By and large, the business community is known for setting financial and technology trends; blazing a path for consumers to follow. However, there are two notable exceptions as of late. The proliferation of smartphones was driven by consumers and would finally be embraced by business several years later. As well, and certainly less talked about, consumers lead the charge toward ditching paper checks by taking advantage of every means to pay for things electronically.
Where the dynamics behind the consumer push for ubiquitous use of smartphones makes sense; it’s not so clear why consumers are beating business in the race toward e-payments. Thankfully, Olga Kharif at Bloomberg Business offers some recent insights into how far business lag behind consumers in e-payment adoption and some recent developments that are likely to prompt business to catch up.
CLICK HERE to read Olga’s report:
Otherwise, read on for a summary of her report.
Crone Consulting Research
According to the Crone Consulting, thirty five (35) percent of Americans pay their bills with some type of check; where businesses are estimated to pay more than half (around 50%) of their transactions the way.
Crone goes further to estimate that the cost for a business to pay using a check is around $5 to $25, depending the process used to produce the check, postage, managing fraud, and the expense of rush processing. When compared to Crone’s estimates of $1 to $2 per transaction for e-payment channels.
Given the substantial investment by the federal government, banks and large companies to build a solid infrastructure e-payment channels; it can be mind boggling why some so many checks are still being written or printed.
The Cloud Factor
Another technology trend that has been taking root over the past decade is cloud programs which include programs like Netsuite and Quickbooks. Cloud programs tends to reshape how people think about data, processes, and data integrations needed to make it all work.
The whole purpose of adopting a cloud program streamline and economize; but what if a business is implementing a cloud based accounting system and at the very last step of the electronic data process it says, “Need to print a check.” That just doesn’t seem to fit. Why not keep the electronic mojo going? Let’s find a way to pay our vendors, suppliers, and agents electronically.
So, the cloud factor will certainly prompt several business into rethinking how they pay; but you don’t have to wait for the cloud in order to make that happen. Cloud programs are not the direct agents of change when it comes to moving away from checks; cloud programs are simply the catalyst for getting people to think and explore the possibilities and benefits of paying electronically ~
More on ePayments:
- Which Should You Use? Purchasing Cards or Virtual Cards?
- How Payments Impact Your Business and Relationships
- Maximize Your Financial Opportunities with Accounts Payable
- The Fourth Industrial Revolution: The Future of FinTech
- How Can Payments Improve Your Bottom Line?