By Bhaskar Chatterjee
Credit and finance for MSMEs: Customer payments are the lifeblood of any business. In a highly competitive retail landscape like today, not being able to offer flexibility in payment methods may lead to a frustrating customer experience or lost business. The Indian retail industry is growing remarkably and is expected to touch $2 trillion by 2032. The retailers look for omnichannel solutions to leverage sales across various touch points. Over the past years, the payment landscape has undergone tremendous change with new market entrants, technological advances, evolved merchant needs with increased competition, the need for a seamless end-to-end customer experience, and much more. The players in this sector are now focusing on enabling business owners to manage their companies with incredible ease while redefining CX.
A payment aggregator can be the game-changer here. A payment aggregator is one that connects merchants to a broader financial system and enables them to accept various payment methods including credit or debit cards, e-wallets, cash cards, UPI, QR codes and SMS- based payments etc. Though e-commerce giants and large retailers have adapted to this change, SMEs and medium-sized proprietors struggle to fully get in sync with this concept.
A medium-sized business is someone with an investment threshold of not more than Rs 50 crore and a turnover threshold of not more than Rs 250 crore. These retailers are looking for reliable, credible payment providers to elevate their payment acceptance from a mere card-based or QR-based disintegrated payment acceptance to an end-to-end streamlined payment process. Payment solution providers (PSPs) can help them grow their businesses by offering a cost-effective platform to accommodate multiple payment channels. Here are a few ways that can help PSPs provide value to medium-sized retailers:
Any medium-sized retailer looking to expand his business will focus on increasing sales and getting repeat customers. However, with the changing consumer buying patterns, providing a seamless experience is essential not only for sales but also for earning customer loyalty. The payment service providers can therefore offer the flexibility of payment options, which allows the merchants to make the payment process seamless and often attract customers with different payment preferences. For instance, over 12 million Kirana stores or traditional family-run stores in India are mostly cash-based. A PSP can support the unorganized industry players in increasing their sales, by bringing more convenience to its customers via digital payment methods.
Instant affordability solutions, especially via the payment POS or app, can further help retailers sell more by increasing the purchasing power of the customer. In that regard spot card-based offers, easy EMIs, bank and buy now pay later can be helpful for merchants to upsell their products and therefore increase sales.
Simple digital bookkeeping or digital khata within the same payments platform, can help them manage all the transactions and maintain a huge customer base in one place. The payment apps can offer retailers to accept payments from their customers remotely, enabling a hassle-free pay later experience for both.
Ensuring high reachability with customers by integrating with their favourite messaging channels like WhatsApp can help attract a new sales funnel.
Enhanced customer experience
In a highly competitive world, customers come first. Thus a retailer is happy if he can make his customer happy! It is essential for payment providers to know what the retailer’s customers really want. The flexibility of payment methods, easy and quick check-out experiences, support from different banks, and instant affordability/ BNPL solutions are all attractive propositions for an end customer. More so digital receipts and high-touch customer engagement, are some of the other features offered by payment service providers which enhance the customer experience and help in profitable business growth.
Besides, the ability to connect and engage with the customers helps the medium-sized retailer to maintain a credibility score for their businesses. Feedback from the customers and connecting with them for their shopping experience is a great way to engage with them and explore new business opportunities to leverage sales.
Facilitate the ease of operating
Small and medium-sized retailers encounter several challenges and complexities in running and growing their businesses. Maintaining the transaction history, automated billing logic, reporting, and analytics are some challenges they face. For medium-sized retailers, no cash or low cash is a significant hindrance in securing the supply of inventory and other inputs for buying.
An integrated billing solution can help them enhance their business efficiency. If the solution comes with transaction reconciliation, reporting features and monthly reports with a detailed breakdown of all transactions it further helps them keep a track of their account. Payment solution providers can also offer them credit on good terms to simplify the process, besides offering high-security standards for payments while driving efficiency and optimizing their operations. Additional perks like 24X7 support can ensure high up-time and low downtime.
Thus a robust platform which is flexible, secure and supports high-touch service makes it an attractive solution for the merchant looking to enhance his experience and sales. In-app training on several features and offering customized integrations will only enhance the offerings.
When the retailers choose a payment provider and open themselves up to a new payment method, the first thing they need to know is that their solution is secure and trustworthy. Towards the same, PSPs need to ensure a secure, fraud-proof digital payment system with end-to-end encryption, data breach insurance, and AVS/CVV checks. Apart from that, it is crucial that the retailers are educated about this and made aware of the high-security standards of the payment solutions.
With the digital payment revolution, India is on its way to becoming a trillion-dollar digital economy, the small and medium-sized retailers cannot be ignored. The small brands ruling the consumer market is a reality. Thus to lure a retailer, a payment solution provider would need to focus on their needs, while providing them value-added services.
Bhaskar Chatterjee is the VP, Product Management at Ezetap. Views expressed are the author’s own.