Online payment challenges and precautions

In the present world, the significant advancements in technology happening daily have also resulted in businesses realising the need to embrace technology and make it a part of their business setup. This has led to the digitalisation of the system of payments on a large scale. However, although e-payments bring along with them the advantages of speed and convenience, it is also worth noting that every payment method carries an element of risk. 

• Online scams and fraud

Fraudsters often find and exploit loopholes in the online payment system. Scams such as telephonic conversations or emails with regard to upgrading of credit cards and the like have often had many victims. Some of the experienced hackers go to the extent of creating a fake payment gateway to divert funds to an unauthorised account, often making customers victims of their online crimes.

One of the most important precautionary measures is never to save card details on random websites. Saving passwords and other sensitive data as well has to be avoided.

• Payment gateway issues

A payment gateway is a channel or interface that enables sending and receiving payments. Often, when these channels experience heavy traffic (numerous people making transactions simultaneously), they tend to have issues where the gateway either fails to load or has frequent timeouts.

This causes issues to the customer trying to make the payment since the payment either fails repeatedly or gets stuck in transit. When the payment gets stuck mid-way, it sometimes takes up to a day to either get processed or return to the payer’s account.

Always research a particular payment gateway before transacting on it. Phishing and malicious websites often disguise themselves well. Therefore it is always advisable to research and then proceed to transact.

• User experience and navigation

The user interface of the app has to be appealing and user-friendly. The whole idea of switching to online modes of payment is the convenience it brings. Apps with software bugs, a lengthy transaction process, and a complex interface often add to the problem rather than offer a solution.

The user interface has to be appealing to both the customer as well as the business owner. It is always advisable to try out a beta version of the app and then adopt that particular service.

• Chargebacks

The third-party providing payment gateway services often charge the business owner a convenience fee for using their payment gateway services. This bites into the business’s profits, which is why businesses are hesitant to opt for online modes of payment. Some of the third parties have also cheated business owners by introducing additional service charges, which cause the owner a lot of inconveniences.

Small business owners must be aware of the guidelines issued by the RBI with regard to payments and fee charges, as well as safety measures to be adopted for digital payments. Through this, small business owners can choose the payment processor that best suits their business needs.