Top Challenges of Electronic Payment Systems

Posted by Modo on Jun 14, 2019 11:30:00 AM

 

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Q&A—The Main Challenges of an Electronic Payment System

Introducing a new eCommerce payment system into your business can be challenging. You need to balance the exciting features that better payment processing will provide, with the difficulties of having to install, integrate, configure, and learn your new payment processing software.

With the right support and advice, your brand new electronic payment system will drive streamlined, efficient, low-cost payments. You’ll recognize benefits across your entire business through reducing fraud, delighting customers, and creating a technology stack that will support all your future growth plans.

With that in mind, we’ve gathered top questions to ask when deciding what the unique challenges are for your eCommerce business—and then walk you through how you to resolve them. After all, we’re here to help you reap the benefits from your payment processing, while keeping risks and challenges to a minimum. Before diving into the nitty gritty, here are the main things to look for when choosing the right electronic payment system:

  • Provides a seamless, friction-free customer experience.
  • Integrates with your entire payment ecosystem through your payments stack.
  • Routes different payment types and amounts to the lowest-cost payment processors.
  • Detects and prevents fraud while avoiding false declines.
  • Offers multiple payment options to consumers.
  • Keeps installation, development, and other costs to a minimum.

Without further ado, here are the answers to your most pressing questions.

Will Your Electronic Payment System Provide an Awesome Customer Experience?

With so much competition for consumers, your online customer experience has to be second-to-none. This means looking at every aspect of the customer journey—from selecting the product to putting it in the cart, choosing how to pay, and the payment and order confirmation process. You’ll need to review and tweak the customer experience process while looking at the payments stack, as changes to any part can impact on how your customer feels.

Ideally, you’ll want eCommerce payment processing that emphasizes speed, simplicity, and security. Look for extremely fast authorizations that don’t compromise your fraud detection and approval process. Seek out electronic payment systems that will flawlessly integrate with your website and provide end-to-end ease-of-use. Establish whether your payment processor allows for multiple payment options for your customer.

Will Your eCommerce Payment Processing System Integrate Into Your Payments Stack?

Online retailers know that there’s no such thing as a one-size-fits-all solution when it comes to payments. Integration and interoperability are the bywords here—being able to customize an ecosystem of payment features and allowing flawless, fast, secure communications and data transfer between them.

And while smaller retailers might be able to get away with built-in integrations in specific software—your millions of dollars in annual payments will need as much flexibility as possible. That's where a payments stack comes in—centralized technology that links together all of your payment options, processors, gateways, specialist software, and more to deliver the best customer experience at the lowest cost to you.

Look for payment processing and ecommerce systems that have strong APIs that can easily link to a payments stack to keep your development costs to a minimum. Make sure you spend plenty of time analyzing the payments stack system that can best meet your needs, as it’s one of the most important functions for efficient payment processing.

Can You Route Different Payment Types and Amounts to the Most Efficient Payment Processors?

Larger ecommerce retailers will likely have special agreements and rates with multiple payment processors. Depending on how a customer chooses to pay and the amount of their purchase, it makes sense to route that transaction to your lowest-cost option. Look for an ecommerce payment system that can filter and use AI or other rules to decide on the best payment processor based on your criteria.

Do You Use the Most Up-to-Date Fraud Detection Software to Help Accept or Reject Transactions?

Fraudulent transactions for ecommerce are a massive problem. Although banks and card networks can do plenty to authorize or reject transactions, sometimes online retailers need a little extra help. For many ecommerce sellers, that means linking up with a fraud detection platform. There are plenty of startups and established businesses offering fraud detection. You’ll should prioritize  software that uses multiple criteria for fraud detection, including GPS location, address, shipping address, amount, card history, purchase patterns, what’s being purchased, previous fraud or chargebacks, and other factors.

You’ll want to integrate fraud detection into your payments stack and tweak the rules to avoid false positives where you reject legitimate payments (false declines), and false negatives, where the fraudsters get through the authorization process. Although many fraud systems will train themselves through AI and machine learning, you can also set your own rules and criteria to keep losses to a minimum.

Look for fraud detection systems that use multiple criteria and approaches to filter out fraudulent transactions, and measure success over time to continually tweak your approach.

Will You Offer Multiple Payment Options to the Customer?

The way consumers pay online is changing. We’re moving away from traditional debit and credit cards to other systems like mobile and eWallets, cryptocurrency payments, direct bank payments, and dedicated smartphone apps. You never want to make the customer jump through too many hoops, so choose an ecommerce payment system that lets customers pay however they want. You can achieve this by future-proofing your payment processing.

Choose an electronic payment system that allows customers to pay through any option they choose, including credit cards, debit cards, prepaid cards, smart cards, eWallets, mobile wallets, Apple Pay, Samsung Pay, Amazon Pay, Google Pay, PayPal, bank accounts, bank drafts, eChecks, and cryptocurrency.

Do You Know How Much Cost and Overhead is Involved with Your New Payment Processing System?

Finally, upgrading to a new ecommerce payment system can be expensive—not just in terms of paying for the platform, but the costs of development, installation, integration, consulting, and support. It’s important to understand all of your cost and research requirements when choosing the right electronic payment solution for your company. One way to do this is by looking for systems that work with your payments stack out-of-the-box, as this can massively decrease the complexity and cost of having to setup APIs and integrations in-house.

We hope you’ve found these answers useful, and that they provide helpful guidance when it comes to choosing the right eCommerce payment platform for your enterprise.

Topics: ecommerce payment processing, payment processor, Challenges of electronic payment systems