Disadvantages of Electronic Payment Systems

Electronic money, also known as e-money, electronic cash, e-currency or digital cash, refers to money or scrip which is exchanged electronically. Basically, electronic payment systems are key enablers for mass acceptance of electronic commerce over insecure systems such as the Internet. In Business-to-Business (B-2-B) e-commerce, there is a rapidly growing interest in processing payments online.

However, these electronic payment systems have a number of a number of disadvantages also. You need to record to the establishment in order to be empowered to perform money transactions with them. Now, you need to have a username and password, and for that you need to have password aegis. Moreover, you also need to keep up an account per organization, which can be very irritating or pesky for you.

To make sure that your online transactions are solid, it is essential that you observe strict security policies. If password is capable of being hacked, it can mean serious fiscal loss for you. Banks or financial institutes that have your financial information can expose it to cyber-terrorist. So, there is unstated risk of your personal and account particulars being stolen.

The transfer of digital currency arouses questions such as how to impose taxes and the potential ease of money washing. There are also possible macroeconomic results such as exchange rate stabilities and shortage of money supplies.

Moreover, you are always at a loss if your card is stolen. If the card falls in wrong hands, there is a danger of expenditure of entire bank balance. You will obviously inform the concerned authorities about the loss but the time taken between losing the card and informing the authorities is critical.

The purpose of the above article is not to discourage people from making electronic payments but to make them aware of the inherent dangers that such payment systems involve.

Pros and Cons of an Electronic Payment System

During this highly technological age, cash is trying hard to compete with electronic money, since nowadays a lot of people choose to use their virtual wallets. Here, you will read about the pros and cons of using an electronic payment system.

It is plain to see that electronic payment systems have more advantages than traditional banking services. Let’s see:

  • Saves on time

Money transfer from one virtual account to another may only take a few minutes, whereas a wire or postal transfer may take a number of days. Besides, you have to spend some time to go to the bank or post office and wait in line.

  • Controls expenses

Even if a person is willing to control his disbursements, it can take a lot of patience to jot down all the expenses, and this takes up a huge part of the total amount. On the other hand, the virtual account comprises the history of all the transactions, including the store name and amount spent. Best of all, you can check it whenever and wherever you like. In this case, an electronic payment system works to your advantage.

  • Reduced loss and theft risks

You will not make the mistake of losing or leaving your virtual wallet behind, and it can never be taken by robbers.

  • User- friendly

All services aim to reach out to a greater number of audiences and so, their interface should be easy for users to understand. Moreover, users can always ask help from the support team since they work 24/7. You can receive an answer by means of the forums as well.

  • Convenient to use

As long as you have access to the Internet, you can carry out transfers anytime, anywhere.

After discussing the advantages that come with using an electronic payment system, it is essential to talk about its disadvantages as well:

  • Restrictions

In every payment system, there is a limit with regard to the number of transactions you can do per day and the maximum amount you can withdraw.

  • Risk of Getting Hacked

Risks can be reduced when you follow the security regulations. This is comparable to the risk of being robbed. The situation can get worse when the processing company’s system breaks down, since this may lead to the leaking of confidential information on the online cards, as well as its owners. Though some electronic payment systems do not launch plastic cards, they can however be involved in Identity theft scandals.

  • The problem of money transfer from one payment system to another

Most of the time, electronic payment systems do not cooperate with one another. If that is the case, you can use e-currency exchange services. However, it can consume a lot of time when you do not have a service you can trust for this purpose.

  • Lack of Anonymity

Since the database of the payment system stores all your transactions – like the name of recipient, amount and time – the intelligence agency can access all your information. Decide on whether that is good or bad.

  • The Need for Internet Access

When you have no Internet connection, you cannot transact on your online account.

Electronic Payment Now Offered By Self Storage Providers

Many self storage facilities are now adopting the electronic payment system for the convenience of their clients. With this option, it is easy for tenants to pay their monthly rent even while at home or in their office. It saves time and gas cost in going to the facility just to pay their due.

As with retail stores, the electronic payment option indeed proves advantageous to a lot of people particularly the busy professionals and business owners. By just going online and using their credit card, they can pay through the company’s website any time of the day or night they are available.

Experts are also encouraging providers that have established their websites to ensure that their sites are optimized for mobile devices. With the increasing number of people owning smartphones and tablets these days, it would benefit facilities to cater to this group as well. By making a website available in mobiles, customers can easily check for availability of units and search for other relevant information while on the move.

On the part of self storage facilities, they can also choose to use these mobile devices to accept payments whether onsite or remotely. The staff or the managers can utilize these modern technologies if they feel the need to do so.

Some managers also consider this a good option particularly for delinquent tenants who may be ashamed to show their face after a month or so of not paying their rent. At least through the online payment system, they can still makeup for their missed payments without having to see the reaction of the staff and the facility’s manager.

So what are the technologies that self storage can use to provide a convenient payment option to their tenants?

Website – Having a website is a big advantage. It not only provides customers with a way to gather information about your company and your services but it can also provide a payment option such as via credit card or PayPal. Make sure then that your website is fully functional to encourage clients and other internet users to visit it regularly when they have questions or if they want to pay their monthly rent.

Smartphone – Providers can allow customers via their smartphones as long as they make their website available on mobile devices. Many people prefer to use this today because they can do various tasks using this handheld device even when they’re out of the house or their office or while they’re traveling.

Tablet – Again, websites have to be made available on mobile to encourage self storage tenants to use electronic payment systems. This way, they can still pay their monthly rent even without visiting the facility at its location.

Although these facilities may have a local or regional wide customer base only, utilizing these modern payment technologies is still effective. Consumers normally go after convenience and when their self storage provider or any company for that matter is able to give this to them, you can be assured of their loyalty moving forward. And implementing an electronic payment system is definitely one way of providing this sought after convenience.