There are thousands of cryptocurrencies and tokens, each with its own structure, purpose and use case. There’s also one thing that popular crypto assets have in common - they can be used to pay for goods and services as long as businesses are willing to accept them. And, as time goes by, the number of such companies only continues to grow.
Why do businesses accept crypto payments?
As owning cryptocurrencies has become a norm for many people, it’s only natural that many look out for places that would accept their coins for payments. It has created a demand for crypto payment options, and by satisfying this demand, businesses attract more customers and gain a competitive edge over their competitors.
But high demand for crypto payment options is not the only reason why businesses accept cryptocurrency payments increasingly more often. Here are some other benefits of crypto payments that every eCommerce business can enjoy.
Accept payments from people with no bank account
One of the best aspects of cryptocurrencies is that a person doesn’t need a bank account to be able to use them. All it takes to make a cryptocurrency payment is a mobile wallet and an internet connection.
In less developed countries, especially in Africa, cryptocurrencies are already significantly more prevalent than credit cards. One and perhaps the only way for companies to reach these underserved markets is by accepting cryptocurrency payments.
Most commonly, the IT industry service providers (VPNs, web hosting) tend to serve the unbanked population in this particular way.
Sell your product or service internationally
Another massive benefit of cryptocurrency payment methods is the ability to instantly collect payments from anywhere in the world. It’s incredibly convenient for companies that do business internationally.
For example, if you’d want to pay from South America to your supplier in China, traditionally, it would take up to two weeks and go through multiple banks before the payment reaches the beneficiary. And numerous possible roadblocks can stagger the payment - banks might freeze or reverse the transaction, ask for additional documents (like a source of funds), etc., not to mention transaction fees that come with it.
None of that exists when paying with cryptocurrencies. A simple Bitcoin transfer would take 10 minutes or so, cost pennies compared to a traditional bank transfer, and could be done peer-to-peer, sometimes without involving any 3rd parties.
Pay lower fees for payment processing
It’s no secret that accepting credit card payments comes with great costs. Usually, a credit card payment processor will charge merchants a standard ~3% fee plus 30-50 cents for every incoming transaction. That’s why many merchants do not accept credit cards for small payments anymore.
Cryptocurrencies operate differently. The only fee merchants pay when receiving crypto payments is a payment processing fee of 1%, and that’s only if using a cryptocurrency payment processor with ready-to-use infrastructure, such as CoinGate.
Avoid fraudulent chargebacks
Sometimes customers want a refund, but, instead of contacting the merchant, a person calls his bank and asks to reverse the payment even if a service or product is already provided. Intentionally or not, that’s called a fraudulent chargeback.
Merchants usually dispute fraudulent chargebacks as doing nothing can result in hefty fines from the bank and lost profit from a sale. However, it’s a long and time-consuming process where the outcome often favors customers.
Besides, if a merchant receives an outstanding amount of chargebacks over time, a credit card processor might indefinitely stop the payment processing services.
Cryptocurrencies, on the other hand, help to avoid chargebacks entirely, as it’s impossible to reverse the payment that’s already been recorded on the blockchain.
Easy implementation and ‘hands-off’ approach
Many believe that setting up crypto payment methods is a daunting task and a process that has to be monitored full-time. However, specialized payment gateways can do the work for you with little-to-no effort on your side and even offer additional features that make the service that much more appealing, such as fiat currency payouts.
For example, the CoinGate payment gateway allows accepting +70 cryptocurrencies at once with a simple module. All the collected proceeds can then be converted to EUR/USD/GBP and sent to a bank account, allowing businesses to sell products and services for cryptocurrencies without ever dealing with them directly.
The official CoinGate module for PrestaShop users can be downloaded here.