Technology, data and AI

The wealth of technology and data available to accountancy practices and their clients is vast, and growing at a rapid rate. Payment solutions may be just one piece of the complex jigsaw but an important consideration for informed decision making to underpin business growth. 

Why is this? Because innovation is also moving at pace in payments and being ahead of the curve can drive cost efficiencies and help accountants to lead from the front when advising businesses on what is right for them or not. 

For example, the use of NFT (Near Field Tech) for ‘tap to pay’ payment devices are being installed in meeting rooms right across the UK now providing a quick, almost instant, solution to pay for professional fees and so much more. Advisory services, including accountancy practices, have started to offer a live payment mechanism for online sessions with clients, enabling them to complete a transaction with a click of a button at the end of a phone, video call or similar. 

The payments market is continually evolving with new technology – ultimately aiming to deliver smoother and easier transactions for customers/clients and helping businesses with cash flow and forecasting. In my view, it’s imperative that an expert financial or payments advisor is involved in discussions for any new or ongoing payment mechanism from the outset, to appraise its strengths and weaknesses and decide whether that technology is fit for purpose. 

Once a decision on a payments solution is made, it is then the start of the journey to understand and utilise the data and insight that provides in order to support strategy. Payment data has never been more important to businesses because it’s the key to understanding customer buying behaviour. Delving into details such as how often items or services are purchased and location is essential.  

Whilst a good level of data can be accessed on the payment providers portal, or gateway for online/phone payments, there can also be significantly more benefits for connectivity into accounting platforms, CRMs and stock management tools. These provide greater efficiencies beyond a drop in processing fees because they often lead to sales boosts and business strategy.    

Choice really has to be celebrated because it helps to push boundaries – offering clients/customers a far better service and the chance for transactions to work hard for a business or accountancy firm. During the 19 years I’ve been running AcceptCards, there has been a real step change in the different levels of connections and integrations. The transfer of data into cloud accounting software such as Sage, Xero, Zoho or Quickbooks is impressive and those accountancy practices which have embraced this change are reaping the rewards. Those that are astute can alert clients to threats or changes coming down the track via the intelligence they analyse through the information available in payment portals. Going above and beyond is also helping to retain clients. 

We work with a growing number of accountancy practices utilising payments data to support  their own business growth story and their clients, through understanding their client’s payment behaviour. We often hear how they are helping firms looking to expand, trade overseas or move into new markets by looking at trends available in the payments portals. Having this data at their disposal means that they can carefully match up to a payments provider which aligns to their objectives, so they benefit from rates and contract deals which help them to flourish. 

Regulations driving transparency such as Payment Systems Regulator (PSR);  

At AcceptCards, we’ve been approached by countless businesses who don’t have the flexibility or control over their payments as a result of being entangled in contracts that are lengthy and unsuitable for their requirements. The issue here is that until recently there has been very little transparency for busy business owners and their advisors when it comes to implementing a payments solution that works for their needs. 

Thankfully the Payment Systems Regulator (PSR) has started to implement changes, including terminal contracts being limited to 18 months, which is welcome news and a step in the right direction. However, not all providers are included at this stage so it’s still a work in progress and I would like to see this addressed in the near future. 

Added to this, there have been positive changes in reporting too with a simple card payment history and charges summary now mandatory for payments providers to provide. This will make it easier for advisors and businesses to interpret the charges relating to payments, so that they find it easier to compare across different providers. This transparency is paramount to business success as firms require fast, trustworthy, secure payment solutions which help them to trade successfully without hidden charges coming down the track. 

I’d urge accountants providing full service advisory to be fully up-to-date with these changes or onboard the expert voice of a payments representative to guide them. Being equipped with this knowledge really can make a difference. I’m continually championing the need for customers to be in full control of their payment facilities and I sincerely hope that more will do so by taking the time to use the powerful tools available and access to independent support from payment experts.   

The pitfalls to avoid and predictions for the future. 

One of the biggest pitfalls is being swept into a decision for a payment solution reactively because, for example, a new website is being launched. My advice is to proactively take control and seek options that provide as much flexibility to make changes as they are needed. 

There is no extra cost to using a website platform that provides this future flexibility and control around payments and indeed other integrations that can add value to a business. In my mind, too many software solutions tie in with just one or two payment providers, leaving a business vulnerable to price increases and non competitive pricing. With such a wide choice of options available for websites and other software requirements like Epos systems for retail and hospitality, I’d always recommend exploring options thoroughly. 

Scheduling a review of payment solutions across each touchpoint across a business for at least every 18 months is essential. This should involve the key people in the business to interrogate the dozens of options available and how different providers could add value to an accountancy practice or a client’s business. Accountants can help, especially if the business doesn’t have an FD, and it’s important that they are able to navigate the payments market or utilise the services of a payments expert to carry out due diligence.  

In its early days, the payments industry was pretty much about cost saving and the price of a card machine, whereas today we spend much more time understanding solutions and requirements, as well as getting a full picture about how they will communicate with paying customers when taking orders and payments. Understanding this and current connectivity, with any planned changes, is vital for compatibility. 

I’m a firm believer that the business should be in control of their payments and not be tied in to a solution that makes it cost prohibitive to move, should the business requirements unexpectedly change and the incumbent is unable to support; or have to suffer price increases due to it being too costly to make that change.

As for the future, I’m excited by the changes I’m seeing in payments and that access to affordable and beneficial solutions are available for businesses of all types and sizes. An example that comes to mind includes the use of Open Banking to provide an additional payment method for instant pay by bank on website check outs, payment links with invoices and card machines in retail spaces. With a cost comparison of circa 0.4% compared to a business credit card at 1.9%, plus reducing chargeback risk, this is a payment that all businesses should consider as part of reviewing their payment options.  

Secondly, I’d like there to be serious conversations about how fraudulent transactions through major global social media platforms are addressed. These are a real risk to businesses and consumers alike, with payment providers footing the bill and I worry this won’t address the bigger problem at play. While thinking about risk and opportunity, I’d also like to see changes that will see payment charges drop for UK businesses trading internationally. This is costly and prohibitive to our economy at the moment and barriers such as this should be removed. 

And thirdly, as the payments sector continues to grow and innovate, I predict there will be some mergers announced with the big players all now being at the top of their game and accessing new technology. Advisors and the wider market need to keep abreast of this as new and evolving solutions enter the market and shape this increasingly competitive landscape. 

Overall, the future of payments is exciting and all businesses should have the opportunity to access the tools available to support their strategy and growth. Accountancy practices have an integral part to play as trusted advisors  working alongside those business owners who can reap the rewards, save money and time and plan for their future aligned to the information at their fingertips.