Why Online Payments Are a Boon for E-commerce

Why Online Payments Are A Boon For E-commerce

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There's a steady rise in the number of consumers opting for online payments in 2019, with mobile payments seeing an exponential increase. As per a study done by Price Waterhouse Cooper, consumers choosing to purchase through mobile payments have doubled in less than a decade - from 7% to 17%.

If you're an online business owner, it's vital to offer your customers an array of payment options to stay competitive in your niche market. The greater the variety of payment options available to a customer, the higher the customer satisfaction rate. Another added advantage of having multiple payment options is it decreases the time to get payments. Many vendor sites benefit and save time by receiving payments through direct debits from bank accounts or secure phone payments.

If as a business owner, you're wondering how to accept payments online, here are a few options.

Offer an online payment gateway: Creating an easy-to-fill payment form will assist customers to pay directly. Repeat customers can set up an account with their payment information securely stored for repeat payments when shopping at your site. Another option is to outsource the online payment gateway feature to specialist companies dealing in online payment services. This will cover all aspects, from handling the payment form and providing secure payment to securing customer data. The form can also be tailor-made in accord with your brand. Giving customers the facility of an online payment form makes it feasible to receive payments via e-check, debit or credit card.

Online Card Payment: Giving the customer the facility to make payments via a debit or credit card is the simplest way of accepting online payments. If you intend to integrate this feature on your website, you'll need to choose between a holding account held by an intermediary or setting up your personal dedicated business account. Both of these have very different processes, so you need to do your homework and find which is best suited for your business. The top debit cards are Mastercard and Visa, while American Express, Mastercard, and Visa are among the most popular credit cards used across the world.

E-check Through ACH Processing: Another popular way of accepting payments is by directly debiting a customer's bank account through the use of e-check (electronic check). For this, the customer provides the information on the regular check, i.e. name, amount, account number, routing, and authorization, using an online form for payments or an interface. This enables the payment to get processed electronically without any need of a regular paper check. The ACH process is done under the guidelines of the National Automated Clearing House Association with transaction fees (generally lower than credit cards). A bonus is it's swifter and a more secure way to receive payments than getting a regular check via standard mail.

Mobile Payment: This is one of the fastest growing payment modes, and comes in the form of entering a credit card number using a card with a chip or swiping on a variety of mobile devices. The payment is authorized after the customer keys in the PIN. A receipt gets generated immediately.

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The Financial Crisis Of The 2000s

The financial crisis that affected everyone.
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The global financial crisis that took place in 2008, following years of corruption, cost 20 trillion dollars and affected the whole world in a negative way except for a select few. These mischievous individuals were the ones that cost the people of the world their jobs, homes, and wellbeing.

Greed which stemmed from deregulation, was an overarching problem. From 1940 to 1980 the financial industry was regulated. In 1981, Reagan's secretary, who was the CEO of Merrill Lynch, started a 30 year financial deregulation. By the late 1990s, the financial sector was dominated by only a few companies: Goldman Sachs, Morgan Stanley, Lehman Brothers, Merrill Lynch, Bear Stearns, Citigroup, JPMorgan Chase, AIG, MBIA, AMBAC, Moody’s, Standard & Poors and Fitch. If they failed, everyone would be affected.

Years before the inevitable Great Catastrophe, people, who wanted to take out a mortgage, would be thoroughly analyzed by the bank. It was vital for the bank to get its money back as well as interest. Then everything suddenly changed. Everyone was being given a loan without question. It did not matter if they were employed or not or if they were going to pay it back. The burden no longer rested on the bank. Instead of selling to local investors, the bank sold the unpaid notes to investment banks which sold them to investors with the help of a bribed rating agency. These mortgages or other loans were called CDOs: collateralized debt obligations. CDOs were also referred to as derivatives. Even the riskiest subprime loans were given AAA ratings which resulted in many people not repaying them. This was detrimental for the investors.

The credit default swaps, CDS, were similar to a sort of insurance. They were used to bet against CDOs. If a CDO went bad, they would pay for the losses. Goldman-Sachs was aware of everything it was doing but with CEO Henry Paulson, it sold more than 3 billion dollars of CDOs. These were still given a AAA rating since the rating agencies was accepting bribes. The more money the customers lost the more money they made.

Individuals like Henry Paulson were stealing and ruining the economy in a worst way and no one was doing anything about it. The few that wanted the financial sector to be regulated were unsuccessful. The derivatives made the markets unstable and even Warren Buffett called them “weapons of mass destruction”. It was as if the bankers could gamble on anything. Congress banned the regulation of derivatives. Even president Obama would voice his opposition to the way the financial sector worked but during his presidency he would appoint the same people who worked for these massive companies to save the American economy.

The prices for houses in 2001-2007 had increased dramatically. As people on Wall Street, such as employees of Goldman-Sachs and Merrill Lynch, were getting huge cash bonuses they were aware of what was about to happen. The ultimate crisis began in the November of 2007. Bear Stearns collapsed in the March of 2008. The government now had to do something since the world’s economy depended on these firms. Fannie Mae and Freddie Mac were taken over by the government and bailed out by the tax players. Lehman Brothers was taken over as well and Merrill Lynch was bought by Bank of America. The commercial paper market catastrophe was decided by non other than Henry Paulson and Timothy Geithner.

Large amounts of people were losing their houses and foreclosures ran high in numbers. The poorest people payed the most. At the same time, the men who decimated the banks walked away with large sums of money. No one was given jail time. No one received any charges. No one was held accountable. The American government even kept and appointed executives from these companies year after year.

There was nothing ethical about the entire situation. The greedy CEOs and executives ruined the economy and people's lives. It astounds me that after all the scandals, the American government still appointed these executives to direct the country's financial sector. Regulation is key. The government must hire workers who are truly not in it for the profit to oversee these large firms.They must learn from their past mistakes. Hiring the same people who have to same agendas is not going to produce different results.

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Dave Ramsey, Thank You For Sharing Your Money Tips And Knowledge With The Rest Of Us

From just starting your program and being only on baby step one I have realized many things.

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Ever since starting college I have always had that thought in the back of my head about how am I going to pay off my student debt after getting out of college. This is probably a thought that every student has when they attend college and they know that after they receive their education that they are out in the real world where they have payments to make every month and probably be in debt for most of their life. But after watching your podcast and following your Instagram and seeing all these people paying off hundreds of thousands of dollars in a couple of months is very inspirational.

Paid off student debtDave Ramsey Instagram

From just starting your program and being only on baby step one I have realized many things. One, I spend money on a lot of things that I don't need but never realized until I started tracking my spending to make a budget. Two, saving a thousand dollar before actually tackling your debt is a great task as it shows that if you can save a thousand you can find a way to pay off your debt then. Though it does seem like a long process that doesn't seem possible till you finally hit the triple-digit mark. Three, you don't actually need a credit card in life because you will actually have money you can spend instead. Though I am still wondering how exactly this would work later on with wanting to buy homes and cars.

But overall thank you for sharing your story and knowledge about money and your experiences so others can learn and do better with theirs. So let's all be weird and not broke as you like to say.

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