The future of digital payments: Trends and innovations
September 2, 2024In today’s economic ecosystem taking hold of progression and innovation isn’t just a suggestion. It’s a necessity. While this is true for every area of your business, the digital revolution has set its sights firmly on invoicing and bill payments, changing the way people pay, and businesses get paid.
But what does that mean, and what exactly should business owners know about billing management solutions? Now, if it seems as if there are dozens of obvious answers, that’s because there are, and they become more by the day.
That said, discerning which actually has value, also gets more challenging daily. Luckily, the heavy lifting has been done. So, let’s dive into a value-packed and actionable guide to understanding the new landscape of invoicing.
A quick introduction to invoicing solutions and bill payments
Before getting to the whys of billing solutions, it’s incredibly important to do a quick background check of the basics behind invoicing.
What is an invoice payment, and what is it used for?
Essentially, an invoice (or bill) is a payment request from a service provider or the seller of goods to a buyer. This demand is issued after the sale or rendering of services, indicating a breakdown of the costs associated with the items or work done.
These invoices can be used as a once-off payment demand for a project while also being usable for recurring payments for ongoing work. The ideal goal of invoicing is to foster an ongoing relationship between businesses and customers.
How invoicing and billing solutions have changed
The saying goes, “Out with the old, in with the new”, and when it comes to generating invoices and requesting payments, this couldn’t be more true. Not too long ago, invoices were issued via postal service and would typically involve a bit of waiting.
That said, invoices did prove to be an easy, largely reliable, and cheap way to interact with customers considerately and civilly. Time doesn’t wait, however, and the digital revolution has changed the way customers receive bills and pay their invoices.
The same goes for businesses’ methods to generate, deliver, and record invoices. This is strikingly true in South Africa, as the need for seamless, easy-to-use, and speedy invoicing systems has evolved the local billing landscape.
What makes an invoicing solution stand out?
Keeping in touch with advances in billing solutions is one thing, but what genuinely makes an invoicing system stand out? There’s no shortage of viable choices out there, but here’s a run-through of some criteria you need to keep in mind, especially in the digital age:
- Intuitive programming: Invoicing systems should be able to understand and adapt to your business’s unique needs, ultimately streamlining your daily operations without a steep learning curve.
- Functions in a scalable way: As your business grows, so should your billing software, and digitally speaking, the sky is the limit. Integrated into your accounting and billing, the right system should quickly scale alongside your business.
- Legal and regulatory compliance: Compliancy is king, and that means your invoicing and billing systems need to meet legal and regulatory needs.
- Easy customisation: Being unique, diverse, and expressive isn’t normally associated with invoices, yet creating a lasting impression wherever you can, will help your business stand out.
- Seamless flexibility: Your business operates within a dynamic financial world, which demands flexibility in every aspect of your company. An invoicing solution should function without any rigidity, meeting fresh challenges head-on.
Why is having an efficient invoicing system so important?
So, with the foundations of modern invoicing laid, why are future-forward billing management systems so valuable? Far more than simply sending an invoice online or being paid on time, having these solutions in place plays a deceivingly larger role.
To remain profitable, a business must keep attracting and retaining new customers. Retaining customers once you win them is essential to building customer lifetime value and long-term profitability. Attracting and onboarding a new customer usually involves sales, marketing, advertising, and administration costs.
But once they’re on board, the costs of cross-selling and upselling to customers are lower than those of winning new prospects. One celebrated study found that increasing customer retention rates by 5% increases profits by 25% to 95%.
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How simple, easy-to-use billing management solutions affect customer retention
Many elements go into customer retention, but one that many small and medium businesses overlook is the billing and payment experience.
This part of the customer relationship should be smooth and effortless, but frustrations often creep in. Here are a few ways a better billing and payment experience can help you increase customer satisfaction and retention:
Personalised invoices that customers can pay instantly
Most consumers find paying monthly creditor accounts a pain point. They receive a range of invoices by email, text, or web portals, and they usually need to log into online banking or a separate payment gateway to pay each bill.
But with a modern payment solution, your customers can pay directly from a secure link sent by SMS or email. This saves them time and effort, making it less likely they’ll forget to pay. It also facilitates a smoother customer relationship.
Fewer failed payments
Research from LexisNexis found that 60% of organisations reported losing customers due to failed payments. Furthermore, they found that failed payments cost the global economy an estimated $118.5 billion in fees, labour, and lost business.
A robust, modern payment and billing gateway will help minimise failed payments, reducing the risk that the customer will give up in annoyance and shop elsewhere.
Supporting the customer’s payment medium of choice
The selection of payment options is daunting for an SMB (Small or Midsize Business). They include cash, EFT, debit orders, retail payments, debit and credit card payments, QR codes (Scan to Pay), digital wallets, and instant EFT.
However, many customers have a strong preference for which payment method they use. Some feel strongly enough that they might go elsewhere if they can’t, for example, pay by card, instant EFT, or retail payments.
Or, if their first choice fails, they can pay via another method. Supporting all these options used to be complex. However, today’s fintech payment solutions support payments from multiple channels and methods in a single platform anytime, anywhere.
They also integrate with leading software vendors to enable you to automate payments, acceptance, and reconciliations from end to end.
No-effort subscriptions and debit orders
One of the most mundane reasons customers allow their relationship with a company to lapse is that they simply forget to make a monthly payment. Enabling them to sign a debit order mandate or a card subscription is a powerful way to retain customers.
They won’t need to remember to make a manual payment, and you’ll receive the money on time each month.
Analytics and data to get customer insight
Once you’ve invested in a payments solution that integrates smoothly with your accounting solution and eCommerce platform, you’ll have access to rich data about your customer’s journey.
You can analyse transactional data to understand customer likes, preferences, and behaviour. These insights can help you improve your customer experience to build loyalty and satisfaction.
The ways Netcash’s innovative invoicing is changing payments
It won’t take long to find evidence of innovative invoicing already around you and your business. Providing solutions to consumer pain points in payments and opening up payment channels, to name a few, there’s plenty to be said about the fresh face of invoicing.
- Improved data accuracy: Modern invoicing involves improved data capturing, analysis, and accuracy, which saves time.
- Simplified payment and invoice tracking: Being able to keep better track of your invoicing adds another layer of stability to your cash flow.
- Eliminate human error: Duplicate data entry can have short—and long-term negative side effects, but automated invoicing eliminates human error.
- Optimise resources: Adopting our invoicing systems into your business allows you to analyse sales across multiple platforms, optimising human resources.
- Easy accessibility: The digital shift in finances has created the need for virtual accessibility in invoicing and payments, which saves your business time and resources.
- Seamless integration and automation: Integrating our various partner apps and functional automation into your invoicing ensures that your payments ecosystem runs smoothly.
Elevate your invoicing and billing management with Netcash
There you have it. Although invoicing has been around for ages, a new revolution has changed the face of this payment staple. As the industry keeps evolving, your business needs to keep up. Luckily, you don’t have to do it alone.
Established in 2003, Netcash is a payment solutions provider that delivers debit order, salary, and creditor payment services to South African businesses and organisations. We provide multiple innovative and integrated online payment solutions that are efficient, simple, and cost-efficient.
Get in touch: Ready to take your business to new heights? Reach out today.
Netcash is registered with the FSCA and PASA and is PCI DSS Level 1 compliant.
Author:
Candice Sergeant
Product Manager
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Candice Sergeant is a digital dynamo at Netcash, where she’s on a mission to help South African businesses level up their online game. As an eCommerce Product Owner, she’s got her finger on the pulse of the latest trends and technologies, constantly seeking out ways to boost sales and streamline operations. With a knack for spotting opportunities and a passion for innovation, Candice is your go-to guide for taking your e-commerce business to the next level.