For many decades, working 9 to 5 was the general norm. However, in 2024, the scenario is not the same anymore. A new buzzword in the job market is the "gig economy."

The gig economy refers to the workforce of people who make a living through freelancing and side hustle work.

The gig economy culture is rising globally, and the scene is no different in the MENA region. According to an analysis by recruitment agency Outsized, the region is witnessing the fastest gig economy growth, with freelance registration jumping by 142% from 2022 to 2023.

While many factors influence this trend, payment gateways have a direct role in reshaping the gig economy.

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Role of Payment Gateways in the Gig Economy for Gig Workers

While in a traditional setup, an employee receives payment/salary once a month, the whole payment system for the gig economy works differently. Gig workers get paid every day/week/month depending upon the terms agreed with their respective clients.

Plus, gig workers can pick up work from any geography, which means different currencies are involved. Payment gateways make it convenient both for businesses and gig workers. Let's see how.

1. Facilitating Smooth and Timely Transactions

To build a sustainable freelance business, gig workers must have access to fast and reliable payment methods. Payment gateways just fit right because, with payment gateways, automated processes ensure faster transactions than manual processing.

Some popular payment gateways gig workers often use are PayPal, Stripe, Square, Wise, etc. Most of these payment gateways support multi-currency transactions, so freelancers working with international clients can get paid more efficiently.

Getting paid on time is crucial for every gig worker because it honors the commitment. This ensures that freelancers can rely on consistent income to support their livelihoods while building trust and credibility with their clients. Payment gateways just fulfill this requirement.

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2. Ensuring Secure Payments

With the rise of the gig economy, digital payments are accelerating. But at the same time, payment frauds are on the rise, too. A news report mentions that 54% of UAE customers have been fraud victims at least once. Data breaches and fraudulent transactions are leading to financial losses for gig workers.

So, what you can do?

Leveraging a payment gateway that has invested in a robust security system is a logical measure to safeguard gig workers. Payment gateways like PayBy offer end-to-end communication encryption using TLS and SSL Protocols, CFCA security password control solutions, AI-based fraud monitoring, and 3D secure authentication.

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3. Reducing Administrative Burdens

Apart from doing client work, gig workers also need to manage many administrative tasks, such as networking with prospective clients, managing invoices, tracking payments, and managing their taxes.

As gig workers expand their businesses, keeping track of multiple invoice statuses and following up on payments becomes difficult.

A payment gateway solution can help reduce their administrative burden by automating invoices and tracking payments. For example, PayBy offers automated payout solutions that streamline operations and records. So, gig workers can directly receive money in their bank accounts with no delay.

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4. Enhancing Financial Inclusion

Payment gateways enhance the financial inclusion of unbanked and underbanked gig workers who can still receive payments through these gateways.

This financial inclusion gives gig workers the freedom to choose their clients internationally and not just remain restricted to domestic clients. Alternative payment solutions like mobile payments and digital wallets give gig workers better accessibility, and their financial freedom is not just restricted to their local banks.

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5. Boosting Trust and Transparency

Payment gateways help build trust and transparency through secure payment processing. In addition to implementing a secure payment processing system, many payment gateways have implemented dispute resolution mechanisms for payment-related issues.

For example, when a payment gateway offers a detailed transaction record, it automatically enhances transparency and accountability, which fosters trust among gig workers.

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6. Innovative Features and Services

Gig workers always seek a good payment experience, which often translates to faster payments. Faster payments mean a sustainable source of income that can pay the bills and bring peace of mind to the gig worker.

Payment gateways have made instant payouts and on-demand payment options possible, which means gig workers can receive real-time funds often unsupported by many traditional banks.

Additionally, these payment gateways support multi-currency conversion, facilitating international transactions.

Many gig workers work on different freelance platforms and are paid through these platforms. Payment gateways can easily integrate with these gig platforms and marketplaces, making a seamless payment experience for all.

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7. Navigating Challenges

As gig workers work with multiple clients globally, tackling compliance issues becomes critical. 

Payment gateways like PayBy mitigate such challenges early on. For example, PayBy ensures compliance with industry standards while handling payment data.

In addition to navigating regulatory and compliance issues, payment gateways minimize transaction fees so that gig workers don't lose money with every transaction. 

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Role of Payment Gateways in the Gig Economy for Employers 

Employers who regularly work with gig workers can benefit from adopting payment gateways in multiple ways. Here's how. 

1. Streamlined Payment Processes

Employers who work with multiple gig workers can benefit from using payment gateways. For example, by partnering with PayBy, employers can simplify payroll management as it streamlines operations and records. You can directly transfer payments to their bank accounts or wallets, monitor the payout status, and process invoices in bulk.

The automation feature of payment gateways helps reduce time spent on manual processing and administrative workload. Since payments are automated, you can schedule them, ensuring workers are paid on time. This will help build trust and retain your gig workers.

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2. Improved Financial Management

One of the biggest benefits for employers using payment gateways is that they can easily integrate with their existing accounting and financial software, allowing them to track their finances.

For example, PayBy easily integrates with different apps, minimizing disruption to ongoing operations. It gives real-time access to all the transaction data and financial reports that ease budgeting and financial forecasting while maintaining all payment records accurately.

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3. Enhanced Security and Fraud Prevention

Payment gateways like PayBy make every transaction safe with enhanced security and fraud prevention features. For example, PayBy has invested in AI-based fraud monitoring, 3D secure authentication, transaction risk analysis, encryption, and tokenization to ensure safety.

While such preventive measures reduce the risk of payment fraud and financial loss, they also help build trust with workers through secure payment practices. These measures ensure the gig workers' hard-earned money is in safe hands, which helps build long-term relationships with the employer.

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4. Cost Efficiency

High transaction fees often concern employers and gig workers when working internationally. For example, a traditional bank in the UAE charges a 2.99% foreign transaction fee, whereas PayBy charges 2.5% for domestic transactions and 2.8% for international transactions.

Compared to traditional banks, payment gateways reduce the administrative costs associated with manual payment processing. Moreover, different payment gateways have different competitive pricing plans that help employers save money on each transaction.

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5. Flexibility and Scalability

Different gig workers have different payment requirements and preferred currencies in which they want to be paid. Working with a payment gateway solution makes managing these varying payment needs easy, especially when your business grows, and you start working with multiple gig workers.

With payment gateways, you can choose different payment methods, such as bank transfers, digital wallets, credit cards, QR code payments, etc., to accommodate the preferences of different gig workers.

Plus, it can easily integrate with your existing accounting software, so your finance team can monitor every transaction and maintain the books without hassle.

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6. Global Reach

One of the main reasons employers work with gig workers is their access to the global talent pool.

However, traditionally, paying international workers is not easy. You must approach the bank, follow the paperwork, check the conversion rate, and pay a huge transaction fee. Moreover, traditional bank transfers can take several days, delaying the payment cycle.

Payment gateways facilitate paying international workers easily. These platforms support multi-currency transactions with automatic currency conversion. The payments can happen in real time while staying compliant with the local regulations and payment standards in different countries.

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7. Enhanced Worker Satisfaction and Retention

Timely payment is of utmost importance for gig workers to build a sustainable business. Not paying gig workers on time can turn the relationship sour, forcing them to leave you and look for work elsewhere.

However, with a reliable payment gateway solution, you can ensure timely payments for your gig workers. A better payment experience would bring peace of mind and improve worker satisfaction and loyalty.

Additionally, every payment gateway offers a transparent transaction history that further helps to reduce disputes and build trust.

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8. Data Insights and Analytics

Apart from easy payment processing, payment gateways like PayBy give access to in-depth and real-time insights with data visualization to track transactions, payment trends, and workers' financial behavior.

You can optimize your payment process, improve your financial strategies, and make better business decisions using these analytics reports.

9. Compliance and Reporting

When you pay international gig workers, you must adhere to regulatory compliance and reporting requirements. Failing to do so can result in unwanted tax implications and penalties. This can lead to huge financial loss, especially if you're working with multiple international gig workers.

Payment gateway solutions can help simplify tax reporting and filing, ensure adherence to labor laws, and regulate payments so that your books remain error-free.

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Key Takeaway

The gig economy in the MENA region is growing at a rate of 3.2%, so it can be said safely that it is here to stay, at least for the next few years.

Adopting a payment gateway solution like PayBy for seamless international transactions is a win-win for employers and gig workers. While employers can save costs and conduct multi-currency transactions compliantly, gig workers can receive timely payment through a safe and secure platform.

Are you ready to experience it? Get started with PayBy today.

Smooth payment processing is the backbone of any online business. Whether you’re an e-commerce platform, subscription-based service, or donation platform, you must offer your customers a smooth payment transaction experience.

Smooth transaction processing creates a positive customer experience, while studies have shown that a negative payment experience can lead to cart abandonment, lost sales, and even a damaged brand reputation.

Although brands want to offer customers a smooth payment processing experience, things are not always in their control. For example, payment processing challenges and in this article we look into the most common ones.

Common Payment Processing Challenges

While different businesses may face different digital payment challenges, here are some common issues that businesses face:

1. Payment Gateway Integration Issues

A payment gateway is a tech platform that enables online businesses to accept, process, and manage various online payment modes, such as credit cards, debit cards, digital wallets, etc., in a secure environment. It is an intermediary between the customer, the business, and their respective financial institutions.

Businesses must integrate a payment gateway with their existing system to work through it. However, integration challenges may arise if you have a poor API, multiple payment providers, or a legacy infrastructure. Lack of seamless payment gateway integration can lead to slow transaction processing and a poor customer experience.

But you can fix this.

• Choose a reliable third-party platform that can handle end-to-end payments for multiple payment modes and offers easy integrations.
• Partner with a provider that has developer-friendly APIs. For example, with PayBy, you can easily integrate it with your website through APIs to enable cashless payments with multiple payment modes.
• Test and validate the integrations are working fine.
• Ensure the payment pages are mobile-optimized so customers can have a smooth transaction experience.

2. Security Concerns and Fraud Prevention

As digital payments accelerate worldwide, the UAE's scene is not so different. A report mentions that card payments in the UAE registered a growth of 14.6% in 2023 to reach AED451.4 billion ($123.0 billion).

At the same time, payment frauds are on the rise. A news report mentions that 54% of customers in the UAE have been a victim of fraud at least once. Customers and businesses are falling prey to fraudulent transactions. Data breaches and unauthorized access are leading to financial losses and reputation damage.

Building a robust security system can help you build trust. A survey report mentions that 47% of respondents are likely to return if they’re assured that payment security is correctly handled.

This is what you can do.

• Conduct regular security audits to ensure all security systems are in place.
• Invest in a robust payment security system.
• Consider using AI for fraud detection to identify abnormal user behavior while making payments.
• Investing in payment gateway security, payment tokenization, two-factor authentication, and a robust verification process can prevent fraudulent transactions.
• Choose a platform like PayBy to ensure all your transactions are safe. The platform offers end-to-end communication encryption using TLS and SSL Protocols, security password control solutions of CFCA, AI-based fraud monitoring, and 3D secure authentication.
• It has been given the highest levels of financial service approvals to conduct Stored Value Facility (SVF) and Retail Payment Services (RPS) operations.

3. Compliance with Payment Regulations

Maintaining compliance and payment regulations is crucial for businesses to avoid data breaches and keep customer information safe. Non-compliance can lead to hefty fines, penalties, and reputation damage for the business.

One important regulatory compliance that businesses must fulfill is the Payment Card Industry Data Security Standard (PCI DSS). The Payment Card Industry Security Standards Council governs this set of security standards, which aim to secure credit and debit card transactions against data theft and fraud.

Similarly, the General Data Protection Regulation (GDPR) is another set of compliance regulations an organization must meet when handling personal data. This regulation gives customers more control over how businesses collect and process their data.

Businesses worldwide must ensure that PCI DSS and GDPR compliance are always met to prevent data breaches and unauthorized access.

• To ensure you’re adhering to compliance guidelines, conduct regular audits.
• Partner with payment platforms like PayBy to ensure that your business always stays compliant.
• PayBy ensures you’re PCI DSS compliant, conducts regular third-party audits, and has a security team to monitor your data's safety.

4. High Transaction Fees

High transaction fees always impact revenue. So, for brands, it is important to create a revenue system with minimum overheads and additional costs. While some expenses are unavoidable, some fees can be minimized, for example, by carefully choosing the pricing models of payment providers.

Some PSPs charge monthly usage and termination fees. Additionally, processing credit cards can incur higher transaction fees depending on the volume of transactions processed.

However, brands can minimize transaction fees.

• Choose payment providers based on percentage-based and flat fees to help you save costs.
• You can also consider negotiating with payment processors and optimizing transaction volume to reduce costs further.
• Always stay up-to-date with financial and legal requirements to avoid any unnecessary costs from new regulations that you’re unaware of.

5. Payment Disputes and Chargebacks

Payment disputes and chargebacks are becoming increasingly common practice. Chargebacks happen when customers contact their credit card issuing bank to dispute a charge. Customer dissatisfaction and fraud claims are some of the most common causes of payment disputes. In a chargeback case, the customer claims they have not received the product or don't even remember making the payment. They then request a refund from their bank or credit card company.

Chargebacks are a costly affair for any company. It affects the company’s cash flow and increases the administrative overheads.

However, you can prevent disputes and manage chargebacks effectively.

• Have a clear communication strategy with your customers about your refund and dispute resolution policy.
• Maintain transaction records and supporting documents to defend against unjustified chargebacks.
• Partner with platforms like PayBy that offer chargeback management services and shield your business against chargebacks.

6. Cross-border Payment Complexities

One of the biggest benefits of online shopping is that customers can buy products from global brands. While digital transactions can easily navigate the different payment methods within one country, the process becomes complex in cross-border payments.

Challenges arise regarding multi-currency conversion, diverse payment methods, and international regulations. Moreover, exchange rates constantly fluctuate, and high foreign transaction fees can impact total revenue. The speed of processing cross-border payments also impacts the business.

But you can solve these challenges and offer a smoother cross-border transaction experience.

• Look for a payment processor that has experience with cross-border payments.
• Partner with a payment processor that offers multi-currency support and real-time currency conversions.
• Consider the local payment preferences and integrate them into your system for a better user experience.
• Familiarize yourself with different local regulations and compliance requirements.
• Educate international customers about the payment and delivery procedures to avoid complications later.

7. Customer Experience and Checkout Abandonment

Like it or not, a poorly designed payment processing system can frustrate your customers and negatively impact the user experience despite having good products/services. As data shows, 88% of online consumers are less likely to return to a site after a bad user experience.

As a survey suggests, 43% of customers in the UAE mentioned that an easy checkout experience is one of the reasons for online shopping. However, customers can abandon the cart if the checkout process is difficult.

Most customers abandon the cart during the checkout process if they don't see their preferred payment options, they’re unsure if the payment gateway is secured, if the payment page takes too long to load, if it is a non-responsive payment site, and if the payment site is not optimized for mobile users.

To reduce abandonment rates, focus on improving the checkout processes.

• Build a simplified checkout process where you can minimize the number of steps by offering a guest checkout.
• Offer one-click payments.
• Optimize the payment page for mobile users with a responsive design.
• Look for a payment gateway that offers multiple payment modes like QR code payment, mobile wallets, credit and debit cards, 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.
• Enhance payment security by staying compliant with the PCI DSS regulations.

Overcome Payment Processing Challenges

Payment processing challenges can impact your cash flow revenue, lead to lost sales, and damage your brand reputation. While managing all these payment processing challenges is important, it’s difficult to tackle them separately. Investing in a solution like PayBy can be a game-changer as it helps you to navigate all the payment processing challenges effectively from one single platform.

Its secure and omni-channel digital payment solutions can help increase your revenue. PayBy offers multiple payment modes across all touchpoints, improves customer transactional experience, reduces cart abandonment, and offers better payment control.

‍Get started with PayBy today.

Without inventory management, your supply chain will be all over the place. 

Inventory management is your guide to aligning your inventory from manufacturers to warehouses to customers. In short, it helps you strategically time demand with supply, i.e. have your product in the needed location at the right time.

Inventory discrepancies lead to either overstocking or understocking situations. Both have a direct impact on your business's revenue. 

When you are understocked, you lose sales, and when you are overstocked, you risk resources being obsolete and wasted. Besides money and time, you are also at risk of business failure. 

Low-profit margins coupled with increased overhead expenses ultimately lead to failure. How well you manage your inventory dictates your business’s success.

This is what inventory management is for. It helps a business find the right balance between demand and inventory. In fact, businesses have outdone their stock management with inventory management systems connected to sales. 

Inventory management systems are the tools for modern-day management that ease this process of ordering, storing, and using inventory. They work wonders, especially since they automate end-to-end production with sales intelligence. Businesses can reach full efficiency in operations with systems like a point-of-sale (POS) system.

This article is a walkthrough of inventory management with POS system, its significance, and how your business can make the best use of it.

Recap: What is a POS system? 

A POS system unlocks a new avenue for handling sales and inventory. How does sales tie-up with inventory help you ask? You need tools and inventory management solutions unique to your business and revenue. Feeding real-time sales data to inventory management can help you get there.

Gone are the days of manual labor or even separate software solutions for all functions. A POS system is one software solution for sales, payment processing, and inventory management altogether. This modern solution is designed to update inventory with real-time data. 

Every time a stock unit is sold, it updates the inventory level instantly. It also facilitates sales and processes payments on the same interface. 

Real-time insights on payments and inventory are the keys to optimal inventory management. Operations, sales forecasting, and decision-making are easy with access to accurate real-time data.

How does a POS system help with inventory management?

Maximize the usage of a POS system to avoid stockouts, overstocks, shrinkage, and waste. Here’s how using a POS system to manage inventory can help:

1. Real-time inventory tracking

The best part about a POS system is real-time inventory updates across all channels and devices. Instant updates help attain accuracy and visibility in stock levels. Real-time access to inventory helps with its management and sales. Sales reps get real-time access to stock levels, so they can better assist the customers. Plus, you will have complete inventory control. You’ll be able to prevent stockouts and restock on time. Instant updates on stock are the best way to meet demand levels without unnecessary storage and handling costs.

2. Automated reordering

POS system comes with automation capabilities. You can stay ahead in stock management by automating the process of reordering. You can set alerts and low-level triggers that prompt order placement. Any repetitive tasks and workflows can be automated with the POS system. Other functions that can be automated are price updates, shipment notifications, reorders, customer and supplier communications, analytics on stock performance, and more. You should look for a POS system that gives you the luxury of flexibility and means to automate what you find fit to automate, not what the software vendor dictates.

3. Minimizing stockouts and overstocking

Optimizing inventory is another powerful feature of a POS system. Using this feature you can run through your inventory data and find unique insights. Insights can help you understand market demand and how much stock you must hold to prevent both stockouts and overstocking situations. With access to metrics like inventory turnover, sell-through rate, stock cover, gross margin return on investment, and more, you can understand demand, your show-stopper products, and underperformers. These insights will help you optimize prices, promotions, and reorders. You’ll be able to expound on efficiency and strategy to maximize profitability.

4. Improved sales forecasting

With automation and insights, POS systems give you ample time and the right means to make impactful decisions. The POS system can produce reports on sales trends, inventory turnover, and customer preferences. You’ll have everything at your disposal to pick up trends, forecast sales, and time them with unique inventory and sales strategies. These data-driven insights and decisions give you enough room for product innovation and expansion as well. 

Recommended read: How does a POS help with cash management

5. Reduced manual work and errors

Manually tracking and maintaining inventory is time-consuming. Plus, there’s a high probability of errors. Even if you use spreadsheets to maintain inventory, you risk human errors borne out of manually feeding the data. The POS system is built to reduce manual work and errors. Its powerful features can not only simplify and automate multiple inventory management tasks, but they are also accurate.

How to find a POS system suitable for your business?

Multiple POS systems claim to do the job, but how do you pick the right one for your business? You need to take your time and find the right system so you can make the most of this seamless technology. Here are some factors that can help you make the right choice:

1. Integration capabilities

The first thing you must seek is whether the technology can integrate into your existing tech stack. This includes the commerce platforms, accounting software, and customer relationship management (CRM) tools you use. Without easy integration, your employees will have a hard time obtaining data efficiency in stock keeping. Integration errors lead to data blockages. So, you must ensure that you check the software’s API and integration support.

2. Room to scale

Choose a POS system that is not limited by scale. It should be able to support your business needs and aspirations when you are starting out and also when you are ready to scale your business. It must cater to your expanding product line, sales channels, and scaling operations. 

3. Great user-experience 

A complex-to-use system is as good as a manual process. So prioritize checking out the POS system’s interface and choosing the one that’s easy to use. Go for the one that requires minimal staff training. Solutions with great user interfaces make it easy for your employees to maintain inventory and for customers to make purchase payments. Ask for a demo or trial before you make the call.

4. Features and tools

Built-in features are another critical factor to weigh. You first need to pin down your expectations and needs from the POS system. This helps you find the system that can best cater to your business. Some of the features you want to look out for are real-time inventory tracking, automated reordering, sales reporting, and customer management. Some POS systems also offer features such as loyalty programs and more. Check them all out to make the right decision.

5. Pricing

The price of a POS system is not just limited to a subscription fee. It might come with upfront costs, hidden fees, and additional charges for updates or support. They collectively make a big expense for your organization, which is why you need to check out the pricing models. 

6. Customer support

It is also critical to check your software vendor’s support system. If they are not easily accessible or helpful, you must skip them. You need a vendor providing instant support and resolution, which can otherwise impact your business’s revenue because of inventory discrepancies and payment failures.

If you are ready to level up your business operations, you must start by improving inventory management with POS systems. Embracing a POS system will upgrade the way you manage inventory and introduce efficiency with minimal effort. Your employees will thank you for the support, and you will have all the data insights to make the right decisions, maximize profits, and scale up your business.

PayBy’s point-of-sale solutions are built to simplify in-person cashless payment transactions between consumers and businesses. This smart POS system is built to suit small to large merchants. 

Enjoy in-depth and real-time insights with data visualization to track transactions, number of sales, revenue, profit margin, inventory sell-through rates, cashier performance, and more with PayBy’s POS system. That’s not all. We also offer QR code payments, a smart box to receive and refund payments, the ability for merchants to check daily transactions, and so much more.

Get started with PayBy today.

WPS or Wage Protection System has been around since the year 2009, facilitating easy and timely wage distribution in the UAE. 

Though it’s been a while since it came into force, not everyone is aware of its functionality and importance. Employers and employees alike have a hard time keeping up with this evolving salary transfer system which was built to make their lives easy.

Not only does WPS lay down employees' rights but also makes it easy for employers to build an easy salary disbursement system that’s compliant with labor laws.

Curious to know more? This guide answers all your questions about the wage protection system in the UAE.

What is the Wage Protection System (WPS)?

Simply put, the Wage Protection System, most commonly referred to as WPS is an electronic medium to transfer salaries in the UAE. The Ministry of Human Resources and Emiratisation (MOHRE) and the Central Bank of the UAE came up with this system in the year 2009 to practice timely and precise salary disbursement. 

This system aims to not only protect the interests of the employees but also help ease business practices and their legal obligations. This system ensures whatever is promised to the employees, is fulfilled, and employers can do it seamlessly. The system went on to become a crucial factor in the UAE’s labor market.

What function does WPS serve?

UAE, the most popular choice for expats, had a grave concern - irregular salary brackets and disbursals. The need of the hour was a uniform system of salary disbursal and thus WPS came into being. This framework had just one ask - for the employers to disburse salaries electronically via authorized financial institutions. This centralized system also made it easy for the concerned authorities to monitor and control wage disbursement. 

What’s in it for the employers, you ask? Well, moving the disbursal process to an electronic medium gave employers the best of what automation had to offer. Companies started saving a lot of time, effort, and resources while also enjoying efficiency. 

Other perks of this system were slashed disputes and salary disagreements. Employers and employees had proof of legal evidence which uplifted the integrity and efficiency of the payment process. This simultaneously brought down labor conflicts and legal liabilities.

As for employees, their rights are now recognized. They are compensated appropriately and timely without having to ask for or fight for it.

How did the Wage Protection System Evolve?

The history of the Wage Protection System (WPS) goes back to July 2009. It was formed as a part of Ministerial Decree No. 788 to ensure employee wellbeing. This system was initially formed to help fight inappropriate practices employers used to escape paying wages, like having offshore accounts and other common instances such as wrong or delayed payments.

But the labor market has been evolving. To match the needs, the authorities have been fine-tuning this system to introduce new regulations or make enhancements to the current ones. 

The system saw fresh updates in Ministerial Decree No. 739 of 2016, 2019, and 2022. The new updates have massively contributed to the system, strengthening its power and adaptation to the needs of human resources. Fresh perspectives from the employers’ angles have also been introduced to help businesses. All these efforts have only made WPS more reliable, relevant, and important to employers and their employees.

What are the key components of WPS?

WPS is a huge contributor to enhanced financial stability and confidence in the UAE’s labor market. Precisely, these components were the key contributors:

1. Efficiency in payouts

As the prime objective, WPS ensures diligent observation and supervision of wage payments by employers. It ensures the incorporation of best and fair wage disbursal practices. 

As a rule of thumb, employers need to upload the required information and documents to verify the agreement terms signed with the employee. The system also scans the documents to ensure the stated terms and conditions are compliant with the labor laws and secure employees' interests. It is compulsory for all private organizations in the UAE to adopt this practice to ensure employee protection. 

2. Punctuality in disbursement

Another core objective of WPS is timely salary disbursals with no delays. With the verification of documents, information, and employees' salaries, a set of payment instructions is released to the financial institution responsible for the disbursal. 

These institutions confirm that wages are complaints and then implement the process of transferring funds to the employees’ accounts. Employees' experience boosted confidence with timely disbursals and employers enjoy the reputation of being compliant. 

3. Structure in disputes

Not only does the system lay down terms and conditions for timely and appropriate wage disbursals, but it also lays down a structure to address and resolve wage-related disputes. The framework dictates MOHRE as the decision-making authority of the initial stage. 

MOHRE helps conflicting parties negotiate and find a common ground for resolution. Otherwise, the issue can then be escalated to Labor Disputes Settlement Committees. With the power to issue binding rules, these committees further help solve the dispute. This proposed approach drives peace by preserving and enforcing employees’ rights.

4. Improvement in compliance

It is compulsory for employers to adopt WPS and be compliant. Otherwise, this system also lays down ground rules for punishment if there’s a violation. Non-compliant employers have to face severe penalties such as operational restrictions and fines. 

What are the benefits of WPS?

WPS enforces transparency for both employers and employees as a common benefit. This collectively uplifts the nation’s growth and broadens the possibility of foreign investment. Here are the other benefits:

For employees:

• Timely payout of wages
• Fair salary brackets and wages
• Reduced wage-related labor disputes
• Safeguarded rights in the private sector
• A productive work environment for employees

For employers:

• Better & efficient payroll management
• Reduced administrative burdens
• Time savings with automation
• Compliance with labor laws
• High reputation that attracts skilled labor

How to prepare for the Wage Protection System?

Before you kick start the process of adopting the WPS system (which is a must if you want to do business in the UAE), here’s a pre-to-do list you must complete: 

• Have a corporate bank account registered in the UAE
• Sign a contract with a WPS agent (a bank, exchange house, fintech, or any other financial institution)
• Create a payroll cycle according to Ministerial Decree No 788
• Confirm to pay 70% of all staff or 75% of wages or salaries
• Agree to pay fees, charges, or any other WPS expenses

When you are all done with the list, follow it up with a 4 step framework to register for WPS:

1. SIF - get started with preparing a SIF or Salary Information File. This file should provide employer and employee details like CTC, Basic Pay, perks, deductions, etc. Make sure you submit this file every time you release a payroll. 
2. Verification - MoHRE in partnership with the central bank will now go through the file and give you a go-ahead. Make sure you adhere to all the rules, regulations, and compliance requirements.
3. WPS agent buy-in - if approved, MoHRE and the central bank will now notify the WPS agent to go ahead with payment processing. You will be notified in case of discrepancies, but it is smart to avoid them as they may come with penalties and fees.
4. Payment - for the last step, the WPS agent now disburses the salary from the employer’s account onto the employee’s account.

The WPS framework is the perfect win-win situation for employees and employers. As a company owner, you must register with WPS to comply with labor laws, enjoy automation support & efficiency, and uphold a high reputation.

To know more, read this guide to know the nitty-gritty of WPS.

Need help with WPS registration and compliance? PayBy can help. 

We offer digital solutions for payroll integrations and wallets. This comes with the benefit of instant salary disbursals to wallet cards that are compliant with major UAE regulations. Above all, you can enjoy digital onboarding, payroll transfers, tracking, and more.

Get started with PayBy today. 

FAQs

What is WPS in the UAE?

WPS or Wage Protection System is a framework to secure the interests and rights of employees in the UAE. It mandates electronic wage transfer for private-sector employers. 

What is the importance of WPS Salary in the UAE?

It is mandatory for every MoHRE-registered employer to adopt WPS and practice WPS-compliant salary disbursal methods.

How to know if my company is WPS compliant?

Anyone can check the WPS status of an employer by visiting MoHRE’s official website.

Are companies with few employees required to register with WPS?

If your company has a headcount of minimum 10 employees, you must register with WPS.

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.

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.

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.

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.

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.

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.

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.