The days of carrying multiple credit cards in your wallet could be coming to an end.
Binji, a startup company from Irvine, CA, is developing an all-in-one debit card. The sell? You can combine all your debit and credit card funds onto a single card, then choose which card to pay with at checkout. For consumers, that’s convenience at its finest.
Why does Binji’s super debit card have a strong chance of making it to market? It’s simple: people buy into things that will make their life easier. So what does this mean for the payments industry and, in particular, your small business? Here are some of the potential effects this trend could have on small businesses across the country.
Your POS System Will Need to Evolve
This is nothing new. Businesses had to adapt when credit cards came into existence, and again when chips were added to certain cards. With a smart card like Binji, it’s likely your POS system will once again need tweaking – or even a complete overhaul.
Why? As credit card technology advances, so should your point-of-sale technology. If a customer gets to checkout but can’t pay because your system is outdated, then you’re losing their business. Once that technology catches on, you’ll have no choice but to update your own technology, most likely at a steeper price.
What can you do now? Keep tabs on the latest in credit card technology. Read articles and ask your payment processor if they’re updating their POS catalog to reflect any new trends. If they’re not ready for change, you won’t be either.
B2B Transactions Will Be…Different
We’ve talked about the advantages that customers will receive from consolidating their credit cards, but what about business owners? Would they benefit from this trend?
It’s hard to tell. On one hand, there’s convenience in aggregating multiple company credit/debit cards onto a single card. Businesses often switch between cards when purchasing different items/services, so it’d make sense to give merchants the option to switch between cards instantly. Plus, one card eliminates the need to carry multiple physical cards around, which mitigates the threat of having your funds stolen.
On the other hand, card not present transactions might become more difficult to complete. Mail order/telephone order transactions require you to collect the consumer’s credit card information, but if they don’t have that information handy it could slow down the transaction. This shouldn’t be too concerning if the Binji app stores detailed card information for you to reference.
Overall, credit card consolidation will likely affect the way you process B2B transactions…but whether the pros outweigh the cons remains to be seen.
Cash Transactions Will Be Even More Rare
That’s right. Right now, credit cards are already an appealing method of payment; you don’t have to carry wads of cash around, and most credit card companies offer rewards for using your card frequently.
With the consolidation of credit cards, more and more people will pay without cash (as has been happening in recent years). In turn, businesses will begin to adapt too. Stores that are currently “cash only” may eventually convert into ATM-friendly places of business.
More importantly, processing fees may actually decrease with the advent of an all-in-one debit card. Credit card companies and banks LOVE when customers pay with credit card because they can charge merchants for every credit card transaction processed. If the economy favors debit transactions, card companies might decrease their fees to convince business owners to encourage customers to pay with credit card. Still, this is only a guess; the payments landscape has always been – and will always be – unpredictable.
Quantum – Dynamic Solutions Today for Merchants Tomorrow
At Quantum Electronic Payments, we don’t just sit on our heels and wait for change to happen; we proactively anticipate change before it comes. Our suite of processing hardware, pricing programs, and merchant solutions keep us at the cutting edge of the industry. We’re constantly refining our offerings to reflect the payments industry climate and the trends that promulgate.
Ready to join the most forward-thinking processor out there? Let’s get talking. Click here for a no-cost, comprehensive merchant statement analysis, conducted by our in-house team of experts!