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5 payment trends to keep an eye on in 2022

If you want to begin the year on the right foot, here are five payment trends to watch and consider adopting in your business.

5 payment trends to keep an eye on in 2022

After a rocky couple of years, things are finally starting to pick up for Aussie businesses.

With the doors open again and seven in 10 SMBs saying they expect an increase in sales within the next 12 months, business in 2022 is looking brighter than it has in a while. But that’s not to say we’re going to go back to pre-COVID times — in fact, far from it.

Like the two years before it, 2022 is going to require SMBs to adapt to a new playing field. The way customers behave, shop, and pay for goods and services has completely changed in the past two years. Couple that with the run-on effects of dipping into savings and accessing government support to keep everything afloat during the pandemic, and 2022 will be a challenge for companies that want to keep up and scale up in the future.

As business begins to rebuild, keeping on top of your cash flow, and ensuring it grows, is now more important than ever. If you want to begin the year on the right foot, here are five payment trends to watch and consider adopting in your business.

1. Building a payments strategy

With everything else going on, it can be surprisingly easy to forget about how you’ll accept payments from customers and the options you give them to pay.

COVID-19 spurred a massive boost in online activity as consumers were forced to do everything virtually, from booking appointments to running meetings, seeing the doctor, or arranging maintenance jobs around the home. Unsurprisingly, alongside these trends, there’s been a growing demand for the use of fast, data-rich electronic payment methods, like those offered by the New Payments Platform (NPP), and a significant dip in the use of paper-based methods like cash and cheques.

The retail sector has been leading the charge in fast digital transactions with its uptake of the NPP, and it’s only a matter of time before this trend makes its way to other industries.

With 2 in 3 Aussies working at home or in other remote locations, the need for seamless and convenient online payments is growing — and the local businesses and service providers that are up to speed with digital payments will be the ones that win in 2022.

The takeaway: Making it easy for clients and customers to pay how they want to pay needs to be a consideration for all businesses in 2022. Whether it’s the NPP, QR codes, mobile wallets, PayPal, e-invoicing, or debit and credit card, every business needs to have a payment game plan that’s convenient, digital, and versatile for customers.

2. Embracing automation and integration

If you’ve felt like you’ve been wearing multiple hats in 2021, you’re not alone. SMBs are notoriously time-poor, and staff shortages from COVID-19 have only added fuel to the fire. From growing the business and finding new clients to spending hours on invoicing and chasing up payments, it’s no wonder that business owners feel like the mountain of work never gets done.

Thankfully, technology has never been as sophisticated as it is now — and if you use it well, this can shave countless hours (and headaches) off your work week. Time-consuming processes like balancing the books and chasing overdue accounts can all be automated with tools like Pinch, so you spend less time on financial admin.

What’s more, you can take it one step further and adopt integrations across as much of your workflow as possible, such as linking your accounting, payments, and CRM platforms to create a single customer view. On top of saving time, you’ll have a 360-degree view of your customers, including every interaction, payment, or action they’ve taken — allowing you to create relevant and targeted strategies to grow your business.

The takeaway: Automate and integrate your payment, accounting and CRM platforms as soon as possible. You’ll save time, money AND streamline processes — a hat-trick for any SMB looking to get ahead in 2022.

3. Flexible solutions that adapt with your business

Every business under the sun has been forced to adapt in recent years. And while we’re all a bit tired of hearing the word ‘pivot’, this concept needs to be embedded in your business in 2022.

No matter what industry or position you’re in, responding quickly to external forces is key. How SMBs do business will continue to evolve in the year ahead and existing clients may require more flexibility in their payments as they grapple with the ongoing effects of COVID-19 on their business. Having a payment platform that lets you easily adapt your invoicing and payment collection  is crucial to ongoing success.

The takeaway: Business is more flexible now, so your payment processes should be as well. Look for a payment platform that supports multiple payment methods from one invoice, and that offers the ability to break up larger invoices into payments or instalments.

4. e-invoicing as the standard

In 2022, traditional invoicing just doesn’t cut it anymore. Between creating invoices, manually chasing late payments and correcting errors, paper-based invoicing costs the average business a full month’s worth of work every year. But there’s an emerging technology that’s promising to completely turn the invoicing process on its head for the better: e-invoicing.

E-invoicing allows businesses to send and receive invoices directly between their accounting systems without needing to manually input any data. The business issuing the invoice simply sends it via their accounting software, such as Xero, then the receiver gets the invoice directly in their accounting software as a draft bill that’s waiting to be approved.

All of this translates to faster payment times, fewer accounting errors, and more time for businesses to spend on other tasks.

The takeaway: Register for e-invoicing in 2022. This one-time registration only takes a few minutes and can be done directly in your accounting software — then you’re good to go!

5.  Improved security for B2B payments

With more businesses paying suppliers and service providers online, payment security needs to be a priority for all SMBs in 2022. Payment redirection scams cost Aussie businesses a whopping $128 million in 2020 — and the majority of these reports were from small and micro-businesses.

The tricky part with scams and frauds is that they’re constantly evolving their practices, which makes it nearly impossible to keep up. One of the most effective ways to minimise these risks for your and your customers is to implement payment automation and e-invoicing.

With invoices exchanged over a secure network and little human interaction, you’ll reduce the risk of interception and fraud. At the same time, you won’t have to worry about asking customers for their credit card details over the phone or email, and how to store credit card details for later payments.

It’s also worth educating yourself and your team on best practices for paying online, such as only paying on websites that have a current security certificate installed, checking the source of any email requesting payment, checking the link on an email before clicking on it, and confirming that a website is genuine before making any kind of payment.

The takeaway: Payment security needs to be at the top of your to-do list in 2022. By automating invoicing and payments and integrating them with your existing software, you’ll reduce the likelihood of falling victim to any scams in the future.

Over to you

For the well-prepared, 2022 promises to be a year packed with opportunities to work better and grow smarter. By adopting the latest payment trends for your business, such as automation and integration, you’ll have more time to spend on the things that make you money — and deliver a better customer experience to boot.

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Posted by Paul Allen on 20 January 2022