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The Top 5 Payment Processing Challenges For Small Businesses

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The GoCardless content team comprises a group of subject-matter experts in multiple fields from across GoCardless. The authors and reviewers work in the sales, marketing, legal, and finance departments. All have in-depth knowledge and experience in various aspects of payment scheme technology and the operating rules applicable to each. The team holds expertise in the well-established payment schemes such as UK Direct Debit, the European SEPA scheme, and the US ACH scheme, as well as in schemes operating in Scandinavia, Australia, and New Zealand. See full bio

Last editedAug 20222 min read

Managing cash flow effectively is the key to healthy business finances. Impediments to cash flow can lead to a range of problems. Employees may not get paid on time, which in turn will affect productivity. Suppliers’ payment deadlines may be missed, leading to a deterioration of your business relationship. A lack of liquidity may also prevent you from making capital investments that could take your operations to a new level of efficiency.

Even if your company pulls in healthy revenue, payment processing issues can stymie cash flow and put a squeeze on your profit margins. By identifying the most common payment processing challenges faced by their peers, small businesses can put a strategy in place to ease cash flow.

Let’s take a look.

1. Integration issues

Your payment platforms need to integrate seamlessly with your existing operations and software. Otherwise, they may add friction to your processes and result in unnecessary processing time and costs. When your payment platform is fully integrated, it allows you to increase operational efficiency. So you don’t have to worry about tedious administrative processes like updating transaction records manually.

GoCardless partners with over 200 software providers, fitting straight in with your existing business processes.

2. Processing costs

Turnover is important. But unless you take steps to drive down operational costs, you risk placing a stranglehold on present and future margins. In today’s digital-first business climate, every business needs to be able to take payments online. But no business can afford to pay through the nose for the privilege.

If you’re paying a high proportion of your revenue to your payment platform provider, you may well find that there are alternatives that offer the same functionality at a much better price point.

3. Multi-channel payments

All businesses want to make it easy to pay in a way that’s convenient for them, whether they want to use a physical credit or debit card onsite, or pay online with an e-wallet. Some may even want to cater to customers who use cryptocurrency.

But if companies use different vendors for different payment channels, the cost and logistical considerations are multiplied exponentially. Fortunately, there are integrated platforms that allow for multi-channel payments. So you don’t need to rely on several vendors or pay several sets of setup and maintenance costs.

4. Security risks

Fraud protection is a serious consideration when choosing a payment partner. Customers expect to be able to make 100% secure transactions through you. Choosing the wrong payment partner could leave an indelible mark on your reputation if your customers fall prey to cybercriminals. Payment Card Industry (PCI) and Security Standards Council (SSC) compliance are absolutely essential. But given that your reputation is on the line, you may gravitate towards a payment platform that goes the extra mile. Point-to-point encryption, fraud management filters and tokenisation are all extra security redundancies that can make transactions more secure.

Registered with the FCA and offering powerful security products such as Verified Mandates, GoCardless is first in line offering highly secure bank payment solutions for businesses of all sizes.

5. Lack of support

Most businesses no longer operate on a 9 to 5 basis. As such, it can be infuriating when their payment partners don’t provide accessible support when they need it most. Delayed or unprocessed payments can put a squeeze on your company’s cash flow and generate friction for customers. Payment processing should be quick, seamless and available 24/7. If you’re not getting the support in and out of conventional business hours, you may need to choose a different platform.

Here at GoCardless, our customer-first approach means that we're with you, every step of the way.

We can help

If you’re interested in finding out more about payment processing issues and how to avoid them, then get in touch with our financial experts. Discover how GoCardless can help you with ad hoc payments or recurring payments.