Payments are Changing
Payments are getting diverse, and most companies nowadays include multiple-channel options in their payment gateways. And, safe payments remain one of the top concerns for any business.
But as people get more aware, their preferences are also not limited to just one aspect of the payment process.
Shoppers are looking for unified services that include fast and safe payments when they shop. In the same way, e-commerce merchants and logistics businesses are looking for payment channels that can best equip them to meet these needs.
Virtual payments are in demand. But you will need to think about some things before making a switch. Unless a payment method is compatible with your business needs, it can become more of a burden than a help. And more so for merchants who accept orders by phone or e-mail as an integral part of their business.
MOTO Payments for E-Commerce
Mail Order/Telephone Order or MOTO payments are virtual card transactions that a merchant makes on behalf of a customer. It is a type of CNP (card-not-present) transaction that supports both national and international payments. Customers can share their details by phone, e-mail, fax, or post, though the latter two are not used much these days.
It is simple and easy to streamline the payment process for MOTO orders. After your customer places the order, they provide you with their card details, name, address, etc. You can then use the details to complete the payment through a card machine, a virtual terminal, or a payment gateway. Once the payment is approved, the customer receives a digital receipt, and the amount gets added to your merchant account.
A startup or an online business can use MOTO payments as a low-cost tool for better reach and engage online shoppers. MOTO payments can help merchants to design a positive customer experience and boost sales. Coupled with the right measures to verify and settle payments and fight fraud, MOTO payments can be of good value to a business.
- Many shoppers prefer some form of personal interaction while making certain online purchases. MOTO payments offer this convenience for such shoppers.
- It also benefits older customers who may be unable to place an online order or make an e-transaction. If you’re keen to grow your customer base, having this payment option helps.
- MOTO payments are great for prompt invoice payments. This makes it easier to manage transactions for large B2B orders.
Are MOTO payments safe?
MOTO payments are safe when all the security measures are in place. But, like all virtual tools, it has its weak spots. These payments are seen as ‘high-risk’ due to the large-scale presence of data breaches and frauds in card transactions. Due to this, card issuers tend to charge MOTO merchants a higher rate.
Since MOTO payments are exempt from SCA (secure customer authentication) regulations, it becomes difficult to confirm the details. And in case of a fraudulent order or disputed transaction, it is usually the merchant who has to bear the chargeback fee.
Do PSD2 and SCA Apply to MOTO Payments?
No, they do not. Since MOTO transactions are done over the phone, they are exempted from PSD2 and SCA regulations. But, as a card-accepting business, you will have to be compliant with PCI DSS standards.
If you add MOTO as an optional feature, you will need to flag every MOTO payment as such. This will inform the card issuers, and they can successfully authorize the payment. The card issuing bank can raise an issue or reject a payment if it fails to meet its authentication standards.
How Can a Payments Partner Help?
A payment processor connects a merchant, consumer, and other financial partners. The PSP makes sure that payments and all related needs are made simple, safe, and reliable for both merchants and consumers. They protect a business from all risks.
Payment partners provide multi-layered solutions for different types of businesses. If you work with a PSP, you can give the customer a simple and secure experience from start to end. They help you protect a customer’s data, verify and confirm transactions, detect and avoid frauds, and meet regulatory compliance standards. You not only save up on time but also avoid extra costs.
Before choosing a PSP, you must note that not all of the processes every type of payment. And even when they do, the costs will be higher based on your business’ needs. Moreover, some providers tend to charge more than their quoted price. So, be sure to cover all the aspects when you choose your payment partner. And if you have a question, do not hesitate to ask.
Jose Augustine is the Chief Business Development Officer at Novalnet with extensive experience in European payment industry and a knowledge powerhouse.