The key to your notoriety and repeat purchase. The main models of payment solutions: traditional solutions with VAD and others The-steps-of-an-online-payment (2) The stages of an online payment – View by the buyer Solutions with VAD: often more expensive and less functionally rich Historically, when you wanted to open an e-commerce site with online payment, you had to contact your bank, which then (often laboriously) opened an account for you with VAD ( Distance Selling ).

With a VAD, the bank Denmark Phone Number List you with a virtual sales terminal: it is your payment intermediary between your online store and your customer. Each bank offers its solution, with a specific API, which must be integrated into your online store. The e-commerce solutions on the market all offer already existing modules for the main VAD solutions of banks. The difficulty, in this case, when you are a new business, is to be able to negotiate attractive rates.

Indeed, as a financial intermediary, the bank must be able to secure transactions, and, if you have no financial history, the rates that the bank can offer you may be prohibitive. In addition, banks are not historically the most innovative and efficient in terms of service and user experience (although this is changing quickly!) . The interfaces offered are often austere, with limited customization capabilities. For a user used to paying with a click on Amazon, the feeling of the customer experience is not always optimal.

Ends Up Offering A Bad Customer Experience

Alternative online payment solutions: a market explosion! The online payment sector has been booming for a few years and payment startups have thus raised $ 22 billion in risk capital since 2019! This market is full of startups with particularly heterogeneous services and business models . The envisaged market potential is 2,000 billion dollars by 2026! or a doubling of the volume in 10 years.

The operating principle is simple: these companies (called Fintech) position themselves between the bank and the merchant. When a customer makes a payment on an e-commerce site , he performs the transaction on the device of the third-party solution, which, in real time, requests authorization from the customer’s bank.


If the transaction is authorized by the customer’s bank, the transaction is validated and the merchant’s bank is credited. The advantage of these solutions lies in the many services offered , both for e-merchants and for customers. Here are some examples of services offered:

Payment in installments, Registration of bank cards, By subscription, Electronic wallets, Direct debits and bank transfers, Authenticated bank direct debits, Buy now, pay later, Gift Certificates. A PSP is not just used for payment by credit card It is already important to indicate that payment by credit card, even if it dominates in France, is not the only alternative to offer on your e-commerce site .

It Is Therefore Necessary To Be Able To Make

Its popularity is explained by its efficiency for the Internet user, and also because of the associated low risk of fraud . This type of payment requires compliance with the PCI – DSS standard to allow the processing and storage of credit card data. Alongside these card payment practices , now well established in France, can coexist: Purchase on account  :

This is, for example, a very popular means of payment in Germany. No sensitive payment data is communicated by the customer and the product is shipped immediately after ordering. Then the invoice is paid by the customer after receipt of the product . The risk, in this case, is to have a high number of delinquencies and significant collection charges. The PSP is an important player here because it takes care of the entire invoicing and payment process and the risk of unpaid invoices.

The E-merchant pays the PSP a small fee for each transaction in order to take advantage of this service. Payment by direct debit  : The customer chooses to pay via the direct debit process and enters their direct debit information in an ad hoc form. A direct debit authorization is then executed and, if successful, the retailer immediately withdraws the money from the customer’s account and then ships the order.. The process is fast and cost effective.

This system is not widely used in France, but much more in Germany. The possibility of unpaid invoices is much lower when using direct debit compared to purchasing on account. However, if the customer disputes the charge, enters false information, or there is not enough money in the account to complete the purchase, a refund fee will arise.

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