Omnichannel Payment Reconciliation for Your Business

Omnichannel Payment Reconciliation is critical when the ‘savvy consumers’ demand a more effortless shopping experience. Retailers accepting single payment channels must rethink their internal sales process and payment support infrastructure to sustain their business. If a retailer wishes to be ahead of the competition curve to expand its customer base and gain loyalty. In that case, the facilitation and synchronization of payment data across multiple sales channels need to get integrated into the system. The end goal is to provide consumers with a single shopping and payment experience across all sales channels.

Customers commonly shift between online and offline business interactions, with 48% transitioning between digital and physical. Omnichannel payments include selecting online and in-person options to meet customers where they are, seamlessly providing them with important purchase information.

According to the Harvard Business Review, 73% of all customers use multiple channels during their purchase journey. Besides, the State of Commerce Experience 2021 reports that almost half (44%) of B2C buyers and 58% of B2B buyers say they always or often research a product online before going to a physical store.

This blog focuses on the vital factor that omnichannel payment reconciliation is necessary and mandatory for all retail businesses today, post the pandemic.

Types Of Omnichannel Payment Processing

Omnichannel payment processing includes multiple payment methods for both online and offline transactions. Here are some of the primary channels that are commonly used in an omnichannel payment platform:

Digital Payment

The ‘Digital India’ campaign by the Government of India promoted and encouraged the use of digital payments. To create a ‘digitally empowered’ economy that is ‘Faceless, Paperless, Cashless’, businesses started adopting various types and modes of digital payments. These include: –

Internet banking
Mobile wallets
Digital payment apps
Unified Payments Interface (UPI) service
Unstructured Supplementary Service Data (USSD)
Bank prepaid cards
Mobile banking

Digital payment methods offer ease, flexibility, and convenience to consumers to make payments from anywhere and at any time. These options are an excellent alternative to traditional payment methods and faster transaction cycles.

Physical (in-stores)

In-store payment methods mainly include cash and credit card payments from customers. But if these are the only payment options available, it would put off potential and existing customers. By understanding the benefits of the multiple payment options, retailers can decide what works best for their stores and customers. Let’s review the types of payment options:

Debit/Credit Cards
Cash
Cheques
Mobile payments
Gift cards and store credit
Home Delivery

For most customers, pay on delivery is the ultimate satisfaction. Pay on Delivery is consumers’ most widely used option, especially in Tier II and III cities. Listed below are payment options that consumers can opt for payment on delivery:

Cash on Delivery
UPI
SMS pay link – provided by the retailer
credit card/debit card
e-wallets
prepaid cards

Challenges And Solutions

The growing number of online buyers has increased orders and thus increased transactions. As a merchant’s payment processing requirements evolved, they adapt to separate sales channel support tiers. For example, telephone or online payment methods are used to keep up with consumer demand for shopping or payment facilitation. However, more transactions led to more complexities which invited more money leakages in the process. As a result, it makes you lose money, even in profits. Therefore, it is essential to reconcile the entire payment transaction to eliminate these losses.

While the retailer adapts to this omnichannel environment, it is evident to face many challenges in managing multi-transactions perfectly without having consumers drop out. Some challenges are listed below:

no single view is available of the customer’s interactions across different channels across business units regardless of the function. Multiple times payments and deductions against a single order due to various formats for various marketplaces.
Arrangements with payment service providers (PSPs) and acquirers focused exclusively on online and other payment options for in‑store payments. This results in complicated marketplace reports & uninformed deductions, causing tiresome calculations on multiple costs under sales & returns.
An organizational structure focused on each channel where marketing or technical support teams focus exclusively on the eCommerce channel, and another team focuses on retail sales. Unfortunately, it results in unmanageable follow-ups with the eCommerce seller support team and missing out on the claims window.
The eCommerce stock is segregated from the offline store’s inventory, where the online orders are fulfilled from the eCommerce stock only. This process can generate unnecessary delays in fulfilling online orders, and technical glitches in processes will void consumers from returning purchases.
Securing transactions: Point-of-sale and legacy devices or equipment that does not use encryption or tokenization when accepting consumer credit card data or POS applications that allow cardholder data entry directly causes transaction failure. Again, this creates financial risk for the business with the ongoing burden of securing cardholder data.

Henceforth, the solution can be identified by having the IT infrastructure manage multi-transaction windows in a single frame. A few of them are listed below:

Scalability

If you’re investing in an omnichannel solution, it’s essential to look at your current and future needs. The option you choose should support your current needs and goals, but beyond that, the solution should be capable of growing with you. Ensure that your chosen omnichannel solution can help your business as it scales with increasingly robust products and solutions.

In-house development

Any omnichannel payment processing provider you choose, it should have an in-house development team. Providers with in-house development teams are committed to innovation. They envision and create new payment methods and channels. It indicates that the omnichannel strategy continually expands and meets customers’ growing needs and expectations.

Payment collection tools

In addition to the standard payment channels, look for an omnichannel provider that offers payment collection tools like email pay and a customer payment portal. These tools provide simple, convenient online payment methods that are especially helpful for B2B customers. These additional payment tools increase your customers’ payment options and make it easier for you to get paid.

Collection tools increase customers’ payment options without adding extra work for you. For example, email payments and customer payment portals automate much of the payment process and automatically sync back to your accounting software, so there’s no manual work to reconcile payments.

Support

Finally, it’s crucial to have excellent support. When managing multiple sales and payment channels, you need a responsive, helpful support team to help identify and solve problems. Fortunately, one of the main benefits of omnichannel is that you have a single support team to contact, rather than a different one for each payment provider.

Security

Security is imperative when it comes to payments. Businesses are responsible for protecting their customers’ sensitive information. In addition, security creates a strong customer relationship built on trust.

Because omnichannel systems cover many payment methods and involve many moving parts, each transaction must be secure. Look for a provider that uses tokenization and encryption to protect data at rest and in transit. In addition, the solution should be fully PCI compliant and store all credit card information off-site.

Benefits

Consolidation of payment processing technology and banking across the omnichannel payment environment
Reduced environment complexity – Reduced IT infrastructure costs and ongoing maintenance/development costs.
Lowered security risks – Omnichannel cross-tokenization and encryption for payment data protection, minimizing the burden of securing business IT systems
No Data Breaches- All credit card data is removed from back-end systems, which reduces financial risks associated with data breaches.
No Additional Associated Cost-Vendor consolidation results in reduced payment processing costs, improved customer service, and standardization of solution functionality across multiple IT systems.
Seamless payment processing across multiple payment channels
Unified transaction reporting across all payment channels
Single end-to-end payment processing solution with unified consumer shopping and payment experience across all channels
Mobile payments available across all channels
Improved customer engagement and loyalty with improved customer shopping and payment experience
The entire omnichannel payment environment is entirely integrated end to end.
Reduced transaction processing time
Lower interchange transaction fees

Conclusion

Hence, it is best to go for omnichannel payment reconciliation instead of staying multichannel and keep innovating with changing market needs. Adopting omnichannel payment processing within a business will help increase sales and reduce data security risks. It will also accelerate the customer payment checkout experience, facilitate customer data sharing across all sales channels, and foster customer growth and loyalty. In addition, a robust omnichannel process will further reduce operational costs across many business areas, help gain a competitive advantage, and improve credit card data security.

Omnichannel payment reconciliation gives businesses an all-in-one, comprehensive payment processing solution. You get an advantage of a bird’s-eye view of customer interactions and dedicate marketing efforts to enhancing consumer’s purchase experience. Besides this, you check some of the best payment reconciliation practices here.