Launching and starting a successful business is a dream for any small business owner however with more business growth comes the challenge of being able to send and receive money especially in substantial sums. Regardless of what products or services your business offers there are a variety of payment options and providers to consider.
To continue to reach new customers and carry out transactions regardless of location, small businesses must optimize their business processes in terms of how to carry out and receive transactions to enable them to do business with ease.
How Payment Methods Have Changed
Also in line with the recent coronavirus pandemic and economic downturn, small businesses need to diversify their means of receiving and sending money to both their customers and third parties (local or foreign vendors) they conduct business with. Small businesses must keep looking for ways to bring down business costs by looking for the cheapest ways to send and receive money to help keep their business afloat.
For businesses, deciding on the best and cheapest ways to send and receive money is not always an easy decision as you might need to combine payment methods in order to help your customers and vendors get the best experience when conducting transactions with you. Some key factors to look out for in order to help you make a decision would include the cost to process the payment, the cost of administering payment, risks, time for transactions to become available in your bank account amongst other factors.
Cheap Payment Methods Available To Small Businesses
As a business owner, you’ll need to decide which types of payment your business accepts. Below are four cheap payment options small business owners can choose from:
- Cash Payments
- Wire Transfer Payments
- ACH Payments
- Check payments
- Mobile payments
Traditionally, cash payments have been the way for businesses to send and receive money. Business owners continue the use of cash payments because it fast tracks the immediate exchange of goods and services. Although physical cash payments are secure for really small businesses initially, as a business grows, sending and receiving money via physical cash payments is not ideal for the long term as such transactions are susceptible to loss, theft, being unable to adequately track incoming and outgoing payments among other issues. Regardless of the challenges of the traditional cash payments, the benefits of receiving cash payments immediately after offering a service or selling a product provide the cheapest way to send money for a really new business that deals with really small daily transactions cannot be overlooked.
Wire Transfer Payments
A wire transfer simply refers to a method of electronic funds transfer. Wire transfers allow you to move and receive funds directly into your bank or another with minimal hassles. It is also important to note that electronic payments generally fall into two categories: wire transfers and Automated Clearing House (ACH) payments (more about this next) and wire transfers. Wire transfers are also subject to charges depending on the platform you use. Afriex offers a no-charge transfer of from $25,000. Afriex makes it possible and easy for you to pay your foreign vendors abroad in a simple, fast and secure manner. Whether you're a car dealer, shipper, student, real estate investor, tech entrepreneur, etc you can trust Afriex as the cheapest way to make international payments.
ACH (Automated Clearing House) payments refer to direct deposit payments. ACH payments provide a way to transfer money from one bank account to another without using paper checks, credit card networks, or cash. An ACH payment when initiated occurs within the Automated Clearing House Network which connects all U.S. financial institutions. ACH payments can be used for paying supplier invoices, bill payments, and other expenses, as well as to receive payments from customers. One thing to note about ACH payments is that they occur only within the US and processing times take place in batches three times a day as a result, ACH funds can take several days to process
Check payments are payments made using a check withdrawal paper that contains information that is used to initiate a transaction of funds at a financial institution. Checks are generally limited in use to banks and can’t be cashed out by just anyone. Before a check can be cashed, it is important to note that all checks must include information such as date, payee name, the amount the check is for, and a signature for validation. Advantages in the use of checks include security features like holograms, watermarks, or a paper trail. However, checks can’t be used to facilitate online transactions smoothly.
Often referred to as Digital Wallets, Mobile payments involve the use of apps such as Afriex linked to a bank account which could be a credit card, debit card etc from which transactions are made. What makes mobile payments an easy choice for small business owners include the speed of carrying out transactions and how easy it is to use since everyone has a smart phone today which is where transactions are initiated from. With mobile payments small business owners can save time and carry out transactions from the comfort of their business’s location. In addition, making use of mobile payment apps provides added security as credit card or bank account information isn’t stored and any sensitive information is encrypted.