10 Best Digital Payment Choices for MSME

Here, I have briefed about 10 best digital payment choices for MSME and other businesses. You might have noticed that if payment and transactions are smooth in any type of business it means that business is successful. If payments have to go through a lengthy process or consuming a lot of time, it means the business speed is low.

What is MSME? – A brief | 10 Best Digital Payment

Micro, Small Medium Enterprises – MSME’s are considered as the backbone of the country. They are contributing heavily to the socio-economic welfare & development of India. MSME is a crucial role player in the Indian economy.

These enterprises have generated a bouncing number of employment opportunities. Not only this, but they have worked hand-in-hand with the nation’s rural & backward areas where the government finds difficult to reach & serve timely.

In India, the contribution of MSMEs is nearly 8% of the GDP of our country, In manufacturing, MSME contributes up to 45% of output, whereas if we talk about the export industry of India MSME has been contributing approximately 40%.

10 Best Digital Payment

Under the development act of 2006, the government of India introduced MSME & had an agreement with Micro, Small and Medium Enterprises Development (MSMED). These MSME enterprises engage majorly in manufacturing, production, preservation of goods & commodities & processing.

An annual report (2018-2019) by the government of India states that the total number of MSME in India has a total count of 6,08,41,245 & is expected to increase at a rapid pace.

What is MSME

MSME Going ahead with Digital Payment

Nowadays, Digital payment technology such as wallets, payment gateways, UPI payments etc.  have created significant value for MSMEs in India.

50% of MSMEs are currently utilizing the power of digital tools for their business processes, online payments, & eSales. Besides, around 9.2 million MSMEs could be the potential market in the near future that has gotten registration under the GST.

A study has revealed that there is a high level of user satisfaction by MSMEs using digital payment technology. According to a survey, among the respondents ¾ have shown full satisfaction with the digital payment technologies while half of them have agreed to the value-addition of payment gateways for their business.

In today’s day & age, consumers have become more advanced. They prefer online transactional convenience. 20% of MSMEs have seen a growing value of customer preferences for online payment methods using digital payments.

Also, the monetary incentives for the customers have created a wider value for around two-thirds of the Micro Small Medium Enterprises.

MSME digital payments | Understanding significance & level of digitization.

Rightly said by Natarajan (CEO & MD of TCS) – That it is necessary today to go digital, you have no choice left. With the wave of digitization, business operations have transformed & have created a great shift in the payment spectrum too.

Therefore, to continually thrive & foster their business verticals inclined to forward direction, MSMEs have to pave their path to digital technology.

MSME digitization

Source: Credit disrupted

What is the need of the hour that MSMEs must adopt digital payment methods? Well, for our economic growth, MSMEs are the torchbearers.

It deals with impediments with payments throughout the course of the day. In 2014, the World Bank reported that over 35% or let’s say one among every three MSMEs receives payments approximately over 90 days or even more.

These delays in payments have adversely affected MSMEs because it locks up 15-20% of the business cash flow, which eventually results in making it tough to continue the business.

To commute to this situation, MSMEs are strongly recommended to adopt digital payment methods.

Benefits of digital payment

Source: SME digital payments

Expansion of MSME in this competitive world is paramount to the venture and the capitalization of the benefits offered by digital payments to grow their business.

But in order to adapt to various digital payment options available in the market today, MSME must analyze on their current state as per their business operations.

A preliminary evaluation & analysis will help MSME to go ahead and build a successful path to digital transformation by carefully selecting their pay tech partners & enjoy the numerous benefits of going cashless.

How to set up online payment for small businesses? | 10 Best Digital Payment

Best digital payment

If you have a small business & you want to set up a website with a payment gateway option for cashless transactions. There are 2 options – first, do it in-house or outsource a trusted pay tech partner for your digital payment solutions.

To get an all-in-one solution,  you can refer to services like PayPal and ProPay that can help you accept the electronic payment method easier to process.

There are plans on which these services operate and have transaction fees for each payment made by a customer on your site. After authorization & transaction done by the customer, it adds the amount to your account.

You must have a Secure Socket Layer (SSL) technology if you wish to process payment by your internal IT team. This SSL certificate can be applied online & is used for data encryption.

After having a secure server, your eCommerce website is ready for customer purchase & payments. Now, after a customer makes a purchase, for payments they will be redirected to a secure payment page through a secure server. There are also some businesses that opt to accept electronic checks from their customers.

10 Best digital payment choices for MSME

Help your client & customer for a convenient payment option by enrolling your small business into an online payment service. Take the stress out, and choose among the below-mentioned payment options that can handle your business transactions very securely & conveniently. What more do you need? Right?

1.     Amazon Payments

It is a very business-friendly option, especially for small businesses. You get payment online instantly. Easy integration with your website. Payments accepted for a lot of digital services & products.

2.     Apple Pay

A superb choice for small businesses. With this option, you can use your Apple devices as a POS machine. You can also receive payments via this device. As soon as you receive the money, you can transfer it to your respective bank accounts. You can also make purchases and use the money received online.

3.     Authorize.net

It is a payment gateway service provider. If you have an existing merchant account – this option lets you accept credit cards and even electronic checks via your website.

Its service has a variety of offerings for mobile payments and E-Commerce solutions.

It also offers virtual POS or Point Of Sale for retail locations. Nonetheless,  it also allows you to connect a card reader for any transactions for your store using your computer.

4.     Intuit QuickBooks Payments

Streamline your invoices & get paid faster – direct integration available. Just sign up from your merchant account & all these services allow you to get paid online through generated invoices via a credit card.

Customer can access its 24/7 online & personalized Customer Account Center. The Web page is password-protected where customers can check their billing history and accordingly pay their invoices.

5.     PayPal    | 10 Best Digital Payment

An online payment option which is most popular.  It has helped approximately seventeen million businesses with their payments services and credit solutions. Without a traditional merchant account, a small business can accept & receive payments across the globe.

Through PayPal business services, one can easily accept credit cards online or even through the phone. Quickly generate and track invoices & get paid super faster.

6.     WePay

It is a payment processor which provides users with complete control over the experience. Its payment system can resonate with the design of your website through customisation, extending your brand value.

With a mobile chip card reader, you can easily get on-the-go payments. Users have the power of embedding the payments into the mobile app for complete user exploration.

7.     Google Pay

An online payment service with a capability of transferring secure, easy, and fast money transfers from your browsers, smartphone, & Gmail. You can store all types of cards in your account – credit cards, debit cards, loyalty cards, and even gift cards.

It has multiple layers of security so your payments are secure. Even your customers’ accounts are safe. Also, Google Wallet also lets you send and receive money through your email.

8.     Square

It is PayPal’s major competitor currently and it is offering transaction rates at a rivalry rate to the industry leader. It also offers you an online store site where you can list and sell your products & services. You can easily send and request payments on bills & invoices.  The company also offers credit cards in person.

9.     Stripe

One of its kind, Stripe design its checkout form in such a way that the customer does not get redirected to its website but stays on the seller page. Just embed Stripe payment forms on your website & you are good to go and accept online payments from your customers. It works across multiple devices with no extra effort from your end.

10.  Shopify

When you hear of point of sale systems in E-commerce, you must have heard of Shopify. You can easily set up an online store & host it on your own domain.

You got 3 tiers of monthly payment options. Therefore, the more you pay – the less you get the transaction fees cost.  A fabulous back-end is provided which can help you track all your customer information like sales, payments, etc.

Conclusion – Digital Payments (e-Payments) are Helping Transform the SME Industry

A complete digital transformation process is ongoing in India backed by 108 crore smartphones,  & 50 crore internet users. Post demonetization, digital transactions have increased a lot.

There are payment solutions providers developing the best of online services with modern payment mechanisms. This payment technology has been catering to the needs of MSMEs.

The main discussion is to understand pay tech & select the right pay tech partner in order to unlock the true value of digital payments. Fintech players usually focus on digitization of the transaction flow. They have immensely helped out the businesses to request and send money with zero mobility with a single click.

Sure, there are market players like PayPal and Square. But when it comes to accepting payments with digital payment options & accepting payments from clients & customers, MSMEs needs to understand the needs and adopt only those options that are best fit for their business & client preference.




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