Open banking is a revolutionary concept that has transformed a number of sectors in the UK. It involves the use of open APIs to allow third-party developers to build applications and services on top of banking infrastructure. One of the most significant benefits of open banking is the ability to make payments directly from bank accounts, without the need for intermediaries like credit card schemes. This offers a range of benefits to businesses, particularly those in certain industries that can benefit from low fees, instant settlement of funds, speed, security, and the elimination of chargebacks.
An industry that is significantly benefiting from open banking payments is the e-commerce sector. Online shopping has become increasingly popular over the past few years, and businesses in this sector are facing significant challenges in managing payments. The use of open banking helps to reduce transaction costs and eliminate the need for intermediaries, leading to lower fees and faster settlement of funds. The elimination of chargebacks and the reduction in fraud risk, makes online shopping more secure and reliable for both consumers and businesses. To see how we sit on the checkout of ecommerce retailers you can view us on a number of sites including Lusso Footwear.
Another industry that is benefiting from open banking payments is the travel industry. Travel businesses such as airlines, hotels, and travel agents often deal with high volumes of international transactions, making it challenging to manage payments and settle funds quickly. The use of open banking enables these businesses to reduce transaction costs and eliminate the need for intermediaries, leading to faster and more reliable settlement of funds. Additionally, the elimination of chargebacks is a huge asset in the travel industry which has faced high levels of fraud in the past.
The gig economy is another sector that benefits significantly from open banking payments. Freelancers, contractors, and other workers in this sector often rely on fast and reliable payment methods to manage their cash flow. The use of open banking allows these workers to receive payments instantly, without the need for intermediaries or delays in processing. This helps to reduce transaction costs, improve cash flow, and eliminate the risk of chargebacks. See what we are doing here with The Bodhi Club to enable them to reduce their payment fees. With the Boodil pay by portal solution, any small business or sole trader can put in the amount / reference and send their customers a link to pay via Boodil's slick and seamless pay by bank solution and receive funds in their account immediately.
The automotive industry is another industry that can benefit from the use of open banking payments with the ability to send out pay by links, which offer an open banking payment solution. As a sector that deals with high-value transactions, when customers purchase vehicles, they typically make large payments that can be subject to high transaction fees if processed through traditional payment methods such as credit cards. Open banking payments, on the other hand, offer low transaction fees, making them an attractive option for businesses in the automotive industry. The transaction is processed instantly, allowing the business to receive funds quickly. Additionally, open banking payments are highly secure, reducing the risk of fraudulent transactions.
Finally, open banking payments offer the advantage of eliminating chargebacks. Chargebacks can be a significant problem for businesses in the automotive industry, particularly when customers dispute transactions or claim that they did not receive the product or service they paid for. Open banking payments eliminate chargebacks, reducing the risk of fraud and disputes.
Overall, the benefits of open banking payments are clear, and businesses in a wide range of industries stand to benefit significantly from this technology. Whether it's e-commerce, travel, automotive or the gig economy, open banking offers a range of benefits, including low fees, instant settlement of funds, speed, security, and the elimination of chargebacks. As this technology continues to evolve, it's likely that more businesses will begin to embrace it, leading to greater efficiency and reliability in the payment processing industry. Along with all of these benefits if you decide to adopt Boodil's pay by bank solution at the checkout we reward customers with redeemable points every time they pay. These points can be utilised in our mobile application and encourages loyalty to the retailers and businesses we work with.
Not sure what other payment methods you should have on your checkout then check our blog on the "4 payment methods every checkout should have."