By Marina Joseph – Art in Tanzania Internship
Marketing and Management programs
Digital payment, also known as electronic payment, refers to transactions conducted over the Internet and mobile channels. Hence, any payment sent online or through mobile computing and Internet-enabled devices can be called such. With several cultural, societal, and technological trends intersecting worldwide, we’re now seeing an increase in demand for electronic payments. Digital payments significantly benefit individuals, companies, governments, and international development organisations. The benefits of going digital include:
The need to handle cash is significantly reduced
More hygienic
Transparency and security by enhancing traceability and accountability, reducing corruption and theft.
Financial inclusion by increasing access to a range of financial services, including savings accounts, credit, and insurance products
Saves time
Saves moneyWe will focus on the last two benefits for this post
Saves time
Valuable time is saved as customers swipe or tap to make a payment. No more digging through wallets or purses looking for coins – sellers don’t need to count out the correct change when someone pays for a low-value item with a large note. Searching for small notes, counting out exact changes, and writing checks require more time and energy. Paying via card, contactless, mobile wallet, or wearable device is almost always faster than cash. Customers could use that time to converse with your staff, enrol in your loyalty program, or leave a positive review online.
Saves money
There are no additional charges when accepting contactless payments, provided the chip and PIN are accepted. You’ll pay the same as you would for regular card transactions. There are numerous packages available to cater to businesses of all sizes, budgets, and transaction volumes. While some are hesitant to switch over for fear of fees, the Visa data showed that processing digital payments was 57 per cent less expensive than non-digital payments once fees and labour costs are accounted for. Expenses related to fraud are also rreduced withdigital payments
MEANINGFULNESS OF ONLINE PAYMENT TO RURAL COMMUNITIES
The expansion of digital payments to rural customers or areas has presented a challenge for financial services providers in developing countries. However, such institutions are motivated and willing to go through it because of what it will mean to rural communities. This is because when such services expand to rural and remote areas, there is promise for development and growth in several ways.
The following outlines the significance of online payments to rural communities.
Easier Access to Economic Facilities
People from rural areas often struggle to receive their wages and pensions in a timely manner. It is even more challenging for them to be aware of the benefit schemes for which they are eligible. With mobile banking, speed is achieved, which solves their problems. Additionally, reduced transactions and travel costs are other benefits.
A Boost to Rural Businesses
Mobile banking encompasses various aspects, including e-commerce and instant digital transactions. As the rural population becomes more comfortable with it, they can utilise the same technology to grow their businesses. This is due to the availability of better reach and convenience.
Hassle-Free Bank Accounts
The location of bank branches in rural and remote areas may be very far away, but the use of digital payments helps people set up bank accounts without having to visit the bank branch. It helps them save time, money, and energy and redirects them to other activities.
Financial Inclusion
The rural population must travel long distances for even the most straightforward financial services. Digital payments enable you to use your phone to access various financial services.
