As discussed on numerous blogs, virtual banking and digital payments provide small businesses with a greater amount of flexibility than traditional banking.
There are no physical branches to deal with, lower fees, 24/7 customer service and the ability to support a cashless way of doing business. Users can also access and manage finances through any device: PC, laptop, tablet or smartphone.
The simplicity and ease of using virtual banking – such as the ability to complete payroll or invoice payments with a single mouse click – means employees have more time to focus on activities that can create value for the business, such as driving efficiency, innovation and recruitment.
Another aspect of this is that virtual banking enables small businesses to easily try new things, whether it’s exploring potential avenues of new business, taking advantage of particular events or just experimenting with what they want their business to ultimately be. Following are some uses cases that virtual banking could help with.
A craft-based business that sells items through marketplaces like Etsy, or a microbrewery that currently sells its beer through a handful of bars or shops, might want to boost its business with a physical store, but might not want to commit to a permanent location. An obvious answer is to set up a stall at a market where potential clientele are likely to be present.
While cash will still be used, increasingly people want to pay for items, however small, via digital forms of payment. To provide this, the business owner could purchase a cost-effective card reader that links to their smartphone – such as those provided by iZettle. Virtual banking makes it easy to integrate such a payment device directly into the bank account of the stall holder.
With digital payment an option, casual shoppers could be more likely to pick up one of the craft pieces or a few bottles of beer. Equally, a customer placing a bulk order will likely prefer to use this payment method rather than carrying large amounts of cash.
Giving e-commerce a try
Another possibility for a business with a physical shop is to experiment with e-commerce in a cost-effective way. Assuming they have a website, businesses can easily provide payment options through their virtual banking account.
Many virtual banks offer the option for businesses to add a payment button to their website, which then links directly back to the bank account of the business. In ePayments’ case, this can be a redirect button to a generic payment page, a payment page embedded in the website, or an application that sends invoices and payment links to customers. In terms of cost, this is usually a percentage of operation costs.
In this way, businesses can quickly determine whether there is scope to sell goods via their website, before committing too much money or resources to e-commerce. If there is an appetite from customers, it will be a new revenue stream, while the business loses nothing if there is little uptake.
Your business might have a physical store location but want the flexibility to open another temporary store in another location, either to take part in an event – such as a food or music festival – take advantage of seasonal trade, or determine whether opening a second permanent location is viable. Pop-up stores are an increasingly common sight in many towns and cities, with shipping containers or easy-to-assemble structures available in many locations for businesses to use for a short period of time.
Setting up to take non-cash payments in these locations can be tricky but, as with market stalls, virtual banking supports the ability to quickly set up digital payment devices that customers are likely to prefer to using cash.
Dabbling in international business
Some small businesses may be considering selling goods and services internationally, or working with suppliers and customers in different countries.
Virtual bank accounts support multiple currencies, meaning payments can be received in the local currency of each individual customer. In addition, transaction fees for international payments – if there are any – are lower than traditional banks.
And there is no need to spend time and money on setting up wire transfers, because virtual banks use the internet to make international payments.
Because of the low cost and overheads of making international payments using virtual banking, it becomes more affordable for small businesses to see what opportunities exist beyond their home market, without putting too much at risk.