Is Cash Still King?
Let’s be clear on the definition of cash as it is used in this article. Cash means hard currency, actual money. It does not mean money sitting in your bank account. When a customer walks into a retail shop they will pay for their purchases at a Point of Sale (POS) either with actual cash, or with some sort of debit card or credit card, or maybe by scanning a code using their mobile phone). There are even digital currencies (cryptocurrency) such as Bitcoin that are becoming more recognised.
Consumers are moving away from the use of cash in recent years, instances of payment via bank cards have slowly been increasing, with both debit and credit cards being used regularly. For a customer, not only does transacting in ‘plastic’ lighten the wallet, but it is also far easier and more secure than carrying cash around on their person.
It is expected that soon, the world will be cashless, with all transactions either being processed online or by card. The race for a cashless country is currently on with Sweden in the lead with only 15% of transactions involving cold, hard cash. Having said this, cashless countries are not only limited to developed countries, but cash is also even threatening to become extinct in countries like Somaliland and India.
Card Payment Benefits
Due to the demand by consumers more and more businesses now offer some type of cashless payment option.
The more payment options a business can offer a customer, the more chance that the customer will purchase. Many consumers do not carry much cash and would be more likely to an alternative vendor that accepts credit card transactions than they are to find an ATM to draw the cash and return. Offering a wide range of payment options also encourages impulse buying. It never feels too expensive when you just hand over your card.
Businesses are also less at risk when they are not having to deal with large amounts of cash, which needs to be counted, locked away, and then taken to a bank to deposit. Adding to this hassle and expense are the charges that banks levy on handling cash.
For a business, this results in a speedier service and creating a safer environment for the consumer.
Card Payment Challenges
Once a business has signed up as a vendor and obtained a credit card machine, then the headache of how to control this payment method using their current Point of Sale (POS) System begins. Once all the purchases are entered into the POS System and a total amount payable to given to the customer, the POS teller will obtain the customer’s card and enter this total amount into the Credit Card machine. Once the customer has entered their PIN number, the machine will connect and try to authorise the transaction. Only once the payment has been authorised, should a Tax Invoice be generated by the POS System, this must be manually done by the POS teller. This process can be quite time consuming, which is not ideal in a busy retail environment. Long queues are not a way of attracting customers to your store.
Another problem is the amount of manual intervention in the process also means there is room for fraud as well as error. There is no guarantee the teller will key in the correct amount into the card machine, for example.
Another headache is the manual reconciliation at the end of each trading day of all the different credit card payments, which will not necessarily be deposited in your bank account in one lump sum.
The Solution – An Integrated Card Payment System
An integrated Card Payment solution is one in which the Point of Sale (POS) software, communicates directly to the Card Machine. This means that once the purchases are all entered into the POS system and the customer indicates they wish to pay by card, the POS System will send the amount required directly to the Card Machine. The customer then just enters their PIN number and the Card Machine then requests authorisation. Once the authorisation is obtained the control is passed back to the POS System and a Tax invoice is printed. If authorisation is not obtained, then the sale will be incomplete and no invoice will be printed. The teller must either obtain another form of payment or void the sale.
Furthermore, at the end of each trading day, and in many cases during the day as well, reconciliations of the various card payments grouped by card type are available online making reconciliations easy and efficient.
Vexen Technologies is a South African based broad spectrum Information Technology services company that makes it easy for you to boost your business potential through the power of technology. Vexen Technologies specialises in 3rd party integrations with credit card providers, and they have designed solutions that allow Enterprise Resource Planning (ERP) Vendors to integrate directly with a credit card machine. Presently working with ABSA, Standard Bank, and Nedbank; there is no restriction on the type of card that Vexen Technologies is able to work with. With Vexen Technologies, you will find that there is never a reason to turn a customer away. With their revolutionary credit and debit card processing service, you can accept Master Card, Visa, Maestro, Visa Electron, Diners, American Express, and many more. Their highly skilled team of Information Technology and Point of Sale Specialists will assist you in securing turn-key solutions that suit your specific business needs and budget.
Omni Accounts with its powerful Enterprise Resource Planning software has partnered with Vexen Technologies, and together they have developed a fully integrated solution that integrates Omni Accounts’ powerful Enterprise Resource (ERP) software with credit card devices. Omni Accounts Enterprise Resource software also offers a fully integrated Point of Sale system which is capable of handling multiple users. This combination offers a combination that gives efficient and more secure day-to-day running of Point Of Sale retail environment and which also integrates real-time into the full Omni Accounts Enterprise Resource System.