What are the best bulk payment solutions for Africa?

Businesses across the African continent are always looking for ways to not just broaden their reach but also transact, pay suppliers and staff, as well as settle other bills. A single payment is often the easiest for a business to complete; however, growth means that your business may have to start adapting to making multiple payments at a time. In this article, we will discuss bulk payment solutions, what they entail, how they benefit businesses and the many solutions and offerings that exist to offer you easy access to transacting in your business.

Bulk payments, explained
Processing payments is standard for most, if not all, businesses. But oftentimes, this process takes enormous amounts of time as well as resources, especially when done manually. When completed inaccurately, manual work can lead to errors and delays that result in administrative overload and fraud risks. Bulk payments (also known as bulk transfers, mass payments, or batch payments) are payment management solutions that help companies settle multiple bills to vendors and suppliers at once while processing them in real-time.

Online transactions have since become the norm more than an option, with the new normal having been ushered in by the global Covid-19 pandemic. Many businesses have had to adjust how they function, and bulk payments ensure that transactions take place with ease.

Why bulk payments?
Check payments might take hundreds of hours to process. Bulk payment solutions streamline the procedure by handling large numbers of payments at once, saving you a tonne of time and enabling your organisation to run more successfully. Spending less time writing checks frees you more time to concentrate on the business at hand. You can also schedule bulk payments ahead of time so the recipients are never left waiting.

Although there may not be an explicit direct line item for the costs, difficulties, and hazards of cash transactions on the profit and loss statement, they are nevertheless very important. According to World Bank research, the expense of managing cash in Tanzania and Uganda may amount to 7 to 20% of total yearly business revenue. Cash is not fully recommended for transactions because:

It is costly – Businesses must incur considerable expenses to carry, keep, and protect cash used to pay distributors and suppliers directly or at cash distribution points.

Cash that is not protected creates issues with theft and personal safety.

Cash payments are more vulnerable to fraud and leaks since they are untraceable.

Ineffective – It is obvious that managing cash is ineffective for businesses.

Businesses and fintech companies prefer bulk payments as they:

Reduce transaction time

Expose businesses to less fraud

Are traceable, transparent, and there’s accountability in the reporting process

Cost effective

Less prone to errors

A lot of people in Africa do not have access to bank accounts; therefore, bulk payments are helpful in this regard. There are three types of outlets that make bulk payments easy for businesses:

Bank transfers
This is probably the most common one as many people prefer using it due to how fast and effective it is. Bank bulk payments also offer cost-effective transaction fees and make it easy for businesses to track transactions. Safeguarded with verification processes that are made to retain your finance’s safety, bank bulk payment methods have a quick turnaround time and require both you and whoever you are transacting with to have bank accounts.

Credit card and debit card payments
This method is favoured by businesses because credit and debit card batches offer convenient refund processes. A merchant, for example, can easily pay back a client’s bill upon their request. However, it may take a while to receive the payment, and you must also consider the corresponding bank fees for bulk payment processing. Plus, with some people not having access to bank accounts and branches, credit and debit card payments are sometimes not recommended. But, worry not, there are many ways to make payments.

Third-party payment aggregation
There are third-party payment establishments that specialise in bulk payments and many other money and financial services. They work like banks but offer lower rates and allow customers access to financial services. Recipients will need to create a business account and sign in to receive the payments. The amount will be deposited into the recipient’s third-party aggregator account instead of a bank account.

With bulk payments, it is recommended that businesses use them for a few reasons and benefits. Let’s take a look at a few of those and how you can get the best out of them.

The most crucial factor in any payment gateway is security. Payment cardholder information will be kept secure and protected using a secure gateway. The Payment Card Industry Data Security Standard, or PCI DSS, compliance and consistent fraud protection are two ways payment gateways do this. 3D Secure offers a second level of cardholder authentication to online transactions. When a cardholder attempts to make an online payment and the bank detects a possible fraudulent activity, the card issuer may direct the cardholder to a 3DS page for additional verification.

Shopping cart integration
To ensure smooth payment processing, it’s crucial that your payment gateway integrates with your current shopping cart systems. There are many different online shopping cart platforms to pick from, and they all offer various features and tools based on your company’s requirements, from tools for developing stores to ones for processing payments and managing customers.

Multiple payment options
Online clients now have access to more payment choices than ever before. Because of this, it’s a good idea to provide your consumers with a variety of payment options, allowing them to select the one they are most familiar with and comfortable using.

Payment link
More recently, with a payment link, retailers can now accept payments even if they don’t have a website. Customers can use the link to make a payment on their bill. Without a card reader or website, the payment is then safely handled online.

Mobile payments
According to the PayFast Ecommerce Performance Index, mobile phones are the most popular device used for online purchasing, followed by desktops and tablets. This implies that the majority of your clients will probably transact utilising their phones. Your payment gateway must be simple to use on mobile devices as well.

Reports and analytics
A view of transactions and day-to-day management of inventory and sales are some of the data you can expect from payment gateway software. You should also be able to access a reconciliation report.

Connect with the connected
When it comes to bulk payments and other digital transactions needing to take place in this new normal, financial services providers are making it possible for businesses to transact through them. Offering a range of services and products, these financial services providers aim to give African businesses access to a bigger and broader market while also giving them the tools to handle all non-local payments without having to pay large amounts of bank charges. Through MFS Africa and the likes, many people are able to connect financially without having to worry about accessing bank accounts, especially in areas where it is a struggle to find bank branches.

Final thoughts
When it comes to managing your bulk payments, it is important to first identify your needs and have a clear understanding of how you’re going to use the payment method or solution.

Choose the one that will house all your transaction needs with charges that are in your affordability range to avoid having to use multiple outlets that will put you and your business at risk. You don’t always have to opt for service providers and banks with high bank charges, so enjoy transacting with ease.

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