Challenges Of Online Payment- Problems Associated With Online Transaction [Challenges and Solutions]
Table of Contents:
1. Challenges Of Online Payment
2. Problems Associated With Online Transaction
3. What Are The Challenges Of E Payment?
FAQs On Online Payment Security Challenges
1. Challenges Of Online Payment
The success, reach, scope, and ease of online marketing have been known globally for quite some time now, thanks to digital innovations and advancements. And since business is going digital, so are the modes of payment.
But in the real world, though everything sounds promising, digital businesses have hardships of their own. And all of the effort and motivation of a digital business is cut short if any negative impact is felt on the sole purpose of the business – an income.
2. Problems Associated With Online Transaction
Online payment is also familiar with this harsh reality. Many times, payments fail due to technical reasons, and the business owners face the brunt of it. But as we said, we are living in a world of digital advancement, and necessary changes have been made to reduce the occurrence of payment failures.
We know that either you’ve been through it or have been sticking with the traditional methods due to these challenges. You might be surprised by this but we have experienced it too. And hence, we bring to you solutions that can help avoid such payment failures so that you can continue your online business unhindered.
3. What Are The Challenges Of E Payment?
1. Online fraud
Fraud is not new to the world but, shockingly, fraudsters have found and exploited loopholes in online payments as well. This is one of the main reasons that many business owners -- well established or small -- avoid choosing online modes for payment.
But the methods and the related security have been improving ever since. It can happen on either side of the involved parties, the payer as well as the payee.
The most common mode of online payment is card payment and since, in digital transactions, a card is not physically used, it becomes a card not present transaction. In most cases, either the payment is not received by the merchant or more than the actual amount gets deducted from the payer's account.
How To Overcome Problems Associated With Online Transaction?
It can be disheartening to lose your hard-earned money to fraudsters. And keeping this in mind, online payments or card not present transactions have been made secure with a series of improvements. This includes usage of fingerprint recognition, increased level of encryption, the usage of EMV chips, regularly updated norms and passwords, along with awareness on fraud as well.
2. Chargeback
This is another reason that keeps small businesses and local merchants away from online modes for payments. As the name suggests, it is an additional charge that comes into the picture when dealing with online transactions for payment. These are disputed charges that cause reduced credit of the merchant. If timely actions are not taken, these money-based disputes can lead to heavy damage to the reputation of the business as well as the credit score of the business owner. Severe results may include the closure of merchant accounts in some cases too.
How To Overcome Online Payment Security Challenges?
With secured measures being taken and merchants being aware of the charges as well as chargeback fraud, the cases of it affecting business are now reduced. As a merchant or even a small business owner, what you can do is take all the safety measures and follow the guidelines set by monetary organisations like the RBI.
These guidelines educate merchants on how to choose a payment processor that provides effective chargeback management. Apart from this, it advises the payment processor to be compliant with EMV, 2FA technology, PCI-DSS, and others as mandatory measures.
3. Challenges Of Online Payment Gateway
As online payments are becoming popular day by day, there is increased demand for these at local stores and majority online stores as well. In case you are not familiar with the term, here’s what it means – a payment gateway is a middleman that makes sure that the amount from the buyer is securely transferred to the seller’s integrated bank account in minimum time.
They make use of encryption and technical integration to ensure that data is safe and transactions are successful most of the time. However, selecting a suitable payment gateway is still a mystery to many business owners.
How to overcome it?
There are a large number of payment gateway options available in the digital world. Hence, there is a competition to offer the best services at the best prices which makes it tough for a small business owner to choose a suitable one.
In light of this, there are certain checks that every merchant should be careful with to ensure the payment gateway is a suitable one for them. Some of the primary checks are whether or not the gateway is apt for a growing business model, technical integration, security, compliance, payment gateway fees, and support.
4. Continuous update in payment options:
As we have discussed earlier, this is the world of continuous advancements. This is true not only for security enhancements of online payment platforms but also for online payment options and features.
As the world today is adapting to the new normal and getting comfortable with cashless transactions, the same is being demanded at every possible point of sale. From established online stores to local business owners, every seller is coping with the demand to maintain at least one online payment option.
This does not mean the other modes are not favoured or opted for, but the world is now demanding a more seamless, easier, and faster payment method.
How to overcome it?
It can simply begin with understanding what the customer needs and then finding a platform that satisfies the seller as well as the buyer. We know it is not as easy as it sounds and can take a few days to understand it and get it done.
But this is the only option if a merchant does not want to lose even a single customer.
Get in touch with the support teams of top payment gateway processors and understand what they offer that can help conduct safe online transactions to ease the effort of maintaining cash books, passbooks, and even change for cash as a mode of payment.
5. User experience challenges:
Though it is one task to get the business associated bank account integrated with payment processors for smooth online transactions, it is another to make use of an option that is complex or lengthy.
This is important from the seller’s point of view as well as the buyer’s. If the online payment option at a merchant or even a local business is smooth, it automatically lures the customer. With a huge number of transactions happening online, even the sellers and local business owners need an interface that is easy to use.
How to overcome it?
When opting for a payment processor, add it to your checklist to choose a processor that offers a comprehensive user experience.
Just like the buyer requires an easy and quick online payment, so does the seller. Buyers prefer it because the payments are completed in no time and are secure. And businesses prefer it because it offers ease of payment and favours a growing online business curve with an improved credit score as well.
6. Multi-currency payments:
The world is not a stranger to tourism. People love to tour around the world and explore cities and its gems even if it requires wandering in the streets. But it becomes challenging to roam around if there is not enough cash in the pocket.
There can be several reasons for this but it can be a big problem. Hence, having an online payment mode that accepts local as well as international payment is a win-win for both parties involved.
How to overcome it?
If you are a seller seeking to take your business across borders, it is worth having a payment mode or processor that can accommodate your changing needs as well.
So, as and when possible, connect with your payment processor support team, gain the knowledge on how to get it done, ask about the associated charges, and then make an informed decision.
The more informed you are, the better will be your integration and security of transactions, even from foreign credit cards or bank accounts.
Key Takeaways
It is never easy to come out of your comfort zone and adopt something new. But as the world is changing every day, it is also making things easy. So, be informed about technical advancements and maintain your transactions in a smart, safe way.
Also read:
Business Tips: How to Identify A Local Customer?
Tips & Tricks to optimise the Google Maps Listing for Your Business
8 Online Business Ideas That Could Make You Hit Gold in 2020
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FAQs On Online Payment Security Challenges
Q. What Is Online Payment Gateway?
Ans- A payment gateway is an online payments' facility that, when blended with the e-commerce portals, is devised as the medium or channel to make and receive digital payments. After the demonetisation in 2016, the government has been pushing for a less-cash economy which resulted in the promotion of digital payments in India. Starting an online business has become easier since India has gracefully embraced digital payments.
Q. What are the challenges for online payments?
Ans- Some of the significant challenges with online payments include:
- Too slow page loading
- Sudden closure of the page
- Server error
- Unable to complete payment and frequent failure of payments
- Unable to add details of cards, address, etc
- Black hat hackers are experts in technical knowledge and attack through several means, including phishing, trojan, virus, etc.
Q. What are the security issues in e-payment system?
Ans- Some of the common concerns regarding online bill payments are as follows:
- Credit/Debit Card frauds
- Cybercrime
- Data Breach
- Identity Theft
- Swift to follow and Adaptable Crime
- Data Hacking
Q. Is online payment safe in India?
Ans- Digital Payments in India have taken a humongous surge since 2020. Online payments made to authorised shops, sellers, retailers, and merchants are safe. Apart from that transactions done via NEFT, RTGS, IMPS, etc. are also secure due to instant record tracking present in the banks' apps.
Q. Which is the safest online payment app in India?
Ans- The safest online payment app in India is- Google Pay and PhonePe.
Q. What is the safest payment method online?
Ans- Credit Cards are considered to be one of the most secure and safe payment methods whilst making any online bill payment.
Q. Which online payment is best in India?
Ans- These are the top 10 best payment gateway in India (2021) for online payments:
- RazorPay
- PayKun
- MobiKwik
- Atom
- PayU
- Instamojo
- Paypal
- Paytm
- CCAvenue
- Cashfree