What Should Your Next Payment Solution Be for 2022?
South African SMEs play a significant role in our country’s economy, representing 98% of businesses and employing 50-60% of the country’s workforce in both the formal and informal sectors.
Arguably, SMEs are the lifeblood of our economy. Unfortunately, they’re also the most at risk. Owing to their limited cash reserves, smaller client bases, and lesser capacity to manage commercial pressures, they’re often the least resilient – especially during times of crisis. Covid-19, with its ensuing lockdown measures, has certainly put unfair pressure on this critical engine of our economy.
We work with SMEs to help them leverage technology in a number of areas to help mitigate risks, reduce costs, protect their businesses from cyberthreats, reach new customers, and provide a distinctive value proposition to their customers. Case in point, new payment solutions and technologies available for SMEs could be the key to moving forward in 2022.
Let’s take a deeper look at the lay of the payment services land to see what your options are.
Should You Consider a New Payment Solution?
Understandably, the biggest question for most startups is where they should be focusing their limited resources. Specifically, should they explore the next payment solution/technology if brick and mortar stores aren’t likely to ever really vanish – even in the face of pandemic-related lockdowns and increasingly more consumers moving to ecommerce.
While this means that there’ll still be space for Mobile POS payments, we’ve seen and worked with SMEs who want digital payment solutions rather than POS payments. Most often, their motivation is the affordability and convenience that comes from switching to a new payment solution.
Factors Influencing Your Choice of Payment Solution
Perhaps the most important factor when it comes to deciding if your business could benefit from a new payment solution is your customers’ payment preferences. This is especially true in light of Covid-19 and how the pandemic has influenced consumers’ strong need for more hygienic and convenient ways to transact.
That said, preference isn’t the only factor to weigh up.
Other considerations include:
- The size of your transactions.
- The types of payments your business can accept.
- Who’s handling the money.
- Your accounting system.
New Payment Solutions for SMEs
There are several new payment solutions coming to the forefront, including revolutionary voice payment technology that allows consumers to transact money to a friend or acquaintance using the peer-to-peer network. While this is an exciting space to watch, our key focus here is which new payment solutions SMEs in South Africa can take advantage of in order to help their businesses survive and grow.
The options we believe should be considered, include mobile payments, contactless payments, biometric authentication, and mobile wallets.
- Mobile payments make the purchasing process more streamlined and flexible, allowing you to reduce queues and speed up checkout services. Mobile payment solutions encompass a range of options, including payments made through digital wallet apps and near-field communication technology, money transfer apps, and payments using a mobile card reader to swipe debit or credit cards.
- Contactless payments eliminate the use of chip and pin transactions, allowing consumers to wave their card (or smartphone) over a scanning device to securely and hygienically make purchases. It’s faster, more convenient and no wonder that the likes of Samsung, Apple, and Google have already enabled this system.
- Biometric authentication is a unique and important payment method as it incorporates and provides accuracy, efficiency, and security under a single package. It involves an individual’s unique characteristics. This factor also helps in building customer loyalty and trust.
- Mobile wallets have increased in popularity, with around 2.1 billion users in 2019 alone. Simply, a mobile wallet solution is a mobile application that mimics an actual wallet, allowing users to send money to other users, receive money from other users, and store money inside the wallet.
Let’s Talk Solutions
The reality is that SMEs are a vital engine in the South African economy, driving growth, creating employment, and spearheading innovation. Importantly, SMEs are also customers to larger companies across the supply chain and supply vital goods and services to companies and households, helping to keep the wheels of the economy in motion.
As a business owner, particularly in the SME space, we have no doubt that you have invested in the relevant strategies, tools, and software to help your business survive the past few years. Moreover, we understand just how important your business is, we value how technology can be leveraged to build a better future for your business, and the guidance we offer is to help you continue on your path to growth and prosperity.
Importantly, we’re not just here to provide solutions, but to partner with you to enhance your business. Talk to us about how we can help your business discover the right payment solution.
Let’s connect.
