The E-commerce world has a worldwide reach. Just like what SpottR offers, you can sell to anyone outside your location — which means far-reaching potentials for your business growth. Generally speaking, Ecommerce can expand your business across borders and emerging markets. This also entails that payment remittances and purchases will often require money exchanged across borders.
Cross-border payment is funds paid or taken in from different countries. The customer lives in another country away from the merchant. For you to successfully run a global business, it’s necessary to adopt a cross-border payment method. If you don’t, it means you would be missing out on sales that would negatively affect your bottom line.
With cross-border payments, you can take advantage of other marketing channels to boost your product sales. Anyone from anywhere can be an affiliate marketer for your product if you have the means to pay them.
Here is a list of ways to make cross-border payments.
Types of cross border payments
Credit card payments
Credit card companies issue credit cards and is convenient to use for online transactions. Credit card users can make purchases by borrowing money from the credit card issuer. To process a transaction, customers enter card details and wait for the transaction to be verified. This payment process involves the credit card company and the acquiring bank. Currency conversion occurs between these two parties. Parties have to work with exchange rates to determine the exact equivalent of money paid in both currencies involved. This additional task results in increased fees that are passed down the payment chain.
The Traditional method of international bank transfers still works. The customer makes transfers directly to the merchant’s account which is outside the customer’s country. The transfer sits in the merchant’s account. For instance, let’s say you have a dollar domiciliary account in Nigeria, and you send your account details to a customer. You will receive a credit alert in the currency that your account can take. Larger banks will have a limited range of currencies stocked and pay you in the currency of your dorm account which is the dollar in this case. However, bank transfers take days to reflect in your account after payment has been made.
An e-wallet is a digital wallet that allows customers to pay for online or in-store transactions.
You have it by downloading an app on your smartphone. Some wallets allow users to make transactions in several currencies. With an e-wallet, you can do a peer-to-peer or wallet-to-wallet transfer or payment. If the other person is located in another country, this can pass as a cross-border transaction. The other option is to withdraw from your wallet and transfer to a merchant’s account. Some e-wallets house fiat money while other e-wallets house cryptocurrencies. An example of the former includes Paypal and Apple pay.
SpottR provides a crypto wallet that houses its native cliq tokens to facilitate cross-border sales and payment in its marketplace. Merchants can withdraw their cliq tokens or make a wallet to wallet transfers to buy or pay for goods. A wallet with cliq tokens gives users trade credit and loan opportunities. Remittance through this method is cheaper than fiat channels. When buyers checkout using cliqtokens, they enjoy zero transaction fee.
Prepaid debit/cash cards
Debit cards allow customers to pay for goods using money they deposited in their bank accounts. Funds are automatically deducted from the customer’s account and transferred to the merchant’s account or debit card. Prepaid debit cards are processed over a card network, and payment is instant. If you are thinking of using affiliate means to help increase e-commerce sales, prepaid debit card payments have proven to be an efficient means to pay international affiliates.
Some payment gateway can provide the crossborder payment infrastructure you need. These payment service providers (PSP) offer various regional payment options to your customers. A Merchant can accept payments from customers in the custome’s local currencies and still get settled in Merchant’s preferred currency. With a payment gateway, customers can pay with their debit or credit cards. The international payment gateway service will help you confirm a customer’s card details before processing transactions. Payoneer is an example of an international gateway that provides cross-border payments.
The world has long become a global village. Businesses must continue to adapt to meet digital advancement. SpottR can help you take advantage of borderless transactions and achieve the growth and visibility you need. Contact us today to learn more about our services.