For a company to survive and thrive, leadership has some very specific responsibilities. This includes saving money, handling accounts receivable, and reducing company debt and Days Sales Outstanding (DSO). As means of reducing DSO while boosting cash flow, a lot of companies now accept electronic payments.
Common online payment types include credit cards, debit cards, and eChecks (ACH payments). When making the decision to accept online payments or change providers if a credit card processor is currently used, some very important features should be included.
- Security – In addition to convenient payment technology, companies have to be even more responsible in how a customer’s sensitive payment data is protected and secured. Both Point-to-Point Encryption (P2PE) and tokenization technology protect against any fraudulent activity. P2PE makes the transmission of data between parties secure, which protects sensitive information obtained but also transmitted using electronic transactions. For instance, data from credit cards is encrypted with P2PE, starting from when a card is swiped all the way to authorization. Tokenization is used to submit the Primary Account Number (PAN) of a customer using a token. Because of this, information is of zero value to hackers. With both of these in place, cost and scope of PCI compliance is dramatically reduced.
- Compliance with PCI – It is essential to build customer confidence, which can be accomplished by complying with extremely strict regulations and standards of a high-quality management organization. Simply put, to accept payments, a company has to be in compliance with what is known as the PCI Data Security Standard. This standard was developed by the PCI Security Counsel and is updated every year. An actionable framework is provided when developing a powerful and efficient process for payment card data, including not just prevention but also detection and appropriate action for different security issues. At the very least, merchants are mandated to complete a yearly Self-Assessment Questionnaire (SAQ) to ensure PCI DSS compliance. For this, all necessary steps have been taken by a PCI compliant processor using only the highest levels of security that ensure the security of all proprietary business information. The processor should provide responsible merchants with assistance and guidance in completing the SAQ if needed.
- Fewer Days Sales Outstanding (DSO) – The number of days it takes for a company to collect on money due is the Days Sales Outstanding. Once a product or service has been purchased, it can take anywhere from 30 to 90 days or more to receive a check from the customer and wait for the bank to clear it. Options that are more efficient include eCheck payments and credit card processing. Using these payment options allows for immediate collection of money due, which in turn reduces DSO and increases cash flow.
- Payments via eCheck (ACH) – In this case, a check routing number or account number of the customer is transmitted electronically through an ACH system. The result is a much faster transfer. Many times, a company will use this type of payment processing for direct loan, mortgage, bill, and rent payments; for employees’ direct deposit; and with some e-commerce payments. eChecks are faster and cost less than a traditional check. Overall, this saves the company money, improves overall customer service, and boosts profits.
- Reconciliation – Being able to have a detailed report in one location, regardless if payments go through a single or multiple channels, is essential to success. Because most payment processors are both gateway providers and processors, few allow a transaction to be tracked from inception to settlement. In comparison, when reporting application programming interfaces (APIs) are offered by processors, a company has access to a wealth of information on any one transaction and at any point during the transaction. In fact, APIs can easily be customized according to every company’s need.
Although there are different processing services to consider, Chosen Payments stands out. As an agent and partner of a leading national ISO, this company understands that often, too many important details are kept from sales agents. By becoming an agent, you are treated like a partner, which means that key decisions are made as you deem appropriate. With Chosen Payments, pricing, contracts, and your company’s success are literally in your control. For all types of payment processing options, this service is superior.