With the advancement in technology, we have moved forward in the modes of payment as well. From the ancient metallic coins to paper notes followed by plastic currencies like credit and debit cards and mobile wallets. In the past couple of years, cryptocurrency has captured the attention of many for being the future of digital payments.
Cryptocurrency is a digital or virtual currency without the involvement of any centralized regulating authority. The acceptance of cryptocurrency is still at the infancy stage. Businesses across the globe are slowly but surely accepting cryptocurrency as a mode of payment.
Most of the companies have already started accepting bitcoin payments. Bitcoins are the most popular and largest form of cryptocurrency known in today’s world. In addition to these big names, some small businesses like cafes, coffee shops, and restaurants have also started accepting cryptocurrency as a mode of payment.
Cryptocurrencies have the capability to provide unmatched benefits to both customers and merchants. They are here to stay for a long time. It is the responsibility of business owners and entrepreneurs to accept novel modes of payment such as bitcoins. This is not only beneficial to them but their customers and clients as well.
Let us know some interesting statistics about cryptocurrencies.
● The market capitalization of bitcoins currently stands at 169.44 billion USD. (Statista)
● The overall cryptocurrency market is estimated to reach 1.40 billion USD by 2024, at a CAGR of 6.18%. (Markets and Markets Analysis)
● There are about 3.5 lakh Bitcoin transactions taking place in a single day around the world. (SmartBit, Australia)
● By the end of December 2019, there were over 44 million active crypto wallet users across the world. (Statista)
Benefits of accepting cryptocurrency for businesses
There are myriad benefits of accepting cryptocurrency and bitcoins for businesses as well as customers. Some of these are:
1) Putting an end to chargeback frauds
Most businesses and enterprises tend to lose a lot of money due to the chargeback scams done by customers. It involves making fraudulent complaints against the business to the card company, using which users get to use the products and services for free. Businesses finally give in and pay the money back to the customers.
By accepting cryptocurrency, businesses can put an end to potential fraudulent chargebacks. Any cryptocurrency transaction that takes place through a crypto payment gateway is immutable and cannot be altered. Once the customer has paid the business for a product or service, the money is directly credited to the crypto wallet of the business. Unlike credit card payment, the charges in case of cryptocurrency cannot be reversed.
2) Lower transaction charges
While accepting traditional payments like credit card and debit card, businesses are levied a transaction fee of nearly 2-3 percent plus several other hidden charges. This is not the case with cryptocurrencies like bitcoins. The per transaction fee for accepting cryptocurrency is a minimal flat fee and not a percentage. A crypto payment gateway usually charges about 0.5 % to 1% per transaction, which is hardly anything when compared to the traditional payment systems.
3) Third-party involvement
Traditional payment modes involve a third-party. Whenever a customer makes a payment, it is credited to the bank account. The bank is in control of the funds. The bank has the authority to freeze an account if customers do not comply with certain guidelines and procedures. This also implies when businesses are accepting cryptocurrency.
When businesses accept bitcoin payments, there should be third-party involvement. The amount is directly credited to the crypto payment wallet via the crypto payment gateway. Once the funds are in the wallet, only businesses have complete and secure access to it. The transactions that happen once can be reversed.
4) Faster access to money
Since payments made by credit or debit card involves a third-party, there is a waiting period for businesses. They can only see the amount reflecting on their bank account once the waiting period is over. This period may be anywhere between a few days to nearly a week.
Cryptocurrencies empower businesses to send and receive payments anywhere across the world. Cryptocurrency transactions are completed within minutes, most importantly there is no need for an ID or bank account number. Once the transaction is completed, the funds are available for immediate use.
Cryptocurrencies are recognized all over the world. Enterprises can convert them into the local fiat currency. It is essential for businesses to deal with international clients to accept bitcoin payments. This is a big advantage for businesses accepting cryptocurrency. They get instant access to the funds and can make use of it for their business.
5) Eliminating the security issues
Cryptocurrencies like Bitcoins are based on blockchain technology. Blockchain is a decentralized, electronic ledger which cannot be altered or modified by anyone. The cryptocurrency transactions are permanent, irreversible and cannot be tampered. This eliminates the chances of any counterfeit activity by hackers and cybercriminals.
6) Making foreign payments easier
Most businesses are susceptible and vulnerable to going global. The reason behind this is that there is a large amount charged as currency exchange and international transaction fees. This can turn out to be extremely detrimental for companies, taking a hit at their profits.
Accepting bitcoin payments eliminates this problem. This is because bitcoins are recognized and accepted across the globe. Accepting cryptocurrency makes it easier for businesses to expand and access new opportunities across borders. This makes crypto payments truly borderless in real sense.
7) Protection of sensitive information
The major issue with banks is that they ask and retain a lot of information. For example, our name, location, contact number, credit history, and much more. They keep a track of where someone is spending money or where the money is invested.
In the case of accepting cryptocurrency, there is no need to disclose any financial or other private information. Crypto Payments are only restricted to the transaction ID and the crypto wallet address. This helps in maintaining a higher level of privacy. This ensures that both businesses and users are protected from fraud.
If businesses are looking forward to embracing cryptocurrency, they need to do so using payment software. This software is capable of accepting cryptocurrency seamlessly and securely. It processes all the transactions with the help of a crypto payment gateway. An example of this is CheckYa software. It enables businesses to accept bitcoin payments using coinbase, a crypto payment gateway.
Cryptocurrency offers numerous benefits to businesses and customers. Considering this, it would be a wise choice for enterprises to start accepting cryptocurrency. This would help to surge ahead of the competition in today’s world.