14th June, 2018
The number of trading businesses in Australia is on the rise, and every single one of them needs a way to accept payments from customers.
According to the Australian Bureau of Statistics, there were more than 2.24 million actively trading businesses in Australia in June 2017 – a 3.1 percent increase year on year.
But for the new trading businesses, figuring out exactly how to set themselves up to take payments from customers can be a tricky business, whether they’re brick and mortar or online.
Unfortunately, the payments industry can be filled with a lot of jargon and mumbo-jumbo that few people outside of the industry have the time to get to grips with.
For example, when new businesses are presented with a choice between using a payment service provider or a payment gateway they have questions.
The first being “what’s the difference?”.
A payment service provider is a company that acts as an all-in-one solution for handling both payment processing and provides a merchant account.
With a payment service provider, a business does not need to apply for or manage a separate merchant account to hold funds received from the customer before reaching your bank.
Companies like Stripe and PayPal operate as payment service providers.
A payment gateway is specific to websites executing payments online, i.e. e-commerce websites, booking websites (like a hotel), etc.
It transmits data and authorises data the same way a payment processor does without the physical point of sale terminal.
A merchant service facility is an account where you’re the funds provide by customers in exchange for your business’ services or goods are stored before they are deposited to your bank.
That’s right – it doesn’t go straight into your business’ bank account!
But, it’s important to note that not all payment processors require you to have a merchant account because they store it in their own authorised accounts before transferring the money to your business’ bank account.
As the number of payment options continues to go forth and multiply, it’s important businesses get their heads around this stuff.
Once upon a time, the way to settle a debt to a business was through physical currency, then it became the promissory note which morphed into the cheque.
Then it became the bankcard, but who knows what tomorrow may bring?
If there’s one constant in the way people want to pay today – it’s that they want a variety of options for settling their debts.
Whether it’s through bank transfer, cash, mobile wallet or credit card it’s important that you have a solution on tap to lower the walls between your business being paid and your customer paying you.
As a Merchant Service Provider, it’s MYOB PayBy’s responsibility to provide those solutions and to look ahead to see what’s next.
It’s about accepting payments from customers with as little risk as possible by providing the tools you need to safely accept and process payments.
When opening your merchant account with MYOB PayBy, we’ve done our diligence to confirm your business’ validity and provide you access to fraud prevention tools and best practices.
As a business now ready to accept payments from your customers, it’s time to think about the various payment types you should be offering your customers.
For more information visit MYOB PayBy.