5 more reasons why setting up a mobile payment system is worth the expense

5 more reasons why setting up a mobile payment system is worth the expense

A basic tenet of commerce is this: Go ahead and reach out to customers. Just make sure they can reach out to you, too.

That's the beauty of mobile payments: selling your goods and services and letting customers pay for them conveniently over their cell phones or other portable devices.

So why are some U.S. merchants reluctant to sign up for mobile payments? Part of the problem is that both merchants and customers feel anxious about the security of sending sensitive financial data over the phone. Another potential barrier to increased merchant activity is price, and that's an issue that mobile payment providers will need to improve.

"Mobile payments platforms represent a leap forward in electronic payment transactions, but those who want to claim leadership in this space have to reconcile merchant resistance to the imposition of costs to implement new infrastructure that will be managed in an increasingly complex environment," said VeriFone CEO Douglas G. Bergeron in a report released by the payment solutions giant.

That raises the question: Are mobile payments worth the effort -- and the increased hit to the business owner's budget? Increasingly, the evidence would say yes. Here are 5 reasons why:

1. You'll get paid more quickly.
As Woody Allen once said, "Money beats poverty, if only for financial reasons." Mobile payments enable you to get money owed to you by customers instantly. Gone are the days of extending credit to customers. Now, you can get paid right away, and the cash can go right into your merchant account. Mobile payments also offer convenience -- you can make a purchase from anywhere -- and speed (most 4G phones execute mobile payments within seconds). Debit and credit cards may offer similar transaction times; but they're otherwise limited to in-store, phone and computer-based purchases.

2. Merchants can use mobile commerce not just to collect payments; they can also use it to advertise their companies--the ultimate "two-fer."
Cell phone apps are highly sophisticated, and now mobile payment apps are available that allow businesses to offer discounts, loyalty rewards programs and coupons to customers who pay via mobile phones.

3. Mobile payments save time.
Any economist will tell you that time is as much a commodity as cash. New mobile apps like Square (from Twitter co-founder Jack Dorsey) enable businesses to quickly set up mobile payment accounts without the hassle of establishing another merchant account, or having to fork over monthly fees.

4. Have mobile payment, will travel.
Mobile merchant accounts are manna from heaven for businesses that want to broaden their payment options. Historically, mobile payments have been limited to cash or checks. Nowadays, companies can seemingly accept as many payments (think debit or credit cards) as Baskin-Robbins has flavors of ice cream.

5. Fatter revenues.
Any time you can add a new payment option that consumers are increasingly embracing, you sign right up for it. So it goes for mobile payments, which can increase your sales by offering that golden watchword to customers -- convenience -- thus giving them another reason to do business with you. Mobile payments offer another revenue stream for business owners, apart from in-store, over-the-phone and computer-based purchases. In business, increased revenue sources translate into more profits.

With mobile payments available on a multitude of platforms, including cell phones, tablets and laptop computers, customers are finding it easier than ever to make credit card transactions. A 2011 Javelin Research study shows that 84 percent of all consumers use cell phones, and one-third of that group uses smartphones. 20 percent of mobile phone users, in turn, have made a credit card payment over their phones.

But these added benefits only work if your business is set up for mobile commerce. Like the man said: luxury or convenience? If you don't decide, your customers may decide for you.

See related: Study: Get ready for mobile wallets; Should you switch to a mobile payment system? 

Published: May 18,2023