As a business owner in an APAC market, you must ensure that your payment infrastructure is optimized for cash flow. But how can you make the procedure as simple and convenient as possible for your customers? This challenge leads us to payment optimization—the process of optimizing the numerous aspects of your payment processing.
Since the outbreak of COVID19, ecommerce across APAC has been growing exponentially, and ever since, digital payments have become a must and, more importantly, the way to pay.
Alone in the e-commerce sector, it is expected to reach approximately US$2,139 billion in 2023 and is expected to see an annual growth rate of 11.7% up until 2027. That is excellent-and probably unsurprising-news for all merchants worldwide who, if they have not already done so, would want to break into such a market.
Even if they do, local acquisition is never top of mind for merchants, and in a digital payment hub like APAC, this may have a big implication for business bottom-line revenues, not to mention the relationship with customers.
The Rise of Digital Payment Options in APAC
Card transactions across APAC are expected to continue at a CAGR of 12.9% till 2025, reaching $39.7 trillion by 2025. Other alternative modes of payments are in many forms. Online and offline payments across APAC even now are being driven by credit and debit cards. Major card schemes operating in the region include VISA, Mastercard, CUP, and JCB.
If one takes, for example, Singapore, the card takes up 68% of all online purchases. In Australia, the share comes to 50%, while in Hong Kong cards have a usage rate of 93%. This would mean that by 2025, three-quarters of the alternative e-commerce payment methods and over half of all point-of-sale payments in the Asia-Pacific region will be taken through a digital wallet.
In other words, card payments in APAC are not going anywhere, which makes it more vital than ever to use a payments platform that’s able to provide local acquiring in these regions.
How Can You Optimize Payments?
1. Diversify your Payment Options
Customers expect to pay with whatever they have on hand, and they may feel humiliated or inconvenienced if their preferred method is not accessible. Remember the last time you went to pay with a mobile bank and realized the establishment only accepted cash?
Offering a variety of payment alternatives is an excellent way to reduce friction while accommodating varied consumer preferences. Whether it’s credit cards, debit cards, mobile wallets, or online payment platforms, offering additional payment options can boost customer happiness, improve payment speed and consistency, and increase the average ticket per transaction.
Furthermore, if you run an internet business in a country like Nepal, you should think about allowing international payment methods to attract more worldwide customers and broaden your market reach.
2. Utilize Mobile Payments
Accepting mobile payments has become increasingly common as the number of people using smartphones grows.
Your clients will be able to make purchases more conveniently and securely if you provide mobile payment options. These mobile wallets are extremely popular among Generation Z, with more than 70% of them using Apple Pay to make a purchase while it was available.
This not only enhances the whole payment experience, but it also allows you to enter the mobile-driven industry and remain competitive in the digital era.
3. Identify Key Service Provider Partners
Identify a wide range of relevant global, regional and local service provider partners to be contacted for a provider overview. Consider the different business models and service levels but also the capabilities offered by the providers including alternative payment methods and routing mechanisms supported.
While certain markets, like Australia and Singapore, are generally constituted with global providers operating in them for easy integrations, other countries like South Korea and China are usually dominated by local payment providers. Hence, resources need to be invested to find the best-suited localized integrations.
Any prior infrastructure payment analyses for the various markets should be factored in to devise a systemwide payment acceptance strategy that minimizes compromise in the customer experience related to checkout, considering the POS, mobile payment solutions, and online gateways.
4. Reduce the ‘time to collect’ per Payment
A lengthy payment collection process can result in delayed cash flow, compromising your company’s financial health. Cash flow issues are responsible for more than 82% of small business bankruptcies.
As a result, when optimizing payments, you should aim to reduce the ‘time to collect’ per payment. This can be accomplished by streamlining invoicing procedures, providing simple means to pay invoices, offering incentives for early payments (or penalties for late payments), and employing automated payment reminders to encourage consumers to pay on time.
5. Minimize Transaction Fees and Costs
If transaction fees and processing charges are not factored into your business’s budget, they can have a substantial influence on its profitability.
To accomplish true payment optimization, you should analyze and learn about your merchant account statements on a frequent basis, as well as look at ways to cut transaction fees. Small changes in processing costs can result in significant long-term savings.
How Lambda Payments Can Help Optimize Payments For Your Business
Rather than simple transaction processing, Lambda offers comprehensive payment programs for each customer. The consulting will sort out the regulations, while suites of applications will start developing to handle different payment scenarios.
Lambda provides a fully developed technical solution that integrates old systems with new infrastructure. Most of the platform integrations can be done using APIs, and workflows get automated, helping to pace up the procedures. Full control and transparency are there in the partner portals.
Lambda Payments offers seamless 24/7 support from in-house developers: from a dedicated team answering phone calls and online chats to self-serve help center materials, whether the difficulty is technical or in customer support. Besides, seminars and training onboarding will keep partners abreast of the latest sector developments.
Hence, Lambda supports customers’ business requirements globally by being at the forefront with workable solutions.
