. Here's how it simplifies these aspects:

  • Comprehensive end-of-day reports: The system generates detailed end-of-day reports that provide a comprehensive overview of all transactions processed during the day. These reports include sales data, payment methods used, transaction amounts, taxes, discounts, and other pertinent details. The accuracy and comprehensiveness of these reports aid in reconciling sales activities against bank deposits.
  • Real-time account receivables tracking: PayBy POS offers a real-time dashboard that tracks account receivables against invoices shared and paid. This dashboard provides immediate insights into the status of payments, allowing businesses to monitor outstanding invoices and payments received. This feature simplifies the reconciliation process by keeping track of pending payments and ensuring all transactions are accounted for.
  • Detailed invoices: Invoices generated by PayBy POS offer a detailed breakdown of expenses, including prices, taxes, discounts, and other relevant information. This level of detail ensures transparency in billing, enabling customers to understand their charges thoroughly. This detailed invoice breakdown makes it easier to match sales data with corresponding customer payments.

The system's analytics capabilities allow businesses to identify inactive customers, enabling targeted efforts to re-engage with them. Also, by detecting payment failures and addressing them swiftly, businesses can reduce customer churn and maintain a healthier customer base.

5. Integration with accounting software

PayBy POS offers seamless integration with accounting software through its easy-to-use API and robust compatibility with various CMS (Content Management System) platforms. Here's how this integration benefits businesses in maintaining accurate financial records:

  • Efficient data transfer: The integration allows for smooth and automatic transfer of transaction data from PayBy POS to accounting software. This eliminates the need for manual entry, reducing the risk of human errors and ensuring data accuracy.
  • Real-time updates: The integration enables real-time updates between the POS systems and accounting software. This means that as transactions occur, they are promptly reflected in the accounting records. Real-time synchronization ensures that financial data is always up-to-date and reflects the latest sales and payment information.
  • Streamlined reconciliation: Integrating PayBy POS with accounting software simplifies the reconciliation process. Matching sales data with bank deposits becomes more straightforward, as all transaction details, including payment methods, amounts, and taxes, seamlessly flow into the accounting system. This streamlines the reconciliation of sales records with financial statements.
  • Enhanced financial visibility: The integration provides a holistic view of financial data. Business owners and accountants gain comprehensive insights into sales, revenue, expenses, and other financial metrics within the accounting software. This comprehensive view allows for better financial analysis and decision-making.

Conclusion

Selecting one of the optimal POS systems is pivotal. The POS system provided by PayBy transforms cash management by offering real-time insights, secure transactions, streamlined reconciliation, and integration capabilities.

With no setup fees and one of the lowest transaction charges in the industry, the PayBy payment gateway also gives you more control over your finances.

Embrace the future of cash management—get started with PayBy POS today

FAQs

1. What are the 4 types of POS?

POS systems come in four primary types: mobile POS, cloud-based POS, terminal POS, and self-service kiosk POS. Each type caters to different business needs, offering flexibility, mobility, and varied functionalities to streamline transactions and enhance overall operational efficiency.

2. Why is the POS system used?

POS systems are integral for businesses to manage sales, inventory, and customer interactions effectively. They automate transactions, simplify inventory tracking, provide insights into sales trends, enhance customer experiences, and offer secure payment processing, ensuring smooth operations and informed decision-making for sustained growth.

3. What are the 6 functions of the POS?

POS systems encompass pivotal functions including transaction processing, inventory management, sales reporting, customer data tracking, employee management, and integration capabilities with other business software. These functions collectively optimize business operations.

Gautham Gopakumaran
|
5 min read
December 4, 2023
|
POS, Cashless Payments

Cashless Payment Benefits Across Industries in 2024

Discover how various industries are leveraging cashless payments for efficiency and growth in 2024. Embrace the digital payment revolution with PayBy.

The pervasive shift towards cashless payments is transforming the landscape of industries and businesses, irrespective of their size.

Source- Hubspot

Global cashless payment volumes are poised to surge by over 80% from 2020 to 2025, with a nearly threefold increase anticipated by 2030.

In this blog post, we see the key industries we are noticing embracing cashless payments with PayBy.

Which industries need cashless payments 

Numerous industries are adopting cashless payments, as digital transactions offer increased efficiency, convenience, and security. Here are some that are particularly benefiting from the shift: 

1. Information technology and services

In the Information Technology and Services sector, where digital transactions are commonplace, the integration of cashless payments aligns seamlessly with the nature of operations. The elimination of currency-related barriers and diverse banking systems through cashless payments streamlines exchanges, simplifying the overall transactional process. 

The adoption of digital payments brings about advantages in auditing, accounting, and financial reporting. It ensures compliance with regulatory standards while concurrently reducing manual errors in bookkeeping processes. The streamlined nature of cashless transactions accelerates payment processing, contributing to the expeditious flow of cash for businesses. 

IT and Services is one of those industries that are tech-savvy and can swiftly embrace new technologies and payment platforms. This adaptability enhances their competitiveness in the market, providing added value to clients through the facilitation of seamless financial transactions. 

2. Tourism and hotels

In Tourism and Hotels, the integration of cashless payments significantly simplifies transactions for both travelers and businesses involved in travel bookings, hotel stays, and related activities. 

Tourists benefit from the seamless ability to book accommodations, make reservations, and settle bills through digital payment methods, eliminating the inconveniences associated with currency exchange and physical cash handling. 

The adoption of digital payment systems in the tourism and hotel industry enables the collection of valuable data on guest preferences and spending patterns. This data becomes instrumental for hotels in personalizing services, offering targeted promotions, and creating effective loyalty programs.

The availability of diverse digital payment options further contributes to customer trust and loyalty, providing guests with peace of mind and convenience throughout their stays.

3. Fitness and wellness

Cashless payments simplify the entire financial landscape for both businesses and clients in the fitness and wellness industry. 

For gyms, wellness centers, and fitness classes, the adoption of cashless payments streamlines membership transactions, enabling members to effortlessly pay for subscriptions or sessions using digital methods. This ensures a consistent and secure revenue stream for businesses.

The elimination of the need for clients to carry cash or checks to fitness facilities is a significant advantage of digital payments in this context. 

Integrated digital payment systems also generate valuable data insights on client behaviors and preferences. Leveraging this data, fitness and wellness centers can tailor their services, offering personalized fitness plans and launching targeted marketing campaigns to drive business growth. 

Such cashless payments industries open avenues for implementing loyalty programs and flexible payment options, enhancing client loyalty and encouraging regular return visits for services or memberships.

4. Social product and service sellers

Digital payment methods play a crucial role in breaking down geographical barriers for social product & services sellers. They empower creators to engage with customers worldwide, eliminating the constraints associated with physical cash and local currencies. 

Buyers, in turn, benefit from the ease with which they can purchase digital content, artwork, or services with just a few clicks. This accessibility not only encourages impulse buying but also eliminates the inconveniences often associated with traditional payment methods.

This electronic payments industry also offers robust encryption and fraud protection protocols. These security measures safeguard both the seller's income and the buyer's financial information, fostering a sense of trust between the parties involved. 

5. Restaurants and cafes

In restaurants & cafes, minimizing cash handling emerges as a crucial aspect, mitigating the risks associated with errors in change and the potential for theft. This not only creates a more secure environment for both employees and patrons but also streamlines the financial processes within the establishment. 

Establishments leveraging cashless payments often adopt innovative technologies, such as table-side ordering through apps, self-checkout kiosks, and loyalty programs linked to digital wallets. This not only fosters a more tech-savvy and competitive edge but also reflects a commitment to meeting the evolving expectations of customers.

Offering various cashless payment methods caters to diverse customer preferences, incorporating contactless payments, mobile wallets, and online ordering systems that align with modern consumer behaviors and further streamline the dining experience.

6. Hospital and healthcare

Integrated payment systems within hospitals & healthcare settings extend their impact by facilitating seamless integration with electronic health records (EHRs) and insurance platforms. This integration, in turn, streamlines claims processing and ensures the accurate documentation of financial transactions. Moreover, cashless payments serve as a fundamental enabler for telehealth services, allowing patients to conveniently pay for virtual consultations or remote monitoring services.

7. Gaming, betting and casinos 

Players now have the convenience of seamlessly loading funds into their gaming or betting platforms through various digital payment methods, eliminating the need for handling physical cash and providing speed in placing bets or playing games.

Beyond security, cashless payments enable better control and management of funds, allowing players to monitor their spending, set limits, and track gaming expenses more effectively through digital payment systems, promoting responsible gambling practices.

The advantages extend to swift and secure payouts for winnings, as players receive their earnings directly into their digital wallets or bank accounts. This eliminates the delays and complexities associated with traditional cash payouts. 

8. Insurance

Digital payment systems bring efficiency to the claims process for both insurance providers and policyholders. Claims can be filed and settled digitally, reducing paperwork, minimizing processing times, and facilitating faster disbursement of claim amounts. 

Also, digital platforms empower policyholders to easily access their policy details, make necessary changes, and communicate seamlessly with insurers, enhancing overall transparency and responsiveness in the insurance relationship.

Beyond convenience and efficiency, digital transactions in this industry ensures robust security measures against fraud and unauthorized access. 

Insurance companies can implement advanced technologies such as multi-factor authentication and encryption protocols to safeguard policyholder data, thus preventing fraudulent activities and enhancing the overall security of the insurance ecosystem.

How can PayBy help?

PayBy offers a comprehensive suite of cashless payment solutions that can be tailored to meet the industry's diverse and complex transaction requirements.

PayBy payment solutions offer features such as: 

  • Multiple payment modes (Credit cards, Debit Cards, Digital wallets & Bank Transfers)
  • Custom payment options (Subscription-based payments, One-time payments & Optimized payment experience)
  • Transaction monitoring and management (Payment tracking dashboard, Digital receipts, Detailed reports and insights & Record seasonal fluctuations)
  • User permissions and control
  • Automated payouts (Monitor payout status, No delay in bulk processing)
  • Security and Compliance

Conclusion 

In this digitally woke era, the demand for streamlined cashless payment solutions reigns supreme. When it comes to selecting an ideal payment system for your industry, it should offer easy setup, seamless integration with existing tools, and robust transaction tracking capabilities. 

PayBy transforms digital payments by offering real-time insights, secure transactions, streamlined reconciliation, and integration capabilities.

With no setup fees and one of the lowest transaction charges in the industry, the PayBy payment gateway also gives you more control over your finances.

Embrace the cashless system advantages—get started with PayBy today

FAQs

1. What are the benefits of a cashless economy?

A cashless economy offers heightened efficiency, transparency, and convenience in financial transactions, fostering economic growth. The cashless payments industries witnesses increased speed, reduced costs, and improved record-keeping, streamlining financial interactions for businesses and individuals alike.

2. Why is cashless payment safer?

Cashless payments industries enhance safety by minimizing the risk of theft and fraud. Digital transactions offer secure encryption, authentication protocols, and real-time monitoring, ensuring a protected financial ecosystem with reduced physical vulnerability compared to traditional cash transactions.

3. What is an example of a cashless transaction?

A typical example of a cashless transaction is using mobile payment apps to pay for goods and services, exemplifying the growing influence of cashless payments industries in modern economies.

Gautham Gopakumaran
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5 min read
November 27, 2023
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Cashless Payments