By Marina Joseph – Art in Tanzania Internship
Digital payment, sometimes called electronic payment, refers to payments conducted over the Internet and mobile channels. Hence, any payment sent online or through mobile computing and Internet-enabled devices can be called such. And with several cultural, societal, and technological worldwide trends intersecting, we’re now seeing the demand for electronic payments increase. Digital payments significantly benefit individuals, companies, governments, or international development organizations. 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 money
We will focus on the last two benefits for this post
- Saves time
Valuable time is saved as customers swipe or tap to pay. 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 give your company a good review online.
- Saves money
There are no additional charges when accepting contactless payments once the chip and PIN is accepted. You’ll pay the same as you would for regular card transactions. There are plenty of packages out there to cater for 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 also cost less with digital payment.
MEANINGFULNESS OF ONLINE PAYMENT TO RURAL COMMUNITIES
Digital payment expansion to rural customers or areas has challenged 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 is the meaningfulness of online payment to rural communities.
Easier Access to Economical Facilities
People from rural areas struggle to get their wages paid and get their pensions. It is even more challenging for them to be aware of benefit schemes for which they are eligible. With mobile banking, speed is achieved, which solves their problems. In addition, reduced transaction and travel are other benefits.
A Boost to Rural Businesses
Mobile banking has various aspects, such as e-commerce and instant digital transactions; once the rural population gets more comfortable with it, they can use 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 redirect to other activities.
Financial Inclusion
The rural population must travel long distances for even the most straightforward financial services. Digital payments make it possible to use your phone to avail yourself of various financial services.
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