The pace of innovation in the payments arena has been remarkable in recent years. Customers have more options than ever before to pay for their purchases — provided the businesses they’re buying from have the capacity to accommodate the growing diversity of options.
“The era of ‘cash, check or credit card’ is long gone; we are now deep in the realm of digital and mobile payments,” says Matt Evans, head of PNC Merchant Services for Small Business at PNC Bank. “The pace of change is accelerating as payment options multiply. For example, newer options such as account-to-account (A2A) payments, which involve a direct transfer of funds from one account to another, are beginning to gain traction. It’s important for business owners to be nimble so they can adopt payment capabilities as they evolve.”
Evolving technology enables faster processing and overall management of a broad range of payment types to help stimulate cash flow, boost productivity and elevate the customer experience. But that’s not all: Today’s payment solutions can help business owners manage other aspects of their business, too.
“Some business leaders think that once they acquire a payment system, they can forget about it — it has worked well for them from the beginning, so it will continue to be the right solution regardless of their company’s growth and the evolution of technology,” Evans says. “Emerging trends have the potential to make a decisive impact on efficiency and operations.”
Taking advantage of new capabilities doesn’t necessarily mean business owners need to entirely replace their payment systems. Depending on their unique situation, the solution may be as simple as upgrading the capabilities of their current system.
Streamlining Multiple Functions Through a Single Platform
Versatility is at the heart of many of today’s payment technologies. While all payment systems are intended to enable businesses to accept and manage payments, banks such as PNC are pushing payment technology further, integrating diversified capabilities so that a single platform can fulfill a wide range of needs across multiple areas of operation.
“Our clients have been astonished at how far payment platforms have progressed in just the past few years,” says Evans. “Functions such as payroll, accounting and human resources can all operate seamlessly from one platform — a platform that becomes more of a business management system than simply a payment management system.”
One example of this trend is Linga, a point-of-sale (POS) system designed for restaurants and retailers. With Linga, users can tap into a battery of services ranging from payment processing, inventory management and employee scheduling to marketing, customer loyalty programs and performance analytics.[1]
“Payment systems have broken out of their silo, providing a variety of value-added capabilities,” Evans adds. “That’s why so many small business owners are reassessing their current technology and looking toward updated solutions.”
Higher Productivity = Greater Profits
Staying on top of payment technologies can yield significant rewards in terms of saving both time and money. While a payment system may have been adequate when a business was a start-up, could that legacy system be costing the business owner money today?
Integrating an updated payment system into day-to-day operations can deliver markedly higher efficiency. And when productivity is ramped up, business owners can potentially see a significant boost to the bottom line. For example, think about how changing their current system software to use a QR code ordering system that reduces their staffing needs, or adding an inventory tracking system to ensure they aren’t over- or under-ordering goods, could make a big difference.
“With so many business management solutions available,” Evans points out, “adding the right configuration to a payment system could potentially help uncover savings in surprising places.”
If a business has grown over time, one of those places could be transaction fees — the amount a merchant pays with each electronically processed purchase. New payment technologies are making it possible to drive down those costs.
Depending on a variety of factors, transaction fees can potentially siphon off 0.5% to 5% of a credit card or digital purchase.[2] When considering the average small business ekes out a net profit of just 10% of sales,[3] even a 0.5% cut in transaction fees could offer a significant boost to profits. “Shaving a half-point off transaction fees might not seem like much, but if business owners are ringing up a million dollars a year in digital payments, it could add thousands of dollars to their bottom line,” Evans says.
Data and Analytics Offer Transparency
With ever-increasing levels of sophistication, today’s payment systems are living up to the promise of helping small businesses grow in sales and profitability. Specifically, they are providing data-collection and analytics capabilities that could spin gold for your business.[4]
“Business owners can see where their peaks and valleys are, what customers want, and which inventory is, and isn’t, popular. There are an almost infinite number of ways to crunch the data,” Evans explains.
Having clear visibility into their customer base and the payments process itself empowers business owners to identify trends, uncover transaction performance issues, detect fraud and more. They can get ahead of technical issues and take full advantage of what they learn about their customers’ preferences and behaviors. Customer data and analytics generated through their payments system can aid them in establishing meaningful dialogue, targeting their marketing efforts, building a loyalty program and launching new products.
Taking the Next Step
Whether updating a current payment system with new capabilities or opting for full replacement, a refresh could make a world of difference to a business’s customer experience, cash flow, operations and profits.
Learn more about payment processing solutions, and feel free to visit your local branch office or to speak with a PNC Merchant Services representative, Monday - Friday 8 a.m. - 5:30 p.m. ET, at 1-888-562-2300.
Narrator: The world of payments is evolving and fast, and if your payment systems are years behind, you could be missing out. It's not just talking about cash or credit cards anymore. New trends are reshaping how more and more customers want to pay. But here's the exciting part. Today's payment systems aren't just about taking payments.
They can streamline your entire business. So you save time and money, plus boost your bottom line. And don't forget the data. Every transaction gives you insights into customer behavior, helping you make smarter decisions. Ready for an upgrade? Explore your options today. Learn more on PNC Small Business Insights at pnc.com/businessinsights.
