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Jul 01

How the Pandemic is Changing the Way We accept Payments

Reading Time: 4 mins

With the onset of the pandemic, we witnessed the fastest and largest drift of businesses from in-person payments to contactless forms of payments. The acceleration was due to an urgent need to keep their businesses afloat. There was no telling when stores or offices would open. And so, the only way to reach consumers with services was by adapting to new and existing methods of payments.

Online payment platforms have become the new trend with various businesses. It is without a doubt the fastest and most secure form of payment. There are some risks involved, but with the current situation, companies must adopt strict security measures. What has changed about the ways we make payments?

 

Credit Card Payments

The pandemic left many caregivers and providers without jobs due to the shutting down of many stores, offices, and organizations – many of which didn’t have enough savings or plans for an unexpected lockdown. It, however, did not stop the bills and interests from piling up. Many people resulted to the use of credit cards for payments and purchases.

Organizations that usually refuse credit cards had to begin accepting such payments. It was essential to set up the tools that could allow for credit card payments. Many organizations now see the ease, speed, and benefits of payments made and are beginning to expand their horizons digitally. With constant use, it became evident that payments through these methods were the future of the business world.

The beauty of it all was that people no longer had to leave their homes but could make orders over the phone. Payments were better managed and organized, and they went straight to the accounts.

It was also evident that the customer base of companies with credible online payment systems grew in geometric progression. If you needed good service and your store had no online payment platform, you had to go to a shop with such services.

Credit card companies also implemented financial relief plans to help cushion the effect of the pandemic. These policies were deferred payments, payment waivers, and reduced annual rates.

 

Digital Wallets

The Digital wallet is a software-based and controlled system. It operates a system that is encoded and secure. The passwords and payments information for customers is saved on the software. It makes it easy to make payments without having to carry your debit or credit cards from one place to another. Some features of the digital wallet include

  • It is an independent payment platform.
  • You can make transfers from one digital wallet to another. You can also transfer money to people’s bank accounts.
  • You can pay money into your digital wallet from your bank account.
  • Bills, shopping, and other payments are possible on this platform.
  • It operates a self-registration system, so your information can only be accessed by you.
  • It can be accessed using your mobile phone or laptop from anywhere in the world.
  • There are no restrictions on micropayments and transactions.
  • You can also store gift cards, insurance cards, movie tickets, airplane tickets, etc. in the digital wallet.

The pandemic has amplified the need for digital wallets and their acceptance. As the pandemic continued to linger, more people began to seek out means to make payments for transactions online. The digital wallet proves to be one of the safest ways to deal online.

However, many argue that some wallet companies sell off private information to companies. These companies then use the information to update their marketing methods. The information derived makes them aware of the purchasing habits and power of consumers.

Some digital wallets allow you to participate in global trading platforms and financial markets.

However, there are three categories of wallets, closed, semi-closed, and open wallets.

Closed wallets – these are e-wallets issued by a provider and can only be used on the payment platform of the provider. These wallets are for making payments for goods and services provided by the issuer. Such wallets are used by companies that sell competitive products. They make them enticing by offering discount sales and lots of bonanzas. Two transactions are possible with such wallets.

You can withdraw money from the digital wallet into your account or pay the provider for a service rendered.

 

Semi-Closed Wallet – these are e-wallets issued by the provider, and they allow you to use them on permitted platforms. The provider gives you access to platforms with whom they are in partnership.

 

Open Wallet – these are wallets issued by core financial institutions like banks. They give you access to any trading, business, or payment platform you desire. You can receive cash transfers and make payments using the wallet. Before the pandemic, there was a growing awareness of such platforms, but many regarded it as a second option to other payment methods. The pandemic further showed the need for the application of digital wallets.

Most organizations today have created digital wallets. It is believed that in the future, online payments will be made with digital currencies.

Some examples of wallets include.

Apple pays – It is exclusively for iPhone, iPad, Apple Watches, and MacBook users.

PayPal – this software helps you make and receive payments. You can also make money transfers from your account to other accounts. You, however, get charged a little sum on every transaction. The account is free, and you can have it for as long as you want. You can connect it to your bank account, credit, and debit card.

Google pay is also commonly used for transactions. It is applicable on several platforms like YouTube, chrome, android phones, etc.

The cryptocurrency world is hinged solely on wallets. Those who deal in cryptocurrencies use wallets to store their coins. Most banking and financial institutions haven’t fully welcomed the idea of cryptocurrencies because of their instability. So, crypto dealers and traders procure coins and save them in wallets. These traders can trade with the digital coins in their wallets anytime they want.

The pandemic experience has opened the eyes of many entrepreneurs to the poorly tapped resources of online business. The emerging payment options make it easy to do business across borders without fear.

It was a task previously left to vendors and large firms, but not anymore. The possibility of reaching the world with your goods and services without making physical contact has led to the birth of many small-scale industries.

This change has come to stay, and the world will be better for it.

 

Disclaimer: MoneyMagpie is not a licensed financial advisor and therefore information found here including opinions, commentary, suggestions or strategies are for informational, entertainment or educational purposes only. This should not be considered as financial advice. Anyone thinking of investing should conduct their own due diligence.

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