How to Use Data for Better Payments

Data helps you see, to know. You must know your customer to offer them the best. You have to be intuitive to delight customers and foster loyalty. The explosive growth of online shopping and digital payments is creating tons of data. Analyzing this data can give you rich insights that help you run your business better. New banking infrastructure coupled with new payment regulations are making it easier for brands to tap into data, which in turn, is fuelling innovation to build better payments.
As a merchant in Europe, knowing how data is changing the way consumers and brands interact helps you to use data in smart ways.

How does data help your payments?

Data improves payments in many ways – from helping you fight fraud to making payments more seamless. The more data you have, the better the insights you can draw from it. Here are four ways in which data helps your payments:

1. Better fraud prevention
Having access to payment and transaction data helps you understand your customers’ buying behaviour – how they shop and pay. You can analyze this data in real-time with AI-based tools that use machine learning to sift through huge amounts of data and draw meaningful insights. This helps you to map out patterns of behaviour and report any suspicious behaviour. Hence, you can take timely action to prevent fraud and data breaches.
AI-based anti-fraud engines work better when they have more data. Hence, you can collect and analyze data from across all company functions, such as CRM, sales, or customer support. Based on the data you can set up anti-fraud rule sets to block out suspicious transactions. You can also make necessary tweaks in your risk management setup if required, based on what the data is telling you.

2. Better personalization
Data helps you design tailored offerings and personalization – in short, a better UX. It helps you understand what makes your customers tick, their likes and dislikes. You can offer more seamless payments and faster checkouts based on what the data tells you. Tapping into data also helps you offer more intuitive payment experiences. Think BNPL, embedded payments.
The rise of open banking in Europe, coupled with new messaging standards like ISO 20022, are making real-time and alternative payments much sough-after by consumers. All of these are based on a framework of efficient data sharing between trusted parties. New-age payments keep the consumer first. Data helps you keep your customers’ interests first and offer the best.

Also read: How to Target Customers with the Right Payment Strategy

3. Faster reconciliation
Data gives you greater control and visibility of your transactions. This helps you to track and reconcile payments easily, without errors, and on time. Having a single-window view into payments helps you align your accounts receivables (AR) and accounts payables (AP). This means timely payments and collections, and improved cash flow. More efficient accounts mean less headache and more cost and time savings. To tap into data, you must automate your AR and AP. Automating your AR helps you achieve more efficiency in your payments and reduce payment delays. Research shows that 89% of businesses get paid on time when using AR automation.

Know more: Why Should You Automate Your Accounts Receivables?

4. Improved business efficiency
Tapping into data improves your business efficiency. Co-relating payments data with data from other business functions helps you identify weak spots and inefficiencies. Payment analytics tools look at data in real-time and generate insights about how your business is performing. This helps you take timely action and make tweaks as needed. You save time, money, and effort, while improving precision and speed.

You might like: Here’s Why Payments Analytics is Good for Your Brand

How to use data for better payments?

You can be a well-rounded and empathetic brand that understands and keeps your customers interests first. When customers know and see you that way, they trust you. They talk about you, recommend you to others, and keep doing business with you.
Hence, when you use data, you have to do it sensitively. Always take their consent and respect their privacy. Educate and inform them about how the data will be used. Give them the option to opt out if they choose. Collect only the most essential info to process payments.
You also have to reassure your customers that their sensitive data is safe with you. They want to be sure that you are taking all necessary steps to keep their payments data secure. Trust is a big deal – once lost, it’s hard to recover. To win shoppers’ trust, design a consistent payment flow throughout the website. Use proper encryption and latest versions of 3D Secure 2 to keep payment data safe. Educate your customers on data safety and safe browsing behaviour. saWhen handling data, ensure you are compliant with all local laws in Europe, like PCI-DSS and GDPR. Alternatively, you could work with a PCI DSS-certified provider like Novalnet to avoid the hassle of getting a certification.

How can Novalnet Help?

If you are looking for a partner that understands your business and your market, we can help. We’ve made payment solutions simple so that you can avail the best of technology for your business, no matter where you are. As trusted advisors to Europe’s leading brands on all things payments, our state-of-the-art technologies and methods help businesses like yours accept payments globally. From our instant payment plug-ins to our AI-based risk management tools, we have the resources to get you up and running with your payments in a short time, and with zero hassle.
Reach out to us today to know more.

Jose Augustine

Jose Augustine is the Chief Business Development Officer at Novalnet with extensive experience in European payment industry and a knowledge powerhouse.