Digital payments: a key to success for entrepreneurs

The transition from cash payments to digital payments represents several benefits for entrepreneurs round the world thanks to the rapid increase in those who own smartphones and therefore the diversification of options for electronic payment forms.

However, digital payments are still an underdeveloped commercial tool that may provide important benefits for both entrepreneurs and society normally, by incorporating more people into the formal national economy.

In Mexico, where just over 40% of the population is banked in keeping with the newest National Survey of monetary Inclusion (ENIF) , driven by the coronavirus pandemic, electronic commerce had an estimated growth of 32% in line with the “Report of ecommerce 2020 ”by Statista. In other words, last year, online payment sales exceeded $ 18 billion, that is, 4 billion over in 2019.

In that sense, despite the low bankarization rate currently in Mexico and also the persistent barriers to the event of online payments like cybersecurity and inefficient logistics distribution, by the tip of 2021, the quantity of users is predicted to of those means of payment grow to 50.7 million people, which represents an annual increase of 8.9% and a penetration rate of 39.9%. In fact, the Mexican Online Sales Association (AMVO) maintains that electronic payment means became one in every of the keys to the expansion of commerce.

The greater the efficiency, the greater the advantages

Digital payment systems benefit a little fruit vendor, a medium-sized factory manager, or a caregiver together with his or her own office alike. When an entrepreneur can easily monitor their daily sales through digital payments and collections, they’re also in a very position to more effectively manage inventories and increase profit margins. Also, by participating in e-commerce through digital payments, this entrepreneur can broaden his customer base and visibility, thereby gaining the power to further develop his business.

According to AMVO, the pandemic increased the relevance of digital sales within the business strategy of any company to such an extent that, last year, two out of ten businesses experienced growth greater than 300%. Along these lines, in line with a study by the Boston Consulting Group, companies with digital platforms obtained 1.8 times higher revenues compared to those with little digital development, especially during the primary two months of the pandemic.

Electronic payment methods became one amongst the keys to the expansion of commerce

In this sense, SMEs with platforms specialized within the automation of payment collections like Flexio obtain facilities with reference to income management. additionally, the manual billing system is commonly susceptible to errors and causes an opening within the payment wheel. additionally to the present, persistently entrepreneurs must track suppliers in search of invoices or follow delinquent clients. Thus, SMEs lose between 8 and 19 hours a month that would be used for planning and detecting new market opportunities.

Thanks to the digital leap, by 2021, e-commerce is anticipated to represent 30% of their total sales for 2 out of ten companies, per AMVO statistics, an entity that has also ensured that nine out of ten users who buy for the primary time on the web they are doing it again within the short term.

However, the advantages of digital payment and collection platforms aren’t only reflected solely within the accounting of companies or businesses. In fact, consistent with a survey by Mastercard, 70% of individuals think that digital payments are going to be permanent for the longer term, with which we also are facing an obligation for those companies that want to require advantage of the competition.

In summary, with digital payments, entrepreneurs and SMEs of the world that they were obtain various benefits, among which are the automation of collections and payments, which suggests that those gain time that they’ll use to enhance their services and products while, at the identical time, they improve the user or customer experience, who is increasingly searching for greater facilities.

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