There is no denying the fact that the global economy has changed tremendously over the past decade. One of the biggest changes in recent years has been the proliferation of cryptocurrency. Cryptocurrencies were originally popular with technology pioneers, conspiracy theorists, anti-government extremists, cybercriminals and other fringe groups.
However, bitcoin and other cryptocurrencies have since become a lot more popular. Cryptocurrencies have become very popular investments. Many people that invested became millionaires, which explains the sudden popularity of crypto wealth manager services.
Many mainstream groups have started adopting digital coins. One study found that around 32% of small businesses in the United States accept cryptocurrencies.
Should your business consider allowing customers to pay with cryptocurrency as well? There are a number of major benefits that you should consider if you want to subsidize your business with bitcoin.
Reduce your transaction fees
Financial institutions have become a lot tougher on their customers in recent years. They have continued to raise their transaction fees on merchants accepting credit and debit cards. According to a 2020 report by BankRate, many financial institutions have credit card transaction fees as high as 3.5%.
You can save money with these fees by getting fewer customers to use credit cards. Allowing customers to pay with bitcoin and other cryptocurrencies is one of the best ways to avoid these annoying fees.
Banks and credit unions are likely to keep raising transaction fees in the near future, especially as economic issues become more pronounced due to fallout from global supply chain shortages, the Ukraine war, the possibility of new Covid variants and other problems. Shifting towards a business model that incorporates cryptocurrencies might help ease these costs.
Avoid the risk of chargebacks
Chargebacks are some of the biggest problems that many businesses face. They are especially problematic for companies in certain industries with high priced items or products that create certain controversy. Of course, some of these customers are legitimately filing chargebacks after being victims of fraud. However, others are either trying to get their money back by pretending they were victims of fraud or were embarrassed after their spouse discovered a purchase or something that they didn’t want to explain.
There is not much you can do when a customer claims a chargeback on a transaction that they made with their credit card. The credit card company might do an investigation, but they are not usually very thorough. Unless there is obvious evidence that the customer filed the charge back in bad faith, the cost of the transaction will likely be reversed. You might lose your money and you won’t get the inventory that you shipped back.
You can get rid of the problems caused by chargebacks by accepting cryptocurrencies instead. Customers won’t be able to file chargebacks for transactions made with bitcoin. This is obviously unfortunate for people that are legitimate victims of fraud. However, it saves your business from the cost of customers falsely reporting chargebacks because they regret their purchase or wanted to buy something for free.
Cryptocurrency makes it easier to do business with people abroad
We live in a global economy now. Smart businesses try to expand the customer base by reaching customers all over the world whenever possible.
Unfortunately, both businesses and consumers encounter a number of complications when they try doing business with people in other countries. Some financial institutions outright block payments to companies in certain countries. They also often charge higher transaction fees, which makes it harder for companies to compete with counterparts in the customer‘s own country.
This is another issue that bitcoin helps eliminate. Bitcoin exists in an economy without borders. You can do business with people in different countries without all the hassles that you would encounter trying to accept bank transfers, credit cards or other traditional payment options.
Do business with customers that are more concerned about their privacy
One of the biggest reasons cryptocurrency was invented in the first place was that many people are concerned about their financial privacy. While there are many reasons that digital coins have gotten a lot more appeal among mainstream consumers, privacy is still one of the biggest selling points.
You will have a much easier time reaching customers that are very diligent about protecting their online and financial privacy if you accept bitcoin payments. You should give this idea some serious consideration.