Payment businesses are booming, and as corporate service providers, we’ve seen an increase in requests to help with opening them. This is fuelled by growing confidence in digital commerce and demand for ways to pay that don’t involve conventional banks. If opening a payments business is on your radar, you might have a few concerns. Here are some key challenges for payment businesses and how to overcome them.
As the number of online payment business customers increase, so too are the risks that come with it. Financial crime remains a significant issue, for example, money laundering and fraud. As a result, regulators have come down hard on service providers, and they are required to adhere to a long list of obligations. This can be challenging, especially for startups. The key to staying on top of regulatory matters is partnering with someone who can guide you. Fast Offshore has worked with payment compliance for many years, and we can take care of everything you need. From advising you on licensing, company incorporation to your ongoing obligations, we are ready to help.
Additionally, Fast Offshore can keep up with the evolving regulations and ensure you remain compliant. This is a massive relief for many businesses, who often find navigating regulatory landscapes complex and challenging. Considering the growth in the sector, we expect regulation to remain a hot topic, but with our help, it doesn’t have to be a headache.
Cyber threats and security
The cost of consumer data breaches continues to rise, and companies are increasingly affected. Earlier this year, McAffee published a report where they estimated the global cost of cybercrime is over 1 trillion dollars. This damage is caused by various crimes, including hacking, theft, destruction of data, and of course ransom. In the payment sector, particular issues include hacking, the hijacking of data, and identity theft. Not only do these cost payment businesses, but they are a considerable risk for customers as well. The incidence of cyber and security threats also puts people off shopping online and using payment services. They consider the risk too high and prefer to shop in real life.
There are several ways to mitigate this. Firstly, you need to take all the necessary steps to protect your customers. This includes ensuring your site and their data is encrypted and that you’ve taken technological measures to secure their data. You should conduct regular reviews of your systems to be sure there are no loopholes or breaches. Typically software can carry out this task regularly and report back to you. If you store data on servers, these also need to be fully secured. It’s worth getting a professional to ensure sure everything is safe and that you are compliant with applicable laws.
Gaining consumer trust
As mentioned above, it can be a challenge to gain and keep customer trust. Particularly as an online payment provider and even more so if you are a startup or newly established business. Furthermore, if your payment service uses emerging technology, this can also make some people wary. On the other hand, providing an online, tech-savvy startup can bring you many clients, but it can also make some suspicious. One of the critical parts of your success will be gaining customer trust and then retaining it.
You can do this by being transparent with your payment businesses from day one, and ensuring lines of communication are open at all times. Let your clients know what safeguards and precautions you are taking every step of the way, and always own up if you get it wrong. Solving disputes promptly and conceding to keep the customer happy are other sure-fire ways to keep your customers confidence.
In terms of communication, it’s essential to invest in training personnel and engage them through as many channels as possible. Webchat, phone, app, email- all of these should be manned around the clock (ideally) and should aim to respond to all queries within a short amount of time.
The payment businesses sector is booming with more and more service providers entering the market. Trillions are transacted every year, and this is set to continue with no sign of slowing down. This growth means more competition for everyone. But that doesn’t have to be negative. Increased competition means there is lots of room for providers to grow and look to offer new and exciting products. To get and maintain a slice of the market, payment providers should look to incorporate new technologies and stay ahead of current trends.
Typically, consumers will opt for several different payment providers, with each offering additional features or benefits. Technologies to watch include crypto and blockchain-based payments, decentralised operation models, and anything related to the Internet of Things. Other features such as biometric identification and authentication, mobile integration, and low fees are also definite crowd-pleasers. Competition is a good thing- it signals a healthy and robust industry. All you need to do is figure out how to use it to your advantage!
Contact Fast Offshore
There is no better time to start a business than the start of a new year. Fast Offshore is here, ready to field any of your questions and help you get your payments business going. Contact us to schedule a friendly chat to explain your business plan.
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