Recent studies showcase that most online platforms suffer from over 70% cart abandonment rates. Out of this high number, a total percentage of around 50% people left due to complaining about the checkout process. Either it was too slow, too long, or not trustworthy enough. If you are a business owner, having an e-commerce platform is a must for a successful business. An ineffective checkout process can really hamper your sales. This is where modern innovations like a payment vault come as your trusted sidekick.
A payment vault ensures fraud protection and smoothens the slow checkout process with a few clicks. On top of that, this innovative online payment system offers a wide range of benefits for digital businesses. In this article, we will go through these advantages and offer you insight into why this can be a game-changing step for your business.
Understanding a Payment Vault And Its Key Features
A payment vault, also known as a token vault, is an encrypted storage solution for debit cards, credit cards, and other online transactions. Once you type in your card details, it stores your data for future use through tokenisation. This process is done by replacing your actual information, such as Personal Account Number (PAN), with a random token.
- These tokens can be used for multi-platform payments without re-entering your information every time.
- A payment vault is used for recurring payments or subscription models.
- It is also a key step in one-click payment models for a seamless checkout every time.
Just like a bank keeps your hard-earned cash safe from theft, a payment vault stores all your sensitive information from fraud. They are the future of digital payments and a blessing for small businesses losing out on regular customers due to failed transactions.
7 Advantages of Using a Payment Vault For Digital Businesses
Implementing an effective payment system is the need of the hour for every business. Here are some major benefits both customers and owners can enjoy:
1. Advanced Security and Fraud Protection
The process of tokenisation helps store customers’ transaction and card information in a separate token. This token is completely independent of the merchant’s data server, which drastically reduces the chances of a data breach.
- The token is named using a randomly generated series of characters, independent of the information stored.
- Even if the fraudsters get hold of the token, they can not access the information outside the encrypted space.
2. Faster and Smoother Checkouts
No longer do your customers have to wait for a long time while checking out. With saved information and multi-platform access through a token, they can enjoy faster checkouts in just one click. This is ideal for various applications:
- It reduces the need to remember CVV or CVC numbers that can cause false failures.
- For regular payments of the subscription platform, such as streaming sites, this reduces the manual typing requirements.
3. Flexible Payment Modes
With several options at your fingertips, such as cards, wallets, one-click payments, and in-app purchases, you can enjoy freedom of choice. You can choose the ideal payment mode as per your convenience and reduce failures.
You can also access it through mobile phones, laptops, and tablets without any hassle. This reduces the burden of designing your optimised payment system for different devices.
| Fun Fact: Mobile cart abandonment rate is the highest of all the devices at a massive 85.65%. |
4. Customer Loyalty and Trust
A well-structured and safe tokenisation system builds trust among your users. Regular successful payments and multiple payment modes allow you to build a loyal customer base for your business. This will improve overall customer experience and satisfaction, resulting in higher sales and sign-ups.
5. Easy Refunds
Whether you run a small e-commerce site or a food joint, refunds and chargebacks are an everyday reality. With a secure and fast encryption system, you can access the original payment route without exposing the raw and sensitive data. This also helps reduce the administration hurdles and improve the user experience.
6. Future and Scale-Proof
Payment vaults and digital payments are the future of online businesses. Implementing them early will give you a head start and a competitive advantage in the market. On top of that, the tokenisation encryption allows you to scale your business without any major investment in this area:
- It stores millions of customer data without any burden on the merchant’s server.
- It allows global payments from smaller cities to metropolitan areas. It also supports multiple currencies.
7. Reduced Operational Costs
Operating a payment vault comes at an administrative fee or charge. However, it is far lower than investing in a traditional and private security system. Plus, it comes with extra risks and maintenance costs that can build up over time.
On the other hand, you will have to incur additional customer care costs regarding failed transactions and other payment issues.
Wrapping Up
Payment vaults are the future of digital payment security and are here to revolutionise the e-commerce industry. Small or big businesses all over the world are adopting this advanced system for seamless transactions and reduced cart abandonment rates. The encrypted tokenisation system takes away the burden of PCI compliance and administrative duties from your shoulders. Now, you can keep your undivided focus on your business and website rather than worrying about failed payments.