B2B Merchant Acquiring
The world over, cheques do not deliver the bottom line benefits of electronic payment transactions. Specific to accepting card transactions, some of the benefits realized include reduction in Days Sales Outstanding (DSO) and Bad Debts coupled with increases in Working Capital. Still, with these benefits and more depending on the situation, it’s a curious thing that more suppliers do not accept cards. Clearly, the stigma attached is strong and it’s of my opinion that better education is needed.
Depending on your type of business, accepting credit cards as an accounts receivable solution, is smarter than promoting cheques. This is particularly true if your business offers payment terms or factors receivables:
- Accelerates Days Sales Outstanding (DSO)
- Get paid quicker
- Reduce bad debts
- Increase working capital
- Offers substitute to early pay discounts
- Provides revenue assurance against risky accounts
- Facilitates collections more cost effectively
- Saves labour by eliminating invoice production and delivery
- Reduces processing errors
- Eliminates costly background checks
- Reduces hassles and risk of accepting cash on delivery
Let’s face it, most suppliers cite costs associated with accepting cards as one of the top reasons for non-acceptance. Thing is, processing cheques and cash incur significant costs too. So what’s the answer? Start with a comprehensive spend analysis to gain the visibility needed to make informed decisions.
If you’d like to learn more, let’s talk.