According to Auto Finance News, MasterCard and General Motors are collaborating to offer car buyers digital payment options. Today’s society is shifting its business practices to leverage online and mobile portals as prime conduits for its financial transactions. Opening the auto loan industry to electronic payment technologies promises additional sources of revenue for the industry.
Payment Portals Offer Flexible Options
Instead of using a check or cash, many consumers complete financial transactions by accessing a “payment portal,” also known as a “payment gateway.” These digital sites make the connection between buyers and sellers through the internet and eliminate dated, paper-based transactions. Not only do payment gateways close deals at a much faster rate, but they also create a digital record of each transaction detail, ensuring that both the seller and the buyer can accurately track the interaction between them. For auto lenders, offering a variety of payment gateways to their prospective customers provides each customer the opportunity to make their purchase using the most convenient option for them.
Types of Gateways Available to the Auto Finance Industry
There are several types of payment gateways, so auto lenders can choose the option or options that best fit their business model. Each option offers a slightly different perspective of the process, but ultimately accomplish the same goal: closing the deal as quickly and easily as possible.
Direct Merchant Page
This option requires the seller to establish a payment gateway on their proprietary website. Many retailers choose this option because it is often the most favored choice of consumers. However, this option also requires the seller to maintain the payment page, which can become expensive in light of the constantly evolving demands of digital security practices. Consequently, only larger corporations that have the resources and client base to support this cost will use the direct payment page for their online sales.
Payment Gateway Intermediary
This type of gateway uses the services of a third-party service provider to complete the transaction on servers that are unrelated to that of the merchant or the consumer. The best-known company offering this service is perhaps PayPal, which collects data separately from both the buyer and the seller and then completes the transaction for a small fee. Neither the merchant nor the consumer has access to the data of the other.
Payment Management Service
This option embeds the service providers payment page onto that of the vendor, making its access seamless for the consumer. Like the intermediary, the management service assumes all the elements of the transaction, including the security requirements.
Best Practices for Accepting Online Payments
Regardless of which system the auto lender eventually adopts, there are recognized best practices in the online payment industry that should be followed:
Give Buyers Access to and Control Over Their Records
Many online gateways give consumers the power to review their buying history, make and change automatic payments and save payment information for future use.
Automate As Many Functions as Possible
Online payments also facilitate online collections, inventories, and other business elements. The data collected through the payment gateway should be automatically connected to every other business element affected by it.
Inform Customers of the Opportunity
Especially in the auto sales industry, consumers are not expecting to access an online payment option. Letting them know as early as possible reduces their concern about how they’re going to pay for their new ride.
Things to Avoid
Untrained personnel can present the biggest risk to online payment activity because their actions may allow intruders to enter the company’s database. Each worker needs training on securely using the gateway technology and must be required to use passwords and dual authentication processes before gaining access for themselves.
PaymentVision offers electronic payment solutions and top-notch customer support to its auto lending clients to ensure their payment gateways and work sites are secure and easy to use. Want to know more? Contact us for a demonstration today!