Before the market opened, Shopify’s stock price jumped 21% as Shopify’s AI investments and cost efficiencies propel return to profitability. Shopify earnings for the third quarter surpassed predictions, showing higher growth. The company reported a revenue of $1.71 billion, which is a 25% increase compared to the year prior, which exceeded the expected $1.67 billion. Additionally, Shopify’s monthly recurring revenue reached $141 million, marking a 32% rise YOY, coming close to the projected $141.2 million.
The subscription-based revenue amounted to $486 million, representing a 29% boost YOY. Furthermore, Shopify witnessed the value of goods sold through the company over the quarter stood at $56.2 billion, indicating a growth of 22% compared to last year. In terms of profitability, Shopify presented earnings of $0.24 per share this quarter, showcasing an improvement from last year’s loss per share of $0.20 and surpassing expectations set at $0.14 per share.
The volume of payments processed through Shopify experienced the wave too, reaching a total value of $32.8 billion during this period—an increase of 31% YOY and exceeding estimates that were set at around $31.33 billion.
Key Takeaways
Shopify’s AI Investments and Cost Efficiencies Propel Return to Profitability, leading to a substantial increase in revenue, profits, and monthly recurring revenue. The success of the company can be credited to its strategic partnerships and the implementation of AI tools.
Shopify’s financial management has been positively influenced by reducing expenses through carefully planned workforce reductions and the divestment of specific business segments. These actions demonstrate the company’s dedication to improving cost efficiency while maintaining an approach to cautious hiring practices.
While the adoption of AI presents hurdles in many ways, the reason why Shopify’s AI Investments and Cost Efficiencies Propel Return to Profitability is all because of better planning and execution. Investors are keeping an eye on Shopify’s efforts to attract more businesses and utilize AI in order to maintain profitability over the long term.
Shopify’s all-inclusive commerce platform is designed to meet the needs of businesses of all sizes, offering tools for the management of online operations. The fact that known global brands have embraced it demonstrates its dependability and ability to adapt, establishing itself as a prominent player in the eCommerce industry.
AI Integration Fuel Shopify’s Remarkable Third Quarter Rise
Canada-based Shopify’s AI investments and cost efficiencies propel return to profitability. The increase in profits was a result of cost management and the integration of AI, which played a crucial role in attracting more businesses to utilize its platform. Shopify has introduced AI-powered tools like Shopify’s Magic Suite and Sidekick app to stay competitive in the competitive online market while also improving its delivery speed.
This online commerce facilitator, renowned for assisting businesses in launching their online stores, announced a profit of $0.55 per share, marking a sharp shift from last year’s loss of $0.12. Additionally, Shopify’s strategic collaborations with known brands have yielded higher results too. Notably, popstar Taylor Swift chose Shopify as the platform for selling her Eras Tour merchandise, resulting in record-breaking sales and website traffic on its launch day.
Shopify’s AI investments and cost efficiencies propel return to profitabilityadd to their summer wins, rapper Drake opened his new store, Drake Related, on Shopify. The company didn’t stop there, announcing in August a notable collaboration with Amazon. This new app within Shopify’s platform will allow US sellers to offer Amazon’s Buy with the Prime feature directly on their sites, a first outside of Amazon’s website.
The company in Ottawa announced that it earned $ 1.7 billion in revenue for the quarter ending 30th September. Its net income soared to $718 million, which includes a substantial $555 million gain from its investments. This is a sharp turnaround from the $159 million loss reported in the same quarter the previous year.
Shopify’s President Harley Finkelstein highlighted their strategic approach over the past quarters, focusing on achieving a balance between big operational goals and financial prudence. She spoke about shaping a new future for Shopify, indicating a transformative phase for the company.
Shopify has been adapting and evolving, aiming to recapture the strong growth it experienced as Canada’s most valuable company during the early days of the COVID-19 pandemic. This year, Shopify introduced a set of AI tools targeted at businesses using its platform, aiming to streamline their operations. At the same time, Shopify is enhancing its efficiency by automating tasks across its workforce.
These new AI offerings empower merchants to handle administrative duties and creative tasks, like answering customer questions or promoting their products, more effectively. Finkelstein emphasized their focus on blending human creativity with technological efficiency, noting that AI plays a crucial role in this synergy and will be a key component in Shopify’s ongoing strategy.
Strategic Workforce Reductions Drive Shopify’s Cost Efficiency In Q3
Although Shopify’s AI investments and cost efficiencies propelled return to profitability, it also saw its operating costs drop by 23% to $779 million in the third quarter. The company’s CFO, Jeff Hoffmeister, mentioned that this decrease largely came from reducing the number of employees.
This past summer, Shopify made a big decision to cut down its workforce by nearly 20%, marking the second time in under a year they’ve had to let employees go. Hoffmeister explained to investors that these tough decisions were key to improving the company’s financial management. He highlighted that the money spent on stock-based compensation also went down to $102 million this quarter from $150 million the previous year.
Jeff also noted that while they are still bringing on new people for critical roles, they’re doing so more cautiously, which has helped keep salary expenses lower than expected.
The company had been feeling the weight of costs from its delivery operations. Hoffmeister pointed out that selling these parts of the business to Flexport has helped reduce expenses somewhat. He mentioned that it’s still too early to tell the full effect of this deal, and he chose not to share financial specifics about it when asked.
The Hurdles And Prospects For Adopting AI Investments
For Shopify, introducing AI tools might just be what sets it apart, but getting businesses on board with this new tech could be a bit tricky. With a slowdown in demand and some businesses not too keen on trying new things, it might take some time before AI starts to pay off. Yet, if Shopify can prove that AI makes things more efficient, they could find new ways to make money from these innovations down the line.
As Shopify’s AI investments and cost efficiencies propel return to profitabilityInvestors are keeping an eye on how Shopify plans to draw in bigger companies and use AI to push their growth further. The company’s game plan to bring more businesses onto its platform and boost their sales is vital for staying on top. Plus, Shopify’s knack for staying innovative and outpacing rivals in the online market will play a big role in keeping its profits up.
About Shopify
Shopify is an all-in-one commerce platform that’s perfect for small and medium-sized businesses looking to spread their wings online and in person. It’s like a multipurpose channel for selling, letting business owners set up and run their shops across different channels — think websites, mobile, social media, online marketplaces, and even physical stores and pop-up shops. What’s best about Shopify is that it gives sellers a unified view of their business from one spot.
For those running online shops, Shopify comes packed with tools that make things like marketing, chatting with customers, handling payments, and shipping orders a whole lot easier. Plus, they’ve got this cool App Store that came about because Shopify lets tech-savvy users build their apps for Shopify stores and then sell them right in the App Store.
Shopify isn’t just for the small guys, though. It’s built to be super reliable and can handle the big leagues, too. Right now, it’s the engine behind over 800,000 businesses in roughly 175 countries. Big names like Red Bull, Tesla, GE, Nestlé, and Kylie Cosmetics trust it to power their online sales.
Conclusion
Shopify’s recent financial performance, characterized by substantial revenue growth, increased profitability, and enhanced cost efficiency, underscores the effectiveness of its strategic initiatives. The successful integration of AI tools and careful cost management has propelled the company to achieve remarkable results, surpassing market expectations.
The company’s ability to streamline operations and enhance its platform’s capabilities through AI-driven tools has contributed significantly to its profitability. Additionally, Shopify’s proactive approach to managing costs, including strategic workforce reductions and divestment of certain business segments, has further solidified its financial standing.
While the adoption of AI presents challenges, Shopify remains focused on demonstrating the long-term benefits of this technology to its user base. With a commitment to innovation and a comprehensive commerce platform catering to businesses of all sizes, Shopify is well-positioned to sustain its leading position in the competitive eCommerce landscape.
As Shopify continues to steer the busy “AI’s” market environment, its dedication to technological advancement and its ability to adapt to evolving industry trends will remain pivotal in driving its future growth and success. With its proven track record and global trust among businesses of varying scales, Shopify remains a key player in empowering businesses to thrive in the digital world.
Payment fraud poses a significant threat across industries, with pharmaceuticals, manufacturing, and finance being particularly susceptible. It is imperative for leaders in information technology and cybersecurity, including managers and team leaders, Heads of the ITs, CISOs, and IT managers, to stay informed about the current market of payment fraud, its associated costs, and the effective prevention strategies to comply with their existing fraud management strategies.
The AFP Payments 2023 Survey reveals a concerning trend, indicating that 65% of organizations fell victim to payment fraud in 2022. What’s even more alarming is that nearly half of these organizations (about 44%) were unsuccessful in recovering any of the pilfered funds.
Source: 2023 AFP Payments Fraud and Control Survey
Fraud management today is one of the most important aspects for businesses that are connected online and aiming to get rid of payment frauds effectively. Small and large businesses use specialized tools to prevent payment fraud and practice some important precautions and protocols for safety. These specialized tools and practices are crafted to proactively prevent, detect, and mitigate fraudulent activities. In this article, we will thoroughly discuss the core concepts of fraud management, explore the prevailing fraud management trends in 2024, and provide valuable insights to equip businesses in their battle against payment fraud.
What Exactly Is Fraud Management?
Businesses and organizations face diverse forms of fraud, perpetrated by employees, customers, third parties, vendors, and other entities like hackers. Annually, companies incur substantial financial losses amounting to billions of dollars due to fraudulent activities. The proliferation of online channels has particularly heightened the risk, impacting sectors such as e-commerce, banks, airlines, pharmaceuticals, and manufacturing. In response to these challenges, fraud management emerges as a systematic approach to handle fraud effectively within an organization or a company. Effectively reducing fraud requires early detection. It also requires a proactive method widely adopted by using analytics models with predictive capabilities to identify vulnerable transactions.
Providers specializing in fraud protection, whether high risk merchant account providers, payment service providers or dedicated fraud prevention software providers play a crucial role in preventing fraudulent behavior. They stay abreast of the latest fraud trends, employ AVS (Address verification), implement anti-fraud tools, and meticulously manage and analyze transactions, utilizing a combination of automated and manual order screening. Early detection of fraud not only minimizes revenue loss but also enhances customer satisfaction and retention. This multifaceted approach is essential for businesses fighting fraud.
Before rolling out an anti-fraud program, a crucial step involves assessing the organization’s vulnerabilities and pinpointing areas susceptible to fraudulent activities. A thorough risk assessment and analysis provide valuable insights into the organization’s weak points. Moreover, it digs deeper into the core to understand the likelihood, nature, and associated costs of potentially fraudulent activities.
Based on the assessment results, a risk-tolerance limit can be established to align with the organization’s specific needs. This approach proves beneficial by quantifying the risk assessment and enabling the company to concentrate its efforts on addressing more impactful and damaging instances of fraud.
Fraud management governance forms the framework of rules, practices, and processes dedicated to fraud management within a company. A robust and transparent fraud management governance policy serves as a deterrent to potential fraudsters, highlighting C-level commitment to minimizing and controlling fraud. Key elements of a comprehensive fraud management governance policy include:
● Promoting a culture of increased awareness among employees regarding fraud.
● Upholding the quality of each practice, risk, and rule process employed within the organization.
● Implementing ongoing surveillance for identifying and handling potential frauds.
● Conducting research on market trends in fraud prevention and mitigation technology.
● Providing clear descriptions of the process involved in investigating instances of fraud.
Aligned with the principles of good governance, each facet of a fraud management governance policy should be well-documented, appropriately delegated and designated, and easily accessible. Ideally, an individual within the organization should take the lead in spearheading the efforts related to fraud management governance. This comprehensive approach ensures a proactive stance in managing and mitigating fraud within the company.
Proactive Fraud Prevention
You’ve likely heard the age-old phrase, “prevention is always better than the cure,” and in fraud management, this saying holds true. Once a comprehensive fraud management plan is in place, and you’ve identified and assessed potential risks within your organization, the next crucial step is the implementation of controls, policies, procedures, and software. The primary aim is to prevent or significantly reduce the likelihood of fraud. Direct your efforts toward mitigating all three components of the fraud triangle:
● Understand the financial incentives that might drive individuals to commit fraud.
● Explore ways in which someone could rationalize committing fraud against your company.
● Assess and address the ease with which someone could commit fraud and go unnoticed.
By focusing on these key aspects, your organization can actively reduce the risk of fraud and fortify its defenses against potential threats. This proactive approach aligns with the wisdom encapsulated in the age-old saying, fostering a culture of vigilance and resilience in the face of fraud risk.
Fraud Detection
The efficacy of an organization in detecting fraud hinges on the proficient implementation of Reporting and Controls. These two strategies not only serve as preventive measures but also play a pivotal role in detecting fraudulent activities.
Controls, essentially tools, act as early warning systems for employees, signaling potential fraudulent behaviors. Deployment of these controls across various organizational layers is vital. However, employers must be well-versed in understanding how these controls operate and when to evaluate them.
On the other hand, Reporting stands as a critical facet of fraud detection. When correctly implemented, reporting mechanisms can identify and report fraudulent activities, safeguarding organizations from compromising sensitive information. The reports should encompass all essential details, including date and time stamps. This dual approach of controls and reporting forms a robust foundation for organizations aiming to enhance their fraud detection capabilities.
Monitor and Report
The effectiveness of an organization’s fraud management strategy significantly influences its overall success. Achieving this efficiency requires regular reviews and monitoring to ensure that the policies and practices within the fraud management strategy seamlessly align with the company’s vision and remain updated.
Additionally, a crucial step involves actively reporting any identified fraudulent activities to someone capable of addressing the issue promptly. This proactive reporting mechanism catalyzes timely action, preventing organizations from incurring substantial losses.
By adhering to these five stages during the implementation of the organization’s fraud management program, businesses can enhance their capabilities to detect and prevent suspected fraud, both internally and externally.
Benefits Of Effective Fraud Management Plans
● Safeguarding Against Severe Losses
Instances of fraud leading to substantial losses, which can jeopardize a company’s very existence, are fortunately rare but not unheard of. Whether it’s financial setbacks or the erosion of trust, the aftermath of such fraud leaves lasting scars.
The encouraging news is that the overall cost of implementing a fraud management strategy is not exorbitant, providing a shield against potential future losses.
● Gaining Valuable Insights
A well-structured fraud management strategy, when put into practice, offers valuable insights into an organization’s vulnerabilities. It serves as a beacon, illuminating both strengths and weaknesses that require attention. Armed with this knowledge, organizations can construct a more effective and efficient fraud management program, mitigating risks and fostering resilience.
● Instills Confidence and Attracts Opportunities
A well-executed fraud management strategy not only enhances control over an organization’s destiny but also instills a heightened sense of confidence. This increased confidence makes the organization more appealing to investors, business partners, and other potential opportunities.
Top Fraud Management Trends And Insights 2024
Scam Blocking Techniques and Tools Are Getting Attention
The need for a systematic approach to address the prevalence and complexity of scam trends is crucial. Relying solely on old security measures proves insufficient against the ever-evolving tactics employed by scammers. Businesses must acknowledge the significance of multi-layered strategies integrated with necessary tools and services to effectively safeguard against various types of scams.
A multi-layered fraud management approach integrates multiple security measures, each serving as a line of defense against different facets of fraudulent activities. This approach provides a comprehensive defense strategy that is not only more robust but also adaptable, thereby mitigating the risks posed by sophisticated phone scams.
To optimize efforts in preventing fraud, businesses and organizations must efficiently coordinate diverse risk signals, customer information, and data points. Through the consolidation and analysis of this information, organizations can devise a unified and well-rounded response. This approach aims to minimize risk, reduce customer friction, and mitigate the associated costs of prevention.
AIT SMS Fraud on the Rise
AIT, or A2P or International Traffic, represents a pervasive form of SMS fraud that orchestrates a surge in fake traffic through mobile applications or websites. Recent insights identify AIT as a prominent threat that individuals covering fraud prevention should be aware of, as projections are indicating its further escalation in 2024.
Here’s a common AIT scenario:
A fraudster makes a bot designed to generate fake accounts.
The bot initiates the delivery of OTP SMS to various mobile numbers.
The fraudster collaborates with a rogue entity to intercept the inflated traffic, avoiding actual message delivery to end users.
Together, they lay claim to the revenue generated, sharing the ill-gotten profits.
This cycle repeats, inflating revenues and manipulating conversion statistics.
As the application owner, you may find yourself burdened with the bill, even though the messages were technically delivered by the fraudsters. Fraudsters often target long-distance locations, as international destinations with higher delivery costs offer the most lucrative returns. Recent data reveals that over 43% of businesses have encountered AIT in recent years, with 60% of business owners seeing a noticeable acceleration in this threat.
To steer clear of AIT scams, businesses should opt for a trustworthy communication platform equipped with effective fraud prevention tools. One such tool is the Verify API, which allows you to enforce Two-Factor Authentication (2FA) for all A2P messages containing sensitive information. This proactive measure enhances security and safeguards your communication channels from fraudulent activities.
Escalation of Wire Frauds
Among the concerns that keep certified fraud examiners and anti-fraud professionals up at night, wire fraud stands out as a formidable adversary. Unlike schemes centered around credit lines and gift cards, wire fraud perpetrators are now setting their sights on the real estate market, participating in escrow closings.
Examining the losses, particularly in real estate, reveals a staggering 700% growth in wire frauds in the last five years, according to recent FBI data. Wire fraud poses a unique challenge because while institutions gather ample information about the payers initiating transactions, they possess scant details about the payees receiving the funds.
This gap in knowledge prompts fraud risk experts to explore improved methods for gaining insights into entire payee ecosystems. To safeguard against wire transfer fraud, it’s advisable to verify each transaction meticulously before releasing funds. Avoid contacting numbers provided in emails or on websites for verification. Instead, rely on the initial transaction information you received—trusted numbers that have been used in previous interactions before discussing financial matters. This practice enhances security and reduces the risk of falling victim to fraudulent activities.
Frauds Taking its Way Through ChatGPT
Fraud in the form of service is fueling the industrialization of fraudulent activities, posing a significant challenge to anti-fraud efforts. While cutting-edge technologies have been deployed to combat real-time transaction fraud and online scams, there’s been a concerning neglect of defenses against traditional, P2P, and physical frauds.
This neglect has given rise to a troubling trend where fraudsters are using modern tech integrated with older fraud schemes. Practices such as deposit and check fraud, and intercepting emails to pilfer information regarding your PII and credit cards also have become more sophisticated.
In some reported instances, criminals target unarmed mail carriers, they plunder for paper checks and items containing PII (Personally Identifiable Information), which are then sold in the black market, preferably the dark web. This results in exploitation for account takeovers, identity theft, and manipulation of checks by altering the amounts before depositing them into the mule accounts for laundering.
The integration of technologies like ChatGPT accelerates criminal activities. For example, a large-scale data breach at a retailer yields millions of card numbers, which fraudsters sell on the dark web, categorized by card type. The buyer of these card numbers can leverage ChatGPT to automate routines for swift and repetitive card-not-present attacks at an astonishing speed.
The key concept in understanding Fraud in the form of service is the division of labor among various players. With distinct groups involved in selling, exploiting, and buying PII, fraud transforms into a full-fledged industry. Fraudsters can navigate and operate within this industry more swiftly and easily than anti-fraud professionals can counteract. Countering industrialized fraud is poised to become a top priority for anti-fraud professionals in the upcoming year.
Phone Scammers Are Now Global
Phone scammers are adopting new tactics, using artificial identities to deceive individuals into thinking their calls are from reputable sources or friendly contacts. Employing urgency, fear, and empathy, scammers aim to manipulate emotions and gain unauthorized access to sensitive information through social engineering — sophisticated psychological attacks.
Expanding their reach globally, scammers now use local-number telecom technology, intended for global business-customer connections, to mimic phone numbers across different countries. This approach allows them to target a wider audience while remaining untraceable.
Businesses can leverage AI surveillance tools to identify and bar phone numbers associated with fraudulent activities, providing a proactive defense against evolving phone scam strategies.
Conclusion
As organizations grapple with the escalating threat of payment fraud, staying aware of the top fraud management trends in 2024 becomes imperative. The AFP Payments 2023 Survey underscores the alarming prevalence of payment fraud, emphasizing the urgency for robust fraud management strategies for 2024.
Through comprehensive governance policies, proactive prevention, vigilant detection, and strategic reporting, organizations can fortify their defenses. Embracing evolving trends such as scam-blocking techniques, addressing AIT SMS fraud, countering wire fraud escalation, and tackling fraud in the form of service will be crucial in navigating the evolving landscape of fraud prevention.
If you are planning to take your first step in your investment journey then you are at the right place. Everyone wants to be rich but most of people do not know much about investment. Unlike before, today we have a huge wealth of information over the internet. There are dedicated investment-related websites and blogs. There are numerous experts on different social media platforms who can guide you in learning how to invest. But, the major challenge is where to begin and which source to trust. This article will guide you with a well-researched list of the best investment websites for beginners in 2024 so that you can start your journey without ambiguities.
These investment websites provide you with the right tools and knowledge necessary to make informed investment decisions and effectively utilize their platforms. From educational materials to robo-advisors and trading simulators, an ideal investing website offers a multitude of valuable features. Let’s see some of the best investment websites tailored for beginners and grasp how to leverage them efficiently. But before we head-start, Let’s see how to select the best platform.
What Are Investment Websites?
Investment Websites serve as a means for individuals to acquire securities like bonds, ETFs, and stocks offering a valuable avenue for achieving financial objectives. Whether it is saving for specific goals such as building wealth or a child’s education over time, brokerage accounts are versatile. In addition to the primary function of facilitating investments and savings, these accounts often provide supplementary features, including access to research reports and various tools.
While an investment website allows you to withdraw funds at your discretion, it’s crucial to note that any gains on your investments may incur taxes, depending on your income.
Selecting The Right Investment Websites For Beginners
While there isn’t an all-purpose broker or investment website, certain crucial factors should guide your decision when selecting a stock broker for beginners.
Cost Structure: For beginners, the ideal brokerage accounts impose no commissions on online stock and ETF trades, which are typically the focus. However, be aware that some brokers may charge commissions or fees for more intricate transactions like options trading, mutual funds, and other products.
Account Minimums: Consider the minimum deposit requirement some stock brokers may have, ranging from $5 to $500 and sometimes even for free. The best investment accounts, in our view, eliminate account minimums. It’s worth noting that a few brokers may not permit fractional share investing, so ensure you have enough funds to acquire at least one share of an ETF or stock. Opt for low brokerages that enable anyone, even with limited capital, to initiate their investment journey.
Diversification of Funds: For many, delving into individual stocks, especially for beginners, might not be the optimal choice. The preferred investing platform for beginners should provide access to low-cost exchange-traded funds and fee-free mutual funds, offering a smart investment approach without necessitating an extensive understanding of the stock market.
Account Options: When selecting stock brokers, you have the option of a cash account or a margin account:
Cash account: You can use only the money available in your account.
Margin account: Borrow funds from your broker for investments. However, trading on margin carries risks, making it less advisable for novice and rookie investors. Margin interest rates are typically high, particularly in an environment of rising rates.
Top Investment Websites Right Now
1. Fidelity
Fidelity Investments stands out for its robust educational platform, but its real strength lies in its research capability. With a suite of top-notch calculators and research tools. Fidelity makes it simple for novice investors to identify the most suitable investing opportunities and strategies. For those unsure of where to start, Fidelity’s 200-plus investor centers offer in-person assistance.
As a low-cost broker, Fidelity impresses with no account minimums and $0 commissions on US ETFs, options trades, and stock. Investors benefit from competitive margin rates, potentially as low as 9.25%. Fidelity goes further in the mutual fund domain, offering zero-expense-ratio mutual funds with no minimum investment or account opening requirements.
To enhance the investor journey, Fidelity provides both a hybrid robo and robo-advisor solution, requiring only a $10 initial investment. If your balance is below $25,000, Fidelity waives these fees; beyond that, fees are 0.35% per year.
Pros:
Fidelity’s array of services is unmatched by many other brokers.
Beginners will find Fidelity approachable, while detail-oriented investors can customize their experience extensively.
As a privately owned entity, Fidelity has earned a solid reputation through decades of reliable client service.
Cons:
Some brokers outshine Fidelity in active trading capabilities.
The platform layouts may feel a tad dated on occasion.
E*Trade, with its $0 commissions for stocks and ETFs, stands out as one of the premier brokers for novice investors seeking an excellent trading platform and a diverse range of investment options. E*Trade provides a broad spectrum of account types, making it a well-rounded brokerage that caters to the majority of investors’ requirements.
For those new to investing, E*Trade offers an exceptional collection of tools and educational resources, facilitating a responsible start to investing. Notably, unlike some other online-based brokers, E*Trade boasts a physical branch network, offering beginners the option of in-person assistance if needed.
Pros:
Engaging features and tools that can be quite addictive.
The online POWER E*TRADE excels in catering to newbie traders.
Provides Morgan Stanley with thorough research.
Cons:
Does not support cryptocurrency trading.
Live data necessitates a $1000 minimum balance in the account.
Experienced traders might lean towards downloadable desktop platforms.
If you’re new to investing, JPMorgan’s platform is designed with user-friendliness in mind, featuring $0 commissions, even on mutual funds. While most brokers have zero fees for transactions for commission-free investing in specific funds, JPMorgan’s rare offering of $0 commissions on all mutual funds sets it apart.
For existing Chase customers with bank accounts or credit cards, JPMorgan Self-Directed Investing proves to be a particularly appealing choice. The app consolidates the management of all Chase accounts in one place. Notably, J.P. Morgan extends its appeal with an excellent robo-advisor platform accessible through the app. This makes it an intelligent choice for beginners looking to automate some investments while still retaining control over their stock portfolio. If you’re in search of a beginner-friendly brokerage account, JPMorgan’s investing platform is worth considering.
Pros:
JPMorgan Self-Directed Investing provides Chase Bank customers with a convenient avenue to invest in stocks, ETFs, options, bonds, and mutual funds.
The firm is recognized among our top brokers for banking services in 2023.
JPMorgan’s proprietary research often delves more deeply than the third-party research available through many other brokers.
Cons:
The platforms offered by JPMorgan are basic, lacking the advanced tools preferred by serious investors and traders, who may find more sophisticated options elsewhere.
Website navigation can be a source of frustration.
4. Merrill Edge
Merrill Edge, the online brokerage associated with Bank of America, offers a robust selection of $0 minimum investment options and research tools through a user-friendly platform. It proves to be an excellent choice for Bank of America customers, thanks to its seamless integration with the bank’s services and accessibility to various financial products.
In collaboration with Morningstar, Merrill Edge presents an Investing Classroom featuring short courses covering funds, stocks, ETFs, bonds, and portfolio types. This feature contributes to its status as one of the best investing websites. Each course includes quizzes to assess your knowledge and reinforce your learning. Don’t overlook the webinar series, delving into topics ranging from financial psychology to sustainable investing.
The Tools section provides resources to assist in number-crunching for college planning, retirement goals, and general personal finance. Users also gain access to the BofA Research platform, offering market insights, analysis, and research reports from Bank of America.
Pros:
Dynamic Insights, Portfolio Story, and the Fund and Stock Stories stand out as top features, especially for everyday investors who have benefited from $0 commission stock trades.
Merrill Edge provides access to high-quality Bank of America Securities proprietary research.
The platform boasts a premium design feel.
Cons:
Certain site elements may experience delays in loading.
Merrill does not offer services in cryptocurrencies, futures, foreign exchange, fractional shares, or paper trading.
5. Charles Schwab
An influential player in the brokerage landscape, Charles Schwab played a pivotal role in driving the industry toward lower-cost trading. To enhance accessibility, they eliminated trade commissions entirely in 2019! Moreover, their recent merger with TD Ameritrade brings together the best features and resources from both platforms.
Charles Schwab provides an extensive array of educational content through its Insights & Education section, covering investing strategies, market updates, retirement planning, and more. Schwab offers clients access to third-party research reports and tools, along with webinars, workshops, and online courses to enhance investor skills.
After the completion of the merger with TD Ameritrade, Schwab investors will gain access to courses and resources from its Education Center. Additionally, TD’s popular Thinkorswim platform, featuring paper trading and advanced technical analysis tools, will become available.
Pros:
In contrast to numerous brokers emphasizing short-term trading, Schwab promotes a long-term perspective among its clients.
Schwab introduced enhanced services and more favorable pricing for clients with higher net worth in July 2023.
Investors and traders can access a comprehensive library of research and content at Schwab.
Cons:
Cryptocurrency trading is not offered at Schwab.
The fee structure for mutual fund transactions is needlessly intricate.
6. SoFi
SoFi stands out as an excellent broker for beginners, offering an outstanding user experience and combining investing, banking, and budgeting into one comprehensive platform. Unique features include fractional share investing and access to IPO investing for smaller investors.
SoFi distinguishes itself by providing commission-free options trading, emphasizing long-term responsible investing, and offering a variety of educational tools. These features make SoFi an ideal choice for both beginners and seasoned investors. Fractional shares enable investors to enter the stock market with just a few dollars.
SoFi’s user-friendly platform is particularly well-suited for those who find the stock market intimidating. SoFi also caters to retirement savers by offering IRAs, a feature not found in some other beginner-friendly brokerages. If you’re seeking an excellent online trading platform for beginners, SoFi is one of our top recommendations.
Pros:
SoFi simplifies the process of saving, investing, borrowing, and insuring, providing a one-stop solution.
SoFi clients enjoy a range of popular options for investments like ETFs, stocks, IPOs, crypto, automated investing, and stock options.
SoFi stands out by offering 22 cryptocurrencies, surpassing numerous other brokers in the current market.
Cons:
The platform does not provide open-ended individual bonds or funds.
The asset charts are very basic, lack advanced features.
7. Ally Invest
A relatively recent player in the brokerage scene, Ally Invest proves to be a solid choice for individuals already engaged with Ally Bank seeking an uncomplicated way to extend their financial endeavors into the realm of investing.
The convenience extends to Ally’s mobile app, allowing users to access their accounts, receive quotes, and execute trades. Recognized for outstanding customer service and progressive digital banking features, Ally ensures a seamless transfer of funds between your bank and investment accounts.
Pros:
When it comes to the integration of brokerage and banking combinations, Ally stands out by providing universal account access and facilitating instant money transfers between accounts.
It is recognized as one of the best for banking services in 2023.
Ally further impresses with a no-load $0 mutual fund trade. Particularly noteworthy for beginners, Ally’s trading ticket and options matrix offer enhanced usability.
Cons:
While Ally Invest excels in certain aspects, its trading tools lag behind those of industry leaders such as Fidelity and Charles Schwab, albeit at a significant distance.
Additionally, although Ally’s educational content is robust, it is somewhat concealed – not available in the app and challenging to locate on the website.
8. Vanguard
For those seeking the most cost-effective investment option, Vanguard emerges as a top contender. This prominent American fund management group has established itself as a discount online brokerage, offering unparalleled value on both sides of the Atlantic, whether you’re investing in a stocks and shares ISA or a brokerage account.
Investing in Vanguard’s LifeStrategy portfolios can cost as little as 0.22% annually, with a platform fee of 0.15%. While Vanguard may not provide extensive educational resources on its site, it shines for individuals with some existing knowledge. The LifeStrategy portfolios cater to various risk preferences, ranging from cautious to aggressive.
Pros:
Extensive variety of mutual funds available.
Commission-free trades for stocks, options, and ETFs.
A recognized leader in offering low-cost funds.
Competitive interest rate on uninvested cash.Maintains high-order execution quality.
Cons:
Utilizes a basic trading platform.Provides limited research and data.
Conclusion
Selecting the best investment website for beginners requires careful consideration of factors like cost structure, account minimums, diversification of funds, and available account options. Fidelity impresses with its educational platform and comprehensive services. E*Trade stands out for its diverse investment options and user-friendly tools. JPMorgan’s platform is designed for user-friendliness, especially for existing Chase customers.
Merrill Edge, associated with BOA, offers seamless integration and a variety of educational resources. Charles Schwab provides extensive educational content, and SoFi stands out with its comprehensive platform. Ally Invest is a solid choice for Ally Bank customers, and Vanguard offers cost-effective investment options with a variety of mutual funds. Each platform has its strengths and considerations, catering to different preferences and needs in the dynamic landscape of online investing. If you want to be financially responsible and increase your earnings then start investing with these best investment websites.
The term “Financial responsibility” might sound heavy, perhaps mimicking your dad’s or mom’s voice in your head. However, being financially responsible is simply about maintaining control over your money instead of letting it control you. It’s a crucial aspect of shaping your path to adulthood.
When you exhibit financial responsibility, you cultivate healthy spending habits that prevent you from overspending. This approach allows you to enjoy your money and the sense of security it provides, eliminating the monthly worry of struggling to pay your bills.
Integrating financial management into your life’s essential processes and incorporating it into your ongoing plans or aspirations is crucial. Even if your finances seem intricate and perplexing, the ten valuable tips in this article should assist you in taking command and gaining control over them.
What Exactly Is Being Financially Responsible?
Practicing financial responsibility entails managing your money wisely and making informed decisions. It involves the skillful handling of saving, budgeting, and investing. Additionally, it means being mindful of spending habits and preventing the escalation of debt.
Financial responsibility is significant as it empowers you to steer your finances effectively and make choices aligned with your best interests. When you exhibit financial responsibility, the likelihood of falling into debt or bad financial choices is on the list. It serves as a cornerstone for realizing long-term financial objectives and establishing a robust foundation for your future.
Top 10 Tips For A Financially Responsible Future
1. Pay Yourself What You Are Worth and Cut Your Expenses
The first step is to ensure you’re compensated fairly by understanding your job’s market value. Evaluate your productivity, contributions, and skills to determine your worth. Research both external and internal salary rates for your role. Advocating for your deserved salary showcases market awareness.
List your degrees, qualifications & skills, certifications, and achievements when negotiating pay. This demonstrates your alignment with job requirements and helps in salary research.
However, financial stability requires spending less than you earn regardless of income. Cost-cutting efforts in various areas can lead to significant savings. Small adjustments can make a difference without major sacrifices.
2. Controlling Credit Card Debt
Credit cards serve as a valuable tool for significant purchases and establishing a positive credit history. Many credit cards offer enticing rewards like cash back or airline miles, enhancing their appeal. However, the convenience of credit cards may lead to the swift accumulation of debt. This holds as an American’s average credit card debt is $6,365. Fortunately, there are practical steps to prevent the accrual of substantial debt.
Source: Statista – Credit card debt in the United States from 2nd quarter 2010 to 2nd quarter 2023
To maintain a healthy credit profile, consider the following tips:
Ensure to settle your balance entirely every month.
Make on-time payments consistently.
Aim for a low utilization ratio, ideally below 30%.
Familiarize yourself with the details of your credit card agreement.
Avoid opening too many accounts in a short timeframe.
Using credit cards wisely contributes to improved financial well-being. Monitoring your credit score is equally crucial. Experian and many other online services offer free credit monitoring services, which provide access to your credit report and FICO Score, along with real-time alerts about changes in your credit report, allowing you to address potential issues promptly.
If your credit score falls below your desired level, bringing overdue accounts up to date and consistently paying bills on time can be instrumental in enhancing it.
3. Tackle Your Debt
Just as we discussed earlier in relation to credit cards, carrying debt can pose challenges in managing your monthly expenses. Additionally, it can elevate your debt-to-income ratio, potentially hindering progress toward your financial objectives. If you’re grappling with high-interest debt, incorporating debt repayment into your financial routine can be a smart move.
Consider setting “debt payoff” as one of your financial goals and review your budget to determine the amount you can allocate each month to reduce your debt. Explore various debt payoff strategies, such as the debt avalanche method or the debt snowball method, to find an approach that aligns with your financial circumstances and objectives.
4. Budgeting for Responsible Financial Well-Being
Establishing a budget isn’t exclusive to business owners or finance experts; it’s a crucial practice for everyone. It serves as a foundational financial habit that complements other financial planning strategies, applicable regardless of your financial situation.
Once you’ve crafted a budget, you gain clarity on your investment capacity, determine reasonable contributions to your emergency fund, and identify the amount available for monthly debt repayment. Here are some tips to start by:
Determine your net income: Your gross income, or take-home pay, is the foundation of a successful budget. It is all of your earnings less the costs of taxes and employer-sponsored benefits like medical coverage and plans for retirement.
Monitor your spending: List your fixed expenses to start the budgeting process. These are regular monthly expenses like utilities, lease or mortgage, and auto payments. Next, list your variable expenses, which include things like gas, groceries, and pleasure that could change on a monthly basis. There are chances for possible savings in this area.
Establish achievable goals: Prior to scathing into the details you’ve tracked, outline a list of your short-term and long-term financial goals. Possibly in a year or three, short-term objectives could include things like setting up an emergency fund or paying off credit card debt. Conversely, long-term objectives, like funding your child’s education or retirement, might take longer than five years to complete.
Create a strategy: This is the phase where all the elements converge: your actual spending versus your intended expenditure. Utilize the compiled list of fixed and variable expenses to project your upcoming monthly outlays. Then, align this with your priorities and net income. Contemplate establishing precise—and achievable—spending limitations for each expense category. You may opt to categorize your expenses further, distinguishing between necessities and luxuries. Consider adopting the 50-30-20 plan—allocating 50% to needs, 30% to wants, and 20% to savings.
Modify your spending to adhere to the budget: Having established your expenses and income, you can now make any required adjustments to prevent overspending and allocate funds toward your objectives. Prioritize trimming your discretionary “desires” as the initial area for potential reductions.
5. Prioritize Your Financial Well-being
Taking control of your interest and borrowing expenses may seem challenging, but in reality, it boils down to discerning between necessities and luxuries. For instance, while having a car may be a necessity, owning a high-end model is a luxury. If you can’t afford to pay for it outright, it’s advisable to opt for a more budget-friendly option.
Similarly, having a place to live is a necessity, but residing in a mansion is a luxury. For most individuals, a mortgage is a necessary step to own a home, but it’s crucial to do so in a financially responsible manner. A general guideline is that the cost of your home shouldn’t exceed two to 2.5 times your annual income. Additionally, a healthy measure is ensuring that your monthly mortgage payment doesn’t surpass 30% of your monthly take-home pay.
Beyond steering clear of excessive spending on your home, it’s advisable to make a substantial down payment that eliminates the need for private mortgage insurance (PMI). If meeting these purchasing criteria proves challenging, consider renting until you’re financially ready to make a home purchase.
6. Build Your Emergency Fund
Regardless of your income or expenses, having an emergency fund is crucial for financial stability. The size of this fund should align with your lifestyle, with a common recommendation being enough to cover three to six months of expenses.
To ease into the habit of saving, start with a modest initial contribution. This ensures your cash flow isn’t strained, reducing the likelihood of abandoning your savings routine.
Opt for direct deposit to keep your savings out of sight and out of mind. Many employers offer this option, allowing you to allocate funds to multiple accounts.
While an emergency fund is essential, avoid allocating an excessive portion of your savings to it. Since it’s meant for quick access, it’s often stored in low-yield options like a savings account with minimal interest.
Once you reach your target for the emergency fund, redirect your contributions to an account that can generate returns, such as your retirement account. This strategic move allows your money to grow over time, maximizing its potential.
7. Buckling Up Your Investments
Starting your investment journey may feel overwhelming as a newcomer, but it can be easy with little knowledge. Questions about the required amount, how to initiate the process, and the best strategies for beginners can be daunting. However, investing early in your life can yield substantial returns, thanks to the power of compound earnings. This phenomenon allows your investment returns to generate their own returns, leading to significant growth over time.
Whether you’re committing $1,000 monthly or a more modest $50, establishing a regular contribution to your investments is key. This consistency ensures a steady influx of funds into your investment portfolio. To set you on the right path, here are some fundamental insights to consider before diving into the world of investing:
Determining the right amount:
It is a crucial decision, influenced by your financial situation, investment goals, and the timeline for achieving them.
For retirement, a common investment objective, consider allocating 10% to 15% of your annual income. If you have a workplace retirement account, like a 401(k), that offers employer matching, prioritize contributing enough to receive the full match. This matching contribution is essentially free money, a valuable boost towards your retirement goals.
For other aspirations such as homeownership, travel, or education, evaluate your time horizon and financial needs. Break down the required amount into manageable monthly or weekly investments to stay on track.
Opening an investment account:
If you lack access to an employer-sponsored retirement plan, an individual retirement account (IRA) is a viable option, offering both traditional and Roth IRAs. However, if your investment goals extend beyond retirement, explore taxable brokerage accounts. These accounts provide flexibility, allowing withdrawals without additional taxes or penalties, making them suitable for various financial objectives.
Create an Investment Approach
Selecting the right investment strategy hinges on your specific saving objectives, the financial milestones you aim to achieve, and the time frame for reaching them.
For long-term goals extending beyond 20 years, such as retirement, a significant portion of your funds can be allocated to stocks. However, delving into individual stock selection can be intricate and time-intensive. For most individuals, a prudent approach is to invest in low-cost stock mutual funds, index funds, or ETFs, providing diversified exposure to the stock market.
Conversely, if you are saving for a short-term goal with a horizon of less than five years, the inherent risk associated with stocks suggests a more conservative approach. Safeguard your funds in secure avenues such as online savings accounts, cash management accounts, or low-risk investment portfolios to preserve capital and liquidity.
A Primer on Investment Choices
Upon determining your preferred investment strategy, the next step involves selecting specific assets for your portfolio. Every investment comes with its own set of risks, and comprehending the characteristics of each instrument, evaluating its risk profile, and ensuring alignment with your financial objectives is crucial. Here are some popular investment options, particularly suitable for beginners:
Stocks
Bonds
Mutual Funds
Exchange-traded funds (ETFs)
Understanding the nature of these investments will empower you to make informed decisions that align with your financial goals and risk tolerance.
8. Prepare for the Unforeseen
Contemplating mortality may not be pleasant, but ensuring the well-being of your loved ones in the event of your demise is a responsible step. Even if you’re presently unattached with no dependents, securing an affordable life insurance policy while you’re younger is a prudent financial move.
The process of obtaining life insurance is straightforward, and it doesn’t have to strain your monthly budget. Although there is a multitude of life insurance products available, opting for a term insurance policy is often considered a clear-cut choice for many individuals seeking the coverage they require.
As you navigate significant milestones like marriage, homeownership, or parenthood, a term insurance policy becomes a valuable asset, offering financial protection in the event of your absence.
9. Update Your Will
You might be wondering about the relevance of a will in the realm of financial responsibility. A will, formally known as a last will and testament, is a legal document that outlines your preferences concerning the distribution of your assets and finances after your passing. It stands as a crucial element of financial responsibility, ensuring that your wishes are upheld. Without a will, the execution of these wishes may be uncertain, leading to additional time, costs, and emotional strain for your heirs.
While no single document can anticipate every posthumous issue, a well-crafted will can address a significant portion of them. Surprisingly, only 33% of Americans had a will in 2021. Whether you have dependents or varying degrees of assets, having a will is essential. While you can create a basic will on your own, seeking guidance from a legal professional is advisable for added assurance. To enhance the protection of your loved ones and streamline the posthumous process, it’s wise to consider updating your will.
10. Maintain Accurate Tax Records
Last but not least, neglecting to keep meticulous records may result in missing out on potential income tax deductions and credits.
Establish a systematic approach and maintain it throughout the year. This proactive strategy is far more efficient than the last-minute scramble during tax season, preventing oversights that could have otherwise contributed to savings.
Conclusion
Embracing financial responsibility is not just a distant goal but a practical and achievable path to securing your financial well-being. By incorporating the ten essential tips provided, you can navigate the realm of personal finance with confidence and control.
Understanding the fundamentals of financial responsibility involves more than just budgeting; it requires a holistic approach to managing your money wisely. From addressing credit card debt to strategically investing for the future, each tip contributes to a comprehensive strategy for long-term financial success.
Take the time to pay yourself what you’re worth, control credit card debt, tackle existing debts, and establish a realistic budget. Prioritize your financial well-being by distinguishing between necessities and luxuries, building an emergency fund, and initiating a well-thought-out investment journey.
Remember, your financial journey is not complete without preparing for the unforeseen. Securing life insurance, updating your will, and maintaining accurate tax records are integral components of a responsible financial plan.
In essence, being financially responsible is about taking charge of your financial destiny, making informed decisions, and cultivating habits that lead to a secure and prosperous future. As you embark on this journey, keep in mind that financial responsibility is not a destination but a continuous process of learning, adapting, and thriving in the ever-changing landscape of personal finance.
Running an online business requires an effective method for receiving payments, and payment gateways serve as financial tools that facilitate the collection of payments through credit or debit cards. Nowadays, where online shopping is prevalent, and physical cash is less common, having an accessible and user-friendly payment gateway is essential for engaging both consumer and business clientele.
To make an informed choice for your business, it’s crucial to evaluate factors such as cost, features, and supported payment methods. Read on to discover the best payment gateways in 2024 suitable for businesses that rely on card-based transactions.
A payment gateway is a software application utilized by merchants to facilitate the acceptance of various electronic payments, including credit cards. Functioning as encryption systems, these gateways play a crucial role in safeguarding sensitive information like credit card numbers during the transfer from customers to merchants. Following this secure exchange, the gateways transmit transaction details to both the customer’s bank and the merchant’s acquiring bank, responsible for credit card processing services.
The payment gateway assumes the responsibility of authorizing credit card transactions and ensuring the seamless transfer of funds from the customer’s account to the merchant’s account. It’s common for payment gateways to impose a monthly fee along with a per-transaction fee for their services.
How Payment Gateway Works?
The structure of a payment gateway can be divided based on its use in either an online payment portal or an in-store setting. For online payments, the gateway must be hosted on the website. This can be done through a third-party service provider or directly by the merchant using an API. This integration enables the website to interact with the payment processing network and receive a response from the issuing bank.
In an in-store setting, a payment gateway is utilized through a physical card reading device or a POS terminal. These devices connect to the processing network via a secure internet connection, ensuring a seamless transaction process.
Key Players In The Payment Gateway Ecosystem
Merchant:
The merchant is the individual or business conducting online sales of goods or services. To enable online transactions, a merchant requires a merchant account, essentially a bank account tailored for online transactions. Integrated with the payment gateway, this account ensures secure transaction processing, serving as the destination for incoming funds after settlement.
To open a merchant account, thorough research is necessary to select a provider that aligns with specific business requirements.
Customer:
Customers constitute the primary participants in the payment gateway ecosystem. They utilize various online payment methods, including debit or credit cards, net banking, UPI, or online wallets, to make purchases online.
Acquirer and Issuer Bank:
Two distinct types of banks operate within the payment gateway ecosystem. The acquirer bank manages payments on behalf of the merchant, housing the merchant account. This bank serves as the endpoint for financial transactions routed through the payment gateway, ultimately receiving the funds.
Conversely, the issuer bank is where the transaction originates. This account belongs to the customer initiating the payment for a product. The issuer bank represents the customer and supports diverse payment methods like credit cards, debit cards, or net banking.
Payment Gateway:
Serving as the intermediary between the merchant’s website or app and the acquirer and issuer banks, the payment gateway plays a crucial role.
When a customer makes a purchase on the merchant’s platform, the payment gateway facilitates the smooth progression of the payment. It ensures the secure transfer of payment information and manages the authorization and settlement of transactions.
Payment Processor:
The payment processor is responsible for overseeing the technical connections between the payment gateway, the acquiring bank, and the issuer bank. It validates and securely routes payment transactions. Both the payment gateway and the payment processor are essential components in effectively managing online payment transactions.
How To Select The Best Payment Gateway?
Selecting the appropriate payment gateway for your business is a crucial decision. Opting for a gateway that doesn’t align with your business model can potentially lead to significant financial losses and a decline in customer satisfaction.
Consider the following key factors:
Cost:
The foremost consideration when choosing a payment gateway is the overall cost it incurs. The costs associated with payment gateways typically involve a set-up fee, a monthly fee, and a transaction fee.
To determine the most cost-effective option for your business, it’s essential to evaluate both the volume and value of your transactions. Many payment gateways offer competitive transaction fees, often around 2.9% + 30¢. Carefully assessing these costs ensures a financially prudent choice for your business.
Accepted Card Types:
The widely utilized credit cards—Visa, MasterCard, and Amex—are typically supported by most payment gateways. However, if your customers commonly use alternative card types like debit cards or Diners Club cards, it’s crucial to ensure that your chosen payment gateway accommodates these variations.
Holding Period:
While payments are generally swiftly approved, there is a brief holding period before the funds are settled into your account. This delay allows for the processing of refunds and handling chargebacks. Holding periods can range from 1-7 days, varying among payment service providers. Depending on your cash flow needs, you can opt to receive immediate payment or wait for the designated settlement period.
Multiple Currency Support:
For businesses engaged in international transactions, verifying that your selected payment gateway can process payments in various currencies and from different countries is essential. Enabling customers to pay in their preferred currency is paramount. Additionally, it’s advisable to check for any associated fees related to foreign currency transactions.
Seamless Integrations:
Ensure that your chosen payment gateway seamlessly integrates with your shopping cart, accounting software, and any other tools essential for your business operations. This integration capability enables automation in your accounting processes, ultimately saving valuable time.
Customization Options:
Consider whether the payment gateway provides customization features. For instance, having the ability to incorporate your logo or modify the payment page’s color scheme can enhance your brand representation. Many gateways offer this through an API, though it’s worth noting that not all gateways provide such customization options.
Emphasis on Security:
Prioritize security when making your payment gateway selection. It’s crucial to confirm that the gateway employs state-of-the-art encryption technology to safeguard your customers’ credit card details from potential theft.
PCI Compliance:
Verify that the chosen payment gateway adheres to PCI compliance standards. This compliance involves following the PCI DSS standard, a set of security regulations mandatory for all businesses engaged in credit card payment processing. Choosing a PCI-compliant gateway ensures that your business meets the required security standards.
Top 10 Payment Gateways In 2024
There are many payment gateway options now with the rise of e-commerce and online payments, here is our best pick for the reliable payment gateway solution for 2024:
1. Authorize.Net
Pricing: $25 monthly
Processing Charges: 2.9% + an additional $0.30 for every transaction
Authorize.Net, affiliated with Visa, accommodates major credit cards like Mastercard, Visa, Discover, American Express, JCB, and Diner’s Club. It also supports digital payment services such as PayPal, Visa Checkout, and Apple Pay. While it caters to global transactions, your business must be registered in the US, Canada, UK, Australia, or Europe.
Starting with the gateway-only plan, which incurs no setup fee, it involves a monthly gateway fee, a per-transaction charge, and a daily batch fee. For larger business needs, enterprise solutions provide customized pricing.
Pros: Tailored fraud prevention with AFDS Offers both payment gateway and one-stop solution for flexibility No setup charges, minimizing the initial costs
Cons: Additional charges for specific features like e-check and Account Updater Merchant account approval may take up to 5 business days, potentially delaying the setup.
2. PayPal
Pricing: Free
Processing Charges: 2 to 4% + an additional $0.49 for every transaction
A stalwart in online payments, PayPal facilitates quick registration and online payment acceptance. It extends its services to mobile and in-person transactions, among other financial solutions.
Online card payments typically incur a $0.49 fee plus an additional 3.49%. QR code payments reduce costs to 1.90% for transactions above $10 or 2.40% for transactions of $10 or less, plus the $0.49 fee. Businesses usually face no monthly recurring fees. In-person payments cost 2.70% for card-present transactions or 3.50% plus $0.15 for keyed transactions.
Pros: Versatile payment solutions for diverse business needs Strong global recognition instills customer trust Efficient customer support post-sale Transparent pricing with no monthly fee
Cons: May not be cost-effective for high-volume sellers Known for holding funds from sellers and occasional account closures with limited recourse.
3. Stripe
Pricing: Free
Processing Charges: 2.9% + an additional $0.30 for every transaction
For companies of any kind, Stripe offers outstanding adaptability with over 660 integrations. Because of its highly configurable nature and application programming interfaces, it can be easily integrated into applications for smartphones and other software, catering to both startups as well as big corporations. Robust identification of fraud and tools for risk management, a flexible checkout procedure, the capacity to process payments via the Internet in over 135 currencies, and low-cost, programmed clearinghouse processing are some of the key features. Stripe offers flexible monthly agreements and reasonable fees when compared to different payment gateway service providers.
Pros: Zero monthly charges Zero setup charges Developer-friendly Highly versatile with many integrations and customizations
Cons: Instant deposits cost 1% of the transaction No native inventory management
4. Square:
Pricing: Free
Processing Charges: 2.6% + an additional $0.10 for every transaction
Founded in 2009, Square has become a prominent financial services and mobile payment provider, generating over $3 billion annually. Offering an intuitive and user-friendly experience, Square gained popularity in online payment gateways. Without needing to know programming or other specialized technical abilities, consumers can create an effective online presence with its tools.
Square offers several more sophisticated plans with recurring costs in addition to a starter package at no cost. Dispute resolution and live mobile assistance are included with all plans. On a device you own, Square’s standard POS is free to use through a mobile app. Advanced attributes, such as shortage in inventory alerts, are only available with a monthly POS plan.
Pros: Zero monthly charges Clear pricing on a per-transaction basis Cheap and best hardware BNPL options for online and in-person transactions Numerous add-ons and integrations are available
Cons: Loyalty programs for customers cost extra No additional phone supportInflexible support hours for customers
5. Braintree:
Pricing: Free
Processing Charges: 2.59% + an additional $0.49 for every transaction
Since its acquisition by PayPal in 2013, Braintree has become closely associated with the renowned payment service provider. What sets Braintree apart is its provision of dedicated merchant accounts, a rarity among payment service providers. Some notable users of Braintree’s payment solutions include Uber, Airbnb, and GitHub.
Pros: Drop-in payment widget with a best-in-class UI Accept multiple payment methods with a single implementation Single dashboard to manage all user subscriptions
Cons: Coupon management is not very robust Setup is challenging, lacking seamless migration from existing payment systems Slow response from customer support
6. Stax:
Pricing: $99 per month (no transaction fees)
Stax distinguishes itself with comprehensive customization tools that make branding tailored to your business easier than with other payment gateways. Its custom branding options allow you to tailor invoices, receipts, and website payments to align with your brand. Stax integrates seamlessly with popular business software programs like Xero, QuickBooks, MS Teams, Hubspot, Slack, Zoho, Google Docs, and Calendly.
Unlike most payment gateways, Stax adopts a flat monthly fee model instead of charging a percentage of each transaction, though there are still flat per-transaction fees.
Pros: No charges for transactions; pay one flat-rate monthly subscription fee. Free mobile or terminal reader Scheduled payments and Recurring invoices option Digital invoicingOption for ACH processing
Cons: Additional fees per terminal1% charge for same-day access to funds
7. Payment Depot
Pricing: $79 flat fee monthly
Processing Charges: 2% + an additional $0.10 or $0.22 for every transaction
Distinguishing itself from other payment processor companies, Payment Depot employs a subscription pricing model based on a merchant’s month-on-month transaction volume. Merchants pay a flat fee per transaction along with the interchange rate, irrespective of the transaction type.
Notably, Payment Depot doesn’t impose hidden fees or cancellations and ensures swift access to funds within 48 hours of a transaction. The company offers various card readers, terminals, and POS systems, complemented by 24/7 customer support.
Pros: Significant savings for merchants in fees Top-notch customer care and support Flexible month-to-month billing
Cons: Limited hardware options Relatively costly for businesses with lower transaction volumes
8. Clover
Pricing: $14.95 monthly
Processing Charges: 2.6% + $0.10 for every transaction
Clover stands out as one of the premier payment gateways for small, brick-and-mortar businesses due to its user-friendly interface suitable for non-technical users. Its features encompass reporting tools for aggregated sales across multiple locations, revenue tracking, end-of-the-day reports, sales tracking, and analysis of peak business hours. Clover facilitates rapid deposits, allowing access to sales transaction funds within minutes (with a 1% fee).
Additionally, it supports the creation of digital and physical gift cards and accepts payments via Google Pay, Apple Pay, PayPal, and Venmo.
Pros: Well-structured and transparent pricing plans Comprehensive feature set, including tracking, loyalty programs, and order management. Acceptance of a wide variety of payment methods
Cons: Longer learning curve for users with limited technical expertise
9. Adyen
Pricing: Free
Processing Charges: $0.13 plus different interchange
Adyen stands as an international payment processor facilitating transactions across diverse payment channels, such as in-app orders with in-person pickup, self-scan and pay, in-store purchases, home shipping, QR code payments, and self-service kiosks.
For businesses in the US, Adyen imposes a $0.13 processing fee along with a variable interchange fee determined by the customer’s payment method. Interchange typically ranges between 2% to 4%, varying based on the chosen payment method. As a global processor, Adyen supports nearly every card or payment platform, including Alipay, Affirm, Apple Pay, Amazon Pay, Diners Club, and Cash App Pay.
Pros: Zero setup or monthly charges Round-the-clock mobile support A comprehensive knowledge base available on its site
Cons: Requires two months’ written notice for contract termination Minimum sales volume requirement of $120 Not as user-friendly for individuals without a technical background
10. Helcim:
Pricing: Free
Processing Charges: 1.92% + an additional $0.8 for every transaction
Helcim is renowned for its cost-effective payment gateway, offering an array of features, including invoice creation, subscription setup, and international payment processing. The platform provides numerous APIs, enabling customization of the payment gateway to align with specific business needs.
For businesses with high transaction volumes, Helcim offers automatic volume discounts, eliminating the need to contact their sales team for negotiation.
Pros: Zero monthly charges—transaction fees only Below the average rates for processing payments No need of long contracts, you can pay as you go API allows for extensive customization
Cons: Flat charges of $10 monthly for instant deposits Additional cost associated for hardware
Conclusion
Selecting the right payment gateway is a pivotal decision for any online business, influencing both customer satisfaction and financial outcomes. Evaluating factors such as cost, features, and supported payment methods is crucial. Among the top 10 payment gateways in 2024, each option offers unique advantages and considerations.
Whether it’s the cost-effective model of Helcim, the user-friendly interface of Clover, or the international capabilities of Adyen, understanding your business needs is key. Ultimately, a well-informed choice ensures not only smooth transactions but also sets the foundation for sustained growth and success in the competitive online marketplace.
The holiday shopping season for 2023 has officially arrived. Brands and retailers are busy and actively involved in their marketing strategies. They are making sure to have inventory and aligning their resources for a great quarter ahead and a joyous holiday season. Plans are in place for wholesale, dropship, marketplaces, and social initiatives, creating a great atmosphere for the festivities.
Taking insights from the figures for 2022, retailers and brands have plenty of reasons to feel positive about the approaching holiday season. Projections indicate that retail sales will surpass $1.6 trillion by 2027, which is more than phenomenal.
However, the current economic landscape brings some uncertainty to this year’s quarter due to factors like macroeconomics, inflation rates, job market conditions and high-interest rates. There is anticipation among industry observers as they await to see how consumers will navigate these challenges while approaching their holiday shopping. Let us understand the holiday shopping trends in 2023 and how inflation and supply chain problems will impact these 2023 holiday shopping trends.
Source: Statista – Monthly inflation rate in the US
The Impact Of Inflation On Item Prices This Year
The holiday shopping season is starting this year and many consumers are taking advantage of discounted prices to get a head start on their gift purchases. As we approach the holidays, numerous retailers have already reduced prices on a range of products, including electronics and clothing.
The potential impact of rising costs on holiday shopping is something to consider this year on the holiday shopping trends. For example, TV prices have dropped by 9.4% compared to the year. However, overall there has been an inflation rate of around 3.2% higher than the year before for goods. These numbers fall within a range so analysts are expressing skepticism about any major effects this year.
The 2023 holiday shopping season is expected to resemble pandemic years in terms of consumer behavior, with more people choosing to buy gifts in physical stores rather than online. Retailers are also better prepared to manage their inventory levels. And, of course, there are pressures that contribute to rising prices for goods.
Experts anticipate a subdued holiday season, with things returning to a more usual state after a surge in spending during the height of the pandemic. Over the decade (2010 to 2019), holiday spending experienced a yearly growth rate of 3.6%. In 2020 spending exceeded that of 2019 by 9.1%. This was further surpassed by another 12.7% in 2021. However, reports suggest that this year we can expect spending with an overall increase projected at around 3 4%.
Rising inflation in sectors, such as grocery prices, may impact people’s incomes. It may potentially lead to cutbacks in holiday shopping.
Budget Adjustment By Consumers
Consumers might be adjusting their budgets to accommodate prices, which could result in controlled spending. According to McKinsey reports 79% of consumers are making more budgetary choices this year. In response to holiday shopping trends, companies are placing emphasis on offering holiday promotions. Walmart, for example, has lowered prices on gift items. They also assured customers that their Thanksgiving meals would be more affordable compared to the year prior. Target plans to provide over two-thirds of its toys at prices below $25.
Retailers Anticipate Supply Chain Difficulties by 2023
Consumer goods and retail companies (CPR) are preparing themselves for head-on difficulties in their supply chains during this holiday season. According to a recent report, 42% of these companies anticipate facing stockouts or product shortages and 75%1 are finding local source to fight the anticipated stockout1.
Moreover, there is an expectation of delays in delivering products to customers due to import delays by 38%2 of companies. Alongside this, 35% foresee labor shortages as well. Various challenges faced by supply chains include factors like inflation, geopolitical tensions, dependency on countries for components, fluctuating freight rates, and port congestion will certainly impact the holiday shopping trends this year.
Geopolitical Issues
Geopolitical issues are also impacting the holiday shopping trends this year. Especially costs and efficiency of supply chains for 77% of consumer goods and retail organizations are the worst impacted. As a result, many companies are giving importance to nearshoring and domestic sourcing options as they strive to balance cost-effectiveness with resilience. These changes, coupled with increases in shipping rates, have forced manufacturers to make tough decisions about what products they can transport. Consequently, consumers may experience a reduced variety of choices on store shelves.
So, what does all this mean for consumers? It is advisable not to leave your holiday shopping until the minute. In fact, it would be wise to complete the majority of your shopping before December if possible.
Retailers Ready To Face The Challenges And To Overcome It!
In the face of escalating inflation, surging costs, and uncertainties in the labor market, consumers are strategically optimizing their purchasing power. A staggering 89% of global consumers actively seek better value, and they are finding their preferred options in marketplaces and dropship businesses, which experienced an impressive 38% growth in 2022.
Furthermore, retailers and brands on a global scale are actively expanding their presence on marketplaces, with over 60% planning to diversify across channels in the coming year to address the challenges they face.
For brands, it translates to increased exposure to potential new customers, while retailers are seizing the opportunity to expand their product offerings, reach new customer segments, and boost the Average Order Value (AOV). Marketplaces have emerged as leaders in this new era of commerce, providing value-conscious shoppers with the diverse choices they desire.
Top Holiday Shopping Trends And Insights To Look Out For In 2023
1. The Prominence of AI Will Shine
The prominence of Generative AI and other models is a major highlight in this year’s discussions, and these tools are becoming increasingly mainstream. Research indicates that 17%3 of consumers have utilized GPT for inspiration and product research, with an additional 10% expressing the likelihood of using it to curate their holiday shopping lists.
Predictive AI has already played a crucial role in enhancing the shopping experience online. Product recommendations generated by AI have been a staple for digital marketers and ecommerce merchants, providing consumers with suggestions on product detail pages, in shopping carts, and beyond.
This holiday season, brands and retailers are expected to embrace this technology, leveraging customer data to prepare more personalized and better shopping experiences that add value and loyalty. The notable impacts will be observed in:
Marketing: Automation of marketing campaigns and generating content for landing pages, emails, social media, text messages, and other applications.
Commerce: Introduction of conversational site search for a more natural and human approach to discovering the perfect gift across various digital touchpoints.
Service: Development of more human-like and nuanced chatbot responses capable of deeply anticipating, addressing, and understanding user queries.
2. Strong Pull to Home Products
Consumers are currently placing a strong emphasis on home products and services. The extended period of time spent at home over the last three years has significantly influenced the types of gifts people are planning to purchase. A notable 64%4 of shoppers intend to buy home products, such as coffee makers, vacuums, as well as electric toothbrushes, as gifts for the upcoming holiday season.
3. BNPL to be the Hero of Festive Season?
‘Buy Now, Pay Later‘ shopping apps are becoming increasingly popular, offering consumers additional flexibility in their purchasing choices. Services like Klarna, Affirm, Apple Pay Later, and Afterpay, alongside standard payment options, are now featured on various online merchant sites, and their popularity is expected to rise.
Here’s how they typically work: When customers opt for these platforms during checkout, their total order amount is divided into easy installments (which are usually 4 or 6). The first installment is levied during purchase, while the balance is automatically charged every other week after. Many of these platforms have simple terms, don’t impose interest charges, and skip credit checks – features that appeal to consumers. The ability to pay off the “debt” in few easy EMIs adds to the appeal.
Retailers also stand to benefit from these payment plans. They not only encourage customers to make more purchases but also facilitate the acquisition of high-priced items that might have been otherwise out of reach. Additionally, retailers experience fewer instances of shopping cart desertion and reduced returns for items bought through ‘Pay Later’ services.
However, consumers should be mindful of the potential drawbacks. While these services offer convenience, they may lead to higher spending. Falling behind on payments is a risk, and as users become accustomed to these installments, the introduction of interest fees in the future is a possibility. It’s essential for shoppers to weigh the benefits and risks before embracing ‘Buy Now, Pay Later’ options.
4. BOPIS to Contribute Highly this Festive Season
This in-store pickup option has become a significant driver of additional purchases in the physical store. This option gained popularity in 2020 and has since become a crucial aspect of the shopping experience. Studies show that consumers’ decisions about which retailers to shop at are greatly influenced by BOPIS, with 39% of consumers actively looking for stores that provide this service.
The effect on sales is also noteworthy, as 41% of consumers say they are more likely to buy something after looking online for products that are available in physical stores than they were a year ago. The trend toward omnichannel purchasing emphasizes how crucial comfort and access are to retaining customers. One out of every five online orders during the prior festive shopping season was fulfilled through BOPIS; after shipping deadline dates, this percentage increased to more than one in three.
However, implementing BOPIS successfully can be complex. Stores need to adopt new training programs, processes, metrics, and incentives to scale it profitably. The use of tools that enable seamless execution becomes crucial in maintaining a balance between streamlined operations, high customer satisfaction, and positive associate morale.
5. Both Online and In-Store Business Will See Growth
Offering customers the flexibility to choose between online and in-person shopping, especially if you have a physical store, is a smart strategy. This approach caters to their preferences in how and when they want to shop. The key, however, lies in ensuring a consistent experience, whether customers are shopping online or visiting your brick-and-mortar location.
An integrated shopping experience ensures that inventory information is transparent and promotions align seamlessly both online and offline. This means that when a customer wants to physically examine a product before making a purchase or assess the color options in-store, they can do so with confidence, knowing the item’s availability.
For those concerned about package theft or residing in multifamily housing, ordering online and opting for in-store pickup can offer added convenience. It’s crucial to provide a cohesive experience, regardless of where the consumer chooses to shop and their preferences for a particular purchase.
6. Addressing the Impact of Inflation on Consumer Spending
The economic challenges of recent years have placed a strain on consumers’ finances, with many households acknowledging the influence of inflation on their holiday budgets. Consequently, individuals are actively seeking the best opportunities for savings to mitigate the effects of inflation on their seasonal expenses. Some may opt to trim down their shopping lists, aiming to make more prudent purchases.
In response to this consumer sentiment, retailers are adapting their strategies by adjusting inventory, focusing on more budget-friendly options, and strategically pricing products to align with customers’ financial constraints.
However, it’s crucial for businesses to approach discount planning with precision. Careful consideration is needed to avoid potential pitfalls, such as losing profitability on sales or diminishing profit margins to an extent that could compromise the overall success of the holiday season. In essence, countering rising inflation’s impact requires a thoughtful approach to discounts and incentives, ensuring a balance that supports both consumer affordability and business sustainability.
7. Tailoring Special Deals for a Personal Touch
Just as customers receive personalized offers from various service providers, it’s only natural for them to anticipate personalized deals from your business during the holiday season. Enhancing the customer experience involves considering how to make these deals uniquely special based on individual preferences and interactions.
One approach is to craft deals that align with a customer’s past purchases, ensuring that advertisements highlight products related to their buying history. Alternatively, you can extend offers connected to items they have recently viewed or expressed interest in, creating a more tailored and relevant shopping experience.
The key to establishing a meaningful connection lies in the customization of offers. The more personalized the deal, the stronger the impression that your business is actively building a relationship with its customers. Leveraging data is crucial in achieving this level of customization, prompting potential investments in more advanced systems and tools to elevate your business’s intelligence and responsiveness.
8. Captivating Shoppers with Video Marketing
Harnessing the power of video ads can significantly influence a customer’s purchasing decision, adding a dynamic element to your holiday marketing strategy. Whether opting for a live stream or pre-recorded video as part of your social media content, the impact of effectively showcasing a product’s features and benefits during the holiday season can yield impressive results.
Video content proves particularly effective in capturing the attention of younger shoppers, with Gen Z highlighting its significant influence on their product choices. Surpassing other impactful factors, such as recommendations from friends or family or witnessing trusted individuals using the product, videos play a pivotal role in shaping purchasing decisions for this demographic.
To leverage this trend, consider creating suitable videos tailored for social media platforms or collaborating with influencers to generate engaging video content. Initiating contests that encourage users to share their own videos featuring your products can also result in valuable user-generated content, enhancing your brand’s visibility and engagement.
Conclusion
In 2023, as we move through the challenging terrain of holiday shopping trends, it is clear that there exists a fine balance between different economic variables, such as costs, consumers’ purchasing decisions, and industry changes. In order to curb up inflation, retailers have strategically adopted early discounts as well as value-based promotions in anticipation of its effect on prices. Consumers are being forced to rush to finish purchasing before supply chain threats take over and force them to wait longer than usual before buying for Christmas.
Despite the numerous uncertainties in the industry, technology, including AI, is becoming fundamental to many retailers to improve customers’ shopping experiences. While inflation will have an effect on consumer expenditure in companies, a smart approach to discounts and tailored discounts comes up as a critical step.
This complex mix of factors involves agile and flexible retailers who will probably surmount during the festive season.
Frequently Asked Questions
Q: How Do Holidays Impact the Supply Chain?
The holiday season can impact the supply chain due to various factors, including stringent stock control measures and challenges in handling shipping issues, especially during the final stages of delivery—the crucial last mile.
Q: What’s the Christmas Shopping Outlook for 2023?
Anticipated holiday shopping trends for 2023 indicate that consumers plan to spend a similar amount as in 2022 but on fewer gifts. The total planned expenditure is slightly higher than the 2022 levels by one percentage point, while the expected number of items to be purchased is four percentage points lower than the previous year.
Q: What Are the Holiday Sales Predictions?
While holiday shoppers are expected to increase spending, their focus on value and desire for deals might temper overall growth, bringing it back to pre-pandemic levels, according to the National Retail Federation. The major trade group forecasts a 3% to 4% year-over-year increase in sales for November and December.
Q: Why Could the Supply Chain Crisis Impact Your Holiday Shopping?
The ongoing supply chain crisis may disrupt last-minute holiday shopping plans, forcing buyers to resort to traditional methods this season. The combination of high demand, supply chain delays, material shortages, and challenges in hiring workers is reducing the availability of items both online and in physical stores.
With the evolution of the payment processing industry, merchants and consumers regularly come across multiple ways to process payments for a purchase. From credit cards to NFC payments and fast online transactions to monthly installments, users enjoy a variety of payment options at their convenience. BNPL is no exception. It is one of the many financing solutions that several renowned financial service companies offer for users to purchase a product and pay for it later within set intervals.
There are many different types of BNPL payments; it all comes down to individual preferences and requirements. Users can choose between an installment plan with interest or without interest. The length of the installments varies for different service providers. Pay-in-4 is a loan installment plan with four intervals. This article will discuss how Pay-in-4 is equally popular among customers as any other payment form and is sometimes even more favored than credit cards.
What is Pay-in-4?
Pay-in-4 is a highly preferred buy now, pay later service, in which a payment is split into four equal installments, generally without a high-interest rate. Today, many reliable companies offer this service to make it easier for buyers to pay for the items they typically can’t afford. If we talk about the statistics, one out of every 5 BNPL users chooses pay-in-4 as their preferred mode of payment, compared to debit, credit, or cash payments.
In this mode of payment, users pay the first installment at the time of purchase, and the rest of the dues are payable every two weeks. According to surveys, almost half of the users opt for pay-in-4 for their purchase, and over 69% of customers indicate the need for BNPL service in their area. It implies that current generations highly demand BNPL services to be more accessible.
BNPL is also one of the commonly mentioned reasons for higher sales and reduced costs by many retailers in the U.S. In short, BNPL directly benefits buyers and sellers, and pay-in-4 comes at the top of the list of favored BNPL services.
Pay-in-4 by Afterpay
Afterpay is a financial technology company offering payment processing solutions to customers in Australia, the United States, the United Kingdom, Canada, and New Zealand. The company facilitates BNPL and comes under the list of top-picked providers for pay-in-4 payment services. Reports reflect that two in every five U.S. users trust Afterpay for its BNPL offerings. In the debate over credit cards vs. pay-in-4, almost half of U.S. consumers choose the latter as their desired payment method.
With Afterpay, you can keep a close eye on your spending and budget your purchases. Its pay-in-4 interest-free installment plan is designed to enhance customers’ financial health and allow them to earn rewards while shopping.
As an Afterpay user, you can manage your finances while buying whatever you need. Can it get any better? With the release of an app, users can discover thousands of popular, global brands only with a tap and enjoy secure loan installments to pay for their favorite items. If you are concerned about missing your payments, Afterpay sends regular reminders to help you be on top of your dues.
Credit Cards vs. Pay-in-4
In today’s modern world, merchants are advantaged to offer more than one way to process payments. As a result, customers are free to choose a convenient payment method. In the last couple of years, the buy now, pay later service has gained much recognition. Many popular payment processing companies are acknowledging the fast-growing demand.
Source: Statista – BNPL popularity growing in different generations of people
Even though credit cards are notably the most used mode of payment for in-store and online shopping, the BNPL payment plan is receiving equal online traction. Now, it’s true that some differences between these services have long since blurred; many credit card companies provide pay-over-time installment plans, and some BNPL service provides grant virtual and physical cards. Yet, there are still some distinct qualities restricted to each payment method.
If you aren’t sure what payment method is better for your personal or business usage, here are some main differences between credit cards and BNPL services:
Account Opening
To use a credit card, you need to apply for and open an account with a bank. The requirements for opening and using an account vary for each card issuer. Your credit score, monthly bills, and income are some of the many factors that can come in the way of opening a credit card account.
As for the buy now, pay later facility, you can either open an account before making a purchase or request it at checkout. Most pay-in-4 services do not require a hard credit check and are accessible (sometimes) even if you have a bad credit score.
Availability
Even though most popular credit card networks such as MasterCard, Visa, or Discover are widely used, some stores may not accept all credit card brands. Similarly, some stores may not offer the buy now, pay later service. Moreover, your ability to use pay-in-4 depends on where you shop, what you buy, and how much money you need. However, most BNPL providers have debit cards that can be used at any store that accepts the card network.
Loan Payment
If we talk about credit cards vs. pay-in-4 in terms of their installment plans, most credit card companies allow users to pay off one part of their balance and pay the rest in the next month. The minimum dues payable depends on your total balance; a percentage of your total balance will be deducted. Some companies may even fix an amount. The time it will take to pay off your balance depends on your minimum payments.
In the pay-in-4 BNPL service, the total amount is split into four equal parts. One part is paid at the time of purchase, while the rest is paid in six weeks. Some BNPL providers offer extended installment plans.
Fees and Interest Rate
It isn’t a secret that credit cards have a high interest rates. And they can charge late payment fees and annual fees. If you are lucky, your credit card might have a grace period that allows users to avoid interest by paying the credit card bill in full. On the other hand, if you fail to pay the bill in full when it is due, the interest can add up daily.
Most buy now, pay later services do not charge fees, and generally, pay-in-4 plans are interest-free. However, some providers do charge late fees. Loan installment plans besides the pay-in-4 one could have varying interest charges.
Ease of Access
Most short-term BNPL plans are easily accessible because of their high approval rate. This mode of payment is suitable for people with a low credit score and inadequate credit history. This service is highly recommended if you have faced trouble getting approved for a traditional credit card for any particular reason.
Contrarily, credit card loans are hard to get approved. There is a high chance of application rejection if you have a low credit score. For that reason, most people aged between 18-21 choose the buy now, pay later service when it comes to credit cards vs. pay-in-4.
Credit Impact
A hard inquiry is performed when you apply for a credit card loan. Your repayment and burrowing information is provided to credit bureaus. It means you can earn a good credit score by paying your credit card bill on time and keeping a low debt amount. However, missing payments and high credit card debt can lead to a bad credit score.
Since most BNPL service providers do a soft inquiry and do not report your details to credit bureaus, you can build a good credit score. However, some buy now, pay later providers will report you to credit bureaus if you fail to repay the debt.
Why do BNPL Users Prefer Pay-in-4?
Younger generations prefer Pay-in-4 instead of credit cards, and around 62% of customers use BNPL services once a month. According to most users, the buy now, pay later facility frees them from the stress of hefty expenses. It helps them spread the costs and manage their financial situation, especially during the holiday season. 60% of BNPL users have indicated that the pay-in-4 plan is a reliable alternative to high-interest credit card loans.
The convenience of set payments and reduced financial stress make BNPL the best option for most customers. With credit cards, users must pay a part of the total payment by the month’s end. In the case of buy now, pay later, you have multiple ways to clear your debt. The pay-in-4 plan gives you much control over your payments and allows you to manage your spending. It is also more pocket-friendly than credit cards, as most BNPL providers are very upfront about the payment plan and costs.
Why are Credit Card Loans Less Popular Among BNPL Users?
Even though credit cards are the most frequently used mode of payment, they can be ridiculously expensive for some users. It is definitely a big no for people with a low credit score. Credit card loans are becoming less popular among BNPL users because of their strict terms and conditions. The risk of getting caught up in heavy debt and the tedious loan approval process are two of the most common reasons for younger consumers to opt for BNPL payment plans.
The rising interest rate prevents many users from meeting the minimum payment requirement, and the number of people turning to the pay-in-4 payment structure has significantly increased. The late payment fee and many other usage-based charges can come in the way of your financial stability. The impact of delayed payments can be extensive and likely to cost you your credit score.
Is BNPL Surpassing Credit Cards?
Even though not everyone uses BNPL services (many merchants solely work with credit cards), the demand for pay-in-4 payment services is increasing day by day. Many consumers believe they would want to use the buy now, pay later payment plan if it is more widely accessible.
Paying for an expensive product on the spot is no doubt less convenient than taking out a small amount every two weeks to cover that cost. The ability to plan your budget and buy your desired things without straining your financial situation is the best perk of a BNPL plan.
However, it comes with a cost for some consumers. Even though more than half of consumers are leaning towards pay-in-4, they have not stopped using credit cards entirely. Saying that BNPL has replaced credit cards would be an overstatement. Nevertheless, its fan base is rapidly expanding.
Conclusion
Each payment plan has its perks and shortcomings, and pay-in-4 is not an exception; it is not suitable for all kinds of purchases. With that said, BNPL is becoming a top pick among users who prefer to split their budget over weeks and plan their spending accordingly. Unlike credit cards, the buy now, pay later option offers more transparency about how long it will take them to pay off the debt.
Some users switch between both facilities depending on their shopping. It indicates that the conclusion to the credit cards vs. pay-in-4 debate isn’t the same for everyone. While some consumers solely rely on credit cards, some prefer BNPL. It all comes down to individual needs. The BNPL service is best suited for short-term budgeting and large purchases. Over 60% of users acknowledge that the pay-in-4 plan comes with the ease of set payments and offers convenience.
The bottom line is that most shoppers look for more convenience at checkout. They look for flexible options to pay for their purchases and the easiest ways to cover their debts on time. BNPL gives them that. Even though most credit card service providers offer the option to pay in installments, these installments come with hefty interest rates.
With pay-in-4, users can receive micro-loans to divide an expensive purchase into equal parts with little to no interest. As a result, people are shifting their preferences, and their need to depend entirely on credit cards is decreasing.
Celebrating occasions, whether a festival, an event, a birthday, or any moment of joy, is truly wonderful. What adds to the magic is when you accompany it with a gift. Traditionally, gifts were limited to close friends, family members, or relatives, making gifts a special and personalized thing. With changing trends and technology integration, gifting has become more frequent, including in the business world. It is a great way to appreciate your employees to boost their energy and confidence in the company. So here is a list of the best gift cards for employees in 2024 that you can use to boost their productivity and enthusiasm.
Nowadays, where one click can help solve the most difficult problems, gifting has also been made easy with Gift cards, it allows a high level of personalization straight to every division and employee. This can truly bring joy to your workforce. Gift cards empower individuals to choose what they truly desire from a store, ensuring that they feel content and satisfied with their chosen purchase. If you’re looking for gifting ideas, for your company employees explore a range of gift card options designed meticulously below.
Top 10 Gift Cards For Employees & Incentives Platforms/Services
Employee gift card platforms simplify how we show appreciation and recognize their efforts by making it easier, more convenient, and more spontaneous.
1. Motivosity
Motivosity is transforming the corporate gift card for employees with its ThanksMatters Card. This exceptional gift card offers a range of redemption options at approved merchants enabling employees to enjoy a global reward experience. What sets it apart is the availability of funds giving employees the freedom to decide when and how they want to use their rewards.
Motivosity empowers employees by allowing them to personalize their rewards according to their preferences. Whether it’s treating themselves to a cup of coffee, filling up their gas tank for their commute, or even splurging on an exciting new surfboard. This level of personalization makes this gift card a meaningful token of appreciation that enhances the overall employee journey.
How does Motivosity stand out?
Easily Accessible: Accessibility through phones, desktops, and work-related apps like Teams/Slack
All-in-one Platform: A unified platform that integrates gifts, employee engagement, recognition, and more
Built-in reporting: Built-in reporting offers insights into potential attrition, most recognized employees, managers in need of coaching, and more.
2. Bonusly
Other than the rewards and acknowledgments Bonusly offers a special feature that enables employees to exchange top-notch gift cards with their employees. Every month each manager or department head receives an allowance to send bonuses as a gesture of gratitude for their employees’ contributions.
Bonusly promotes transparency through a bonus feed where everyone can see who received rewards with the note behind what they did well this month.
How does Bonusly stand out?
P2P acknowledgment: Effortless recognition of contributions from one colleague to another.
Automated celebratory moments: Streamlined automation of gifts for important occasions such as birthdays and work anniversaries.
Incentive initiatives: Nurturing a positive workplace culture through incentivized programs.
Variety in rewards: Employees can choose from a diverse range of rewards, including gift cards, charitable donations, cash, or company swag.
3. PerkUp
PerkUp provides a convenient and diverse employee rewards program that eliminates the need for complicated points systems. With PerkUp you can easily reward your staff with gifts they truly desire.
Getting started with PerkUp is a breeze – you can simply fill the Visa cards with specific dollar amounts. This empowers your employees to select products, services or experiences that align with their preferences. Alternatively, they can choose Visa gift cards that are accepted globally, which can be a great way to show appreciation to employees working from different countries (e.g., Virtual Assistants).
The efficiency of these gift cards ensures that sending and redeeming rewards is quick, secure and convenient.
How does PerkUp stand out?
Extensive Range of Options: Choose from a wide array of gift cards and products, ranging from simple treats to high-end tech and enriching experiences, catering to almost every occasion.
Premium Company-Branded Swag: Boost company loyalty and make recipients feel valued with premium, company-branded swag.
Company Swag Store: PerkUp allows you to open your own company swag store.
Customizable Themes: Engage employees while maintaining company culture through customizable themes.
4. Bucketlist
Bucketlist is an employee gift and rewards program that focuses on providing recognition to cater to the specific needs of each employee. Bucketlist enables employees to earn points that can be used towards achieving their personal life goals.
This platform places an emphasis on each employee, avoiding a one-size-fits-all approach. Through Bucketlists employee gift cards, individuals have the opportunity to explore, claim, and even share high-quality items, experiences, and rewards. This ensures that they can fulfill aspirations from their bucket list.
How does Bucketlist stand out?
Customizable Rewards: Tailor rewards to align with your company values, ensuring a personalized touch.
Extensive Range of Gift Cards: Choose from a vast array of gift cards to offer diverse options to your employees.
Effortless Onboarding: Simplify the process with easy onboarding, allowing employees to make use of the program instantly.
5. NectarHR
NectarHR truly stands out as a P2P recognition platform fostering an environment where team members can freely express appreciation for one another’s contributions and come together to celebrate occasions across all divisions of the company. Unlike other systems, NectarHR promotes inclusivity by actively encouraging every team member to participate.
With integration with Amazon, NectarHR empowers employees by giving them the freedom to choose their gifts across the platforms, including third-party companies. The platform provides a range of options, including a catalog of gift card opportunities and customizable rewards tailored specifically to individual preferences.
How does NectarHR stand out?
User-Friendly Interface: Nectar HR offers a user interface that’s simple to navigate and understand.
Diverse Range of Gifting Options: You have a range of gifting options to choose from, such as gift cards from Amazon, charitable donations, branded merchandise, personalized rewards, and more.
Extensive Integration Capabilities: Nectar HR effortlessly integrates with your business software making the gifting process more efficient and streamlined.
6. Guusto
Guusto offers you the opportunity to gradually implement a reward and incentive program. You can start by introducing a pilot program tailored for your managers and providing the rewards.
Image source: Guusto
Once the pilot program receives good feedback, you can then move forward with implementing a plan for your entire organization. Guusto is particularly effective in assisting managers in understanding their team’s dynamics recognizing accomplishments and showing gratitude towards team members.
How does Guusto stand out?
Easy to Integrate with Your Employee Datalog: Begin sending or scheduling rewards within minutes, not months.
Good Adaptability: Real-time recognition, providing individuals with something they genuinely desire.
Value for Money: No setup fees, shipping fees, markups, and unclaimed gift cards are entirely refunded.
7. Connecteam
Connecteam stands out as one of the top all-in-one gift card platforms for employees. Its versatility as a rewards app provides a wide array of gift card options for employees to choose from. The platform allows you to acknowledge and reward employees for both minor and major accomplishments through their token system.
Individuals with the necessary privileges can use tokens to recognize employees for completing tasks, excelling in their roles, or going above and beyond expectations. For instance, employees can earn tokens for finishing assigned training or as a bonus for their work anniversary. The earned tokens can then be utilized to purchase gift cards of their choice. The token system ensures flexibility, allowing employees to acquire gift cards aligned with the price points of various vendors.
How does Connecteam stand out?
Different Programs: Recognition for a diverse range of achievements suitable for any milestone to any festivities or any celebrations like Birthdays or Anniversaries.
Token-Based Gifts: Token-based system for employees to shop for gift cards. It also encourages the employees to do more.
Various Vendors to Choose From: Inclusion of gift cards from popular vendors on the platform
8. Giftcards.com
Giftcards.com provides an extensive and diverse range of gift cards, showcasing numerous well-known brands and retailers. This ensures a perfect match for every employee’s unique taste and preference.
Personalization is a key feature of Giftcards.com, offering personalized gift cards and custom greetings. This enables employers to add a personal touch to their recognition efforts, strengthening the connection between the company and its valued employees. Additionally, Giftcards.com streamlines the bulk purchase of gift cards through its user-friendly platform, ensuring a smooth and efficient experience, from selecting the right gift cards to distributing them to employees.
How does Giftcards.com stand out?
Choose a design: Pick from over 15,000 designs for any occasion.
Create your card: Upload a photo to craft a memorable gift.
Create a business card: Upload an image to represent your small business.
9. Stadium
Stadium offers a diverse selection of gift cards spanning various categories such as entertainment, dining, travel, shopping, and wellness. This broad range ensures that every employee can find the perfect gift card, whether they’re craving a culinary adventure, seeking entertainment options, or focusing on wellness.
Addressing various gifting needs, Stadium’s curated selection is suitable for holiday gifts, employee incentives, or wellness rewards. This versatility empowers employers to align their recognition efforts with the unique preferences and goals of their workforce.
How does Stadium stand out?
Gift With Points: Emphasizing thoughtfulness, a points-based system allows you to conceal the cost of items.
Dozens Of Templates: Choose from a variety of templates tailored to your specific use case and occasion. All templates are fully customizable.
Quick Setup: Each shop is pre-loaded with a catalog of swag, snacks, and more, ensuring a speedy setup.
Weekly Payouts: Rewards points are disbursed on a weekly basis based on the number of boxes shipped to recipients.
10. Terryberry
Terryberry is dedicated to assisting companies worldwide in supporting their valuable employees through the effectiveness of employee rewards. Their service empowers managers and team leaders to craft a personalized employee incentive and awards program, delivering gift cards and a variety of rewards to employees.
Operating with renowned brands, Terryberry runs a reward platform that provides a diverse selection of merchandise catering to every lifestyle. This ensures that, when the time comes to choose the perfect employee gift, Terryberry can make it a reality.
What sets this employee gift card program apart is Terryberry’s seamless integration of rewards and incentives into existing health and wellness programs. This encourages employees to attain their fitness goals, prioritize mental well-being, and find opportunities to relax and recharge.
How does Terryberry stand out?
Compatibility with almost all reward programs: Service and Milestone Awards, Incentive and Performance Rewards, Business gifts, and Corporate Wellness gifts.
Excellent Features: Features like DreamTracker allow reward recipients to set goals for specific items of their choice and monitor progress through the application.
Various Choice of Awards: Terryberry’s new redemption platform facilitates organizations in offering thousands of award options from leading brands like Dyson, Tag Heuer, and Kate Spade.
Best Gift Cards For Employees: 12 Most Popular Ideas In 2024
Here are some preferred types of employee gift cards based on their preferences and habits:
1. Visa Gift Cards
The Visa Gift Card serves as a prepaid Visa card, allowing for purchases at merchants worldwide that accept Visa Debit Cards. The card’s value is loaded at the time of purchase, and your spending is confined to the amount placed on the card by the purchaser.
Think of it as the equivalent of placing cash in an envelope—minus the actual cash. A versatile card like this Visa offering serves as a foolproof choice for gifting, whether it’s a last-minute decision or a pre-planned gesture. You can be confident that your gift will contribute to the recipient’s preferences, whatever they may choose.
2. Amazon Gift Cards
Amazon gift cards stand out as an excellent choice for rewarding employees or customers. They offer flexibility, allowing recipients to use them for purchasing products on the Amazon website, at Amazon retail stores, or even at third-party retailers. Additionally, these cards can be redeemed for cash at numerous locations across the United States that accept US dollar cash. Available in various denominations, Amazon gift cards are swiftly delivered via email upon purchase and within minutes after redemption online or in-store.
They are accessible in different denominations ranging from $1 to $500, providing versatility for purchasing items in the Amazon store or at other retailers.
3. Uber Gift Cards
Uber gift cards are an ideal choice for bestowing the gift of boundless possibilities. Whether it’s a spur-of-the-moment present or a considerate gesture, the Uber gift card provides adaptability and convenience for any occasion.
When you purchase Uber credit for your employees, they have the freedom to use it as they wish. Once redeemed, the Uber gift card is credited to your Uber Cash or Uber credits balance, applicable during checkout on Uber or Uber Eats. When finalizing transactions on Uber cabs or Uber Eats, your Uber credits or cash balance is typically automatically selected as the primary payment method. It’s important to note that each Uber account has a maximum limit of $500 for the total gift card value.
4. DoorDash Gift Cards
These gift cards offer the flexibility of being used at the recipient’s preferred restaurant, ranging from high-end dining to fast food. DoorDash for Work’s gift cards presents a versatile solution that caters to everyone’s preferences. An added benefit is that DoorDash Employee Gift Cards never expire, providing your employees the freedom to use them at their convenience.
Once the gift card is acknowledged, the balance is seamlessly added to the employee’s account, automatically applying to their subsequent purchase. With a DoorDash gift card linked to their account, employees have the liberty to use it for various purposes—whether it’s their next restaurant meal, grocery shopping, or making purchases at a supermarket.
5. Nike Gift Cards
Nike stands as a premier athletic brand globally. With this popular brand, your employees will surely be encouraged to some extent. Comfort, essentially the new work uniform, is crucial in the modern workplace’s demanding atmosphere. As mental athletes juggle tasks, Nike ensures they stay fit and ready for the job.
Nike gift cards hold the same value as cash and can be utilized for purchases on Converse.com, Nike.com, the official Nike App, and at all Nike retail stores. These gift cards are available in both physical and digital formats.
6. Spotify Gift card
The Spotify Gift card emerges as a perfect present for your recipients, offering both value and enjoyable benefits. Let’s face it—people love music, and it has the remarkable power to alleviate fatigue and instantly uplift spirits.
Considering that many employees thrive while working to the beats of their favorite tunes, why not grant them access to a world of music? A Spotify Gift card could be the perfect gesture for an employee who’s always humming melodies at work, enhancing their work experience.
In essence, the Spotify gift card is an ideal choice for music enthusiasts, providing unlimited skips and uninterrupted music. Once your employees receive this gift card, they can easily redeem it on Spotify’s website or mobile app by entering the unique code. Voila – instant access to Spotify Premium benefits, including ad-free listening, unlimited skips, and offline listening. The gift card redemption ensures seamless streaming without the need for a credit card.
7. Airbnb Gift Cards
These cards stand out as fantastic gifts for adventure-seekers and travel enthusiasts in your office because what could be a better gift than new experiences? Airbnb gift cards open the door to booking stays in any Airbnb property worldwide. This means your loved ones can utilize the gift card to secure a cozy cabin in the woods, a luxurious beachfront villa, or a trendy city apartment for a weekend getaway.
For your employees to use these Gift Cards on their Airbnb account, they can simply visit the official Airbnb site and navigate to the gift section. Once added, the entire Gift Card value seamlessly transfers to and is displayed on your employee’s Airbnb account as their Gift Card balance. Importantly, this balance can only be redeemed for the purchase of goods and services offered on the Airbnb Platform.
8. H&M Gift Cards
Allow your recipients to explore a multitude of incredible clothing options by offering them H&M gift cards, redeemable on H&M’s online website or at hundreds of physical stores worldwide. Whether it’s for birthdays, end-of-year rewards, or simply to express gratitude for employee loyalty, H&M gift cards are the ideal choice.
Available in various denominations, these gift cards can be used for full or partial payment for any goods in H&M stores. When presented, the card’s amount is deducted, and any remaining balance is conveniently displayed on the receipt. While no change or refund is provided, the remaining balance can be applied to future purchases, ensuring a seamless and enjoyable shopping experience for your recipients.
9. B&N Gift Cards
Barnes & Noble Gift Cards make a great choice when it comes to rewarding your employees. They offer the best solution for those in your team who love books and enjoy reading. All orders qualify for UPS Ground delivery within a week. What’s more, if you choose eGift Cards, they can be delivered in minutes, ensuring a convenient process.
With around 9,000 bookstores across the country including 600 B&N stores, your employees will have plenty of opportunities to use their gift cards. They can redeem them at any B&N store or even at any B&N café. Additionally, they can also make purchases on the website or at bookseller locations of B. Dalton. This versatile gift card works like cash and can be used for a range of products.
A Barnes & Noble Gift Card is guaranteed to bring a smile to any employee who appreciates the world of books and pop culture.
10. Netflix Gift Cards
Netflix is widely recognized as the leading provider of on-demand internet streaming channels. With over 200 million subscribers across 190 countries, it’s safe to say that it offers a captivating experience. If you’re looking for various options, the Netflix gift card is an excellent choice as it provides a hassle-free and convenient payment method for subscribers.
One of the advantages of the Netflix gift card is that you don’t have to worry about your corporate gift recipient already having one. A single account can effortlessly use multiple cards allowing your staff to enjoy months of streaming.
Whether your employee is already a Netflix subscriber, the Netflix gift card makes for a good addition to their membership. The redemption process is straightforward. It doesn’t require any credit card information. Gift codes can be easily applied as a balance on their account, adding value to any plan they choose without any restrictions.
11. Alo Moves Gift Cards
Is yoga, meditation, or at-home fitness part of your employees’ well-being routine? Alo Moves brings them a world of yoga, mindfulness, fitness, and skill-building classes, available for streaming anytime, anywhere. With gift cards offering six-month and one-year subscriptions, you can effortlessly enhance your employees’ wellness journey. You can deliver this e-gift card directly to their inbox, sparing them the hassle of going to crowded stores.
Once they log in to the site, your employees can easily navigate to the dedicated redemption page for your gift card. There, they’ll find their name listed under “connected to.” Upon redemption, the gift card benefits will seamlessly apply at the conclusion of their current billing cycle.
12. Apple Gift Cards
These gift cards empower your employees to access an array of Apple features, including music, apps, TV shows, movies from the iTunes Store, and Apple eBooks. They can also make in-app purchases on the App Store or redeem their cards against iTunes Gifts. Streamline the joy on a global scale through the Incenti API, ensuring Apple Gift cards are delivered via email within minutes.
Apple Gift Cards are the ideal gesture for any occasion, recipient, or event. Whether rewarding employees or surprising customers with extra credit for their favorite mobile game, or contributing towards that coveted Macbook, this gift card provides excellent value for all Apple products. With denominations ranging from $5 to $10 Apple Gift Cards to higher values, your recipients can also choose how they redeem their Apple Gift Cards.
Understanding Gift Cards
While gift cards can be physically obtained and distributed, many companies opt for a virtual employee experience platform to streamline the process of acknowledging and rewarding employee performance. Top-notch employee gift card platforms enable you to establish a budget for employee rewards and allocate funds among coworkers or managers, depending on who will be presenting the rewards.
When an employee is acknowledged for their contributions, they receive money or points/tokens that carry a monetary value. Once an individual accumulates enough in their account, they can exchange it for a gift card. Typically digital, these gift cards are versatile and can be utilized in various stores.
What Are Considered As The Best Gift Cards?
Not all gift cards are created equal. Some types of these cards are more effective in terms of features and offerings.
In the market there are primarily two types of gift cards; open-loop and closed-loop cards. It’s important to understand the distinction between them. An example of an open-loop gift card is the American Express Gift Card. These cards are considered good as cash because they can be used to purchase anything you or your employee desires.
On the other hand, closed-loop gift cards can only be used at stores, outlets, or for designated services. Retail closed-loop cards like Target or Amazon gift cards fall into this category while experiential closed-loop cards include those for Southwest Airlines or Airbnb.
Many closed-loop cards prove to be a good choice when it comes to motivating employees through gift cards. While open-loop cards may be preferred by employees, closed-loop ones tend to be seen as impersonal and, therefore, more meaningful, especially by salaried employees.
Choosing Between Physical and Digital Gift Cards – A Brief Overview
When deciding between digital and physical cards, it’s crucial to understand the distinctions. Physical cards, being the traditional option, evoke a higher sense of emotion as they resemble a classic gift. However, their practicality diminishes, especially when urgency is a factor, as they can be challenging to deliver promptly.
Moreover, physical cards are prone to misplacement and deterioration, diminishing their longevity. Conversely, digital cards offer a global and straightforward solution. They are easily transmittable and immune to loss since they are retrievable.
While digital cards may lack the tangible ‘gift’ feel, they excel in convenience, a crucial factor in today’s remote work culture with dispersed employees. These cards, easily purchasable and accessible, offer a hassle-free means of crossing geographical boundaries. The recipient enjoys the flexibility of redeeming them either online or at offline physical stores, providing a blend of modernity, freedom of choice, and instant gratification.
4 Ways to Enhance the Effectiveness of Gift Cards
If you’ve chosen gift cards as the ideal employee reward, here are a few tips to maximize their impact.
Public Recognition:
Present the employee reward in person and in front of their peers. Utilize the opportunity to express gratitude for their exceptional work and highlight the benefits of the gift card as a recognition award.
Infuse a Personal Touch:
While your employees’ achievements contribute to the company’s success, recognizing individuals personally adds a valuable touch. The act of acknowledgment signifies approval from someone respected or admired.
When this recognition comes from their supervisor, it demonstrates the genuine care they have for their team. Deliver the gift card accompanied by a handwritten or customized note conveying congratulations and appreciation. Extend personal thanks to the reward recipient, fostering a sense of inspiration for even better performance in the future.
Public Advocacy:
Broadcast the employee and their accomplishment through any available and appropriate channels, both internally and externally. This could include the company website, notice boards, or even social media channels.
Use Open-Loop Gift Cards:
While closed-loop gift cards represent a standard reward option, open-loop gift cards offer a level of freedom that closed-loop cards lack. Moreover, open-loop cards are widely accepted by most brands, providing employees with a diverse array of choices.
Conclusion
Selecting the best gift cards for employees in 2024 involves careful consideration of their preferences and the company’s recognition goals. The evolving trends in gifting, especially in the corporate world, emphasize personalization and choice. Gift card platforms like Bonusly, PerkUp, Bucketlist, NectarHR, Motivosity, Guusto, Connecteam, Giftcards.com, Stadium, Terryberry, and others offer diverse options for recognizing and appreciating employees.
Each platform has unique features, such as P2P acknowledgment, customizable rewards, and seamless integration capabilities. The curated list of popular gift card ideas for 2023, including Visa, Amazon, Uber, DoorDash, Nike, Spotify, Airbnb, H&M, B&N, Netflix, Alo Moves, and Apple, provides a range of choices catering to different preferences and interests.
Understanding the distinctions between open-loop and closed-loop gift cards is crucial, with closed-loop cards often perceived as more meaningful. Additionally, the choice between physical and digital cards depends on factors like urgency, practicality, and the remote work culture.
To enhance the effectiveness of gift cards, public recognition, a personal touch, public advocacy, and the use of open-loop cards are recommended. Overall, the thoughtful selection and presentation of gift cards contribute to a positive employee experience, fostering motivation and engagement within the workforce.
Frequently Asked Questions
Q: What is a Gift Card for Employees?
Employee gift cards are a way to show appreciation and are often a part of a company’s rewards and recognition program.
Q: When is the Right Time to Give Gift Cards to Employees?
Gift cards can be given occasionally as part of employee recognition efforts or, as gifts during events and festivals.
Q: What are Some of the Best Online Gift Cards for Employees?
Gift card options are available, including prepaid cards and cards specifically designed for travel, entertainment, or even jewelry.
Q: How Do I Choose an Employee Gift Card?
Choosing the most suitable gift card involves considering factors such as company culture, the occasion, individual preferences, and budget limitations.
Amazon allows its card members to implement its BNPL (Buy Now Pay Later Scheme) across different retail platforms. The cards, which were earlier limited to Amazon, can now be used for shopping across all eligible sites. Amazon Pay installments option has helped the company grow its audience base by allowing people to shop from anywhere, anytime, and complete their payments in equal installments. If you are wondering what this scheme means for Amazon’s existing and new customers, plus how it will affect the company, keep reading.
On 15th August 2023, Chase and Amazon announced a partnership and an offering for Amazon Visa, as well as, Prime Visa members. According to their statement, the companies have enabled the card members to use the buy now pay later scheme outside Amazon and enjoy the perks of paying in installments for all their eligible purchases.
The director of Amazon Pay, Omar Soudodi, mentioned in a statement that the company has always aimed to make payment and shopping experiences hassle-free for its customers. They are always on the lookout for ways to offer a seamless payment experience so that customers do not have to stick to the limited options to complete their transactions. The decision to take this outside Amazon shows the dedication of the team in helping Amazon customers and those who prefer shopping outside the app and its website.
Amazon Pay Installments Scheme
Amazon Pay’s director said the team was excited to launch an option that allows Amazon and Prime Visa card members to divide their payment into six equal installments. The amount is also payable in 12 months at 0% interest, making it a super affordable and convenient option for customers who can’t afford luxurious items that require immediate payment. By offering convenience in payments, the director said Amazon has found a new way to reach more customers more easily.
The scheme enables buyers to use their cards to pay for their favorite products in equal installments across hundreds of thousands of retail stores. The eligibility requires customers to have either a Prime Visa or an Amazon Visa card. The order should be above $50 and they must shop at the store that qualifies for the scheme. A few examples of the popular retail stores where you can use these cards for BNPL are Authentic Watches, Tennis Express, Lenovo, and other stores where Visa is accepted.
Amazon’s and Chase’s collaboration for the scheme doesn’t come as a surprise, as the buy now pay later scheme is already gaining immense popularity all over the world and is seen as one of the most convenient ways to pay for your purchases at your convenient pace. With customers experiencing financial pressure, it’s obvious they will want a scheme that allows them to split their payments into equal installments, which are payable over a specific period. To understand how it works, let’s take a look at the brief overview of the Buy Now Pay Later scheme.
Buy Now Pay Later is exactly what the name suggests. The scheme allows people to buy their favorite products and pay for them in equal installments. The amount is payable in 4, 6, and 12 installments, depending on the purchase amount and where you are buying it from. The first installment must be paid right at the time of purchase and the remaining is payable on specific dates, as predetermined by the store.
The amount is debited to your cards or bank accounts, depending on the payment method you choose, and it’s deducted automatically until it is paid in full. Most of these plans are available at 0% interest, although they might cost you a fee and interest. Here’s how it works.
How Does BNPL Work? And Is It Effective?
At the time of checkout, you will see the BNPL option which enables you to pay a small amount of money at the checkout and the remaining in equal installments over a specific period. If you are interested in continuing, you will need to fill out a small application form, which requires your email, phone number, name, social security number, and basic IDs. Once done, you are supposed to submit a suitable payment method, which will either be accepted or rejected depending on your account balance and other factors, usually, the store owner runs a soft credit check before proceeding.
The question is does BNPL work for all kinds of purchases? While it’s a good idea to consider the plan for heavy and expensive purchases, like a computer and other stuff, it’s not a wise idea to use it for small items. Buy now pay later is still a kind of debt, even if that comes without fee or interest. You don’t want to take on unnecessary debt unless it’s absolutely important. That’s because late payments or missed payments can lead to fees, which can accumulate over time, making your purchase more expensive than it should be.
Due to the increasing popularity of the BNPL scheme, it’s become popular across different retail stores. Even the small stores are considering the scheme, as it gives customers the freedom and flexibility to make payments at their convenient pace. It encourages them to buy the items of their choice without any worries. Amazon has embraced the same concept at a time when BNPL’s popularity has reached new heights.
How Does the BNPL Scheme Benefit Amazon and its Customers?
Buy Now Pay Later isn’t just for customers, but it’s equally beneficial for Amazon. Below we are going to explore some common benefits of the scheme for both.
Benefits for Amazon
Increased Conversions: It’s difficult to convince people to buy expensive items without discounts and promotional deals. But, BNPL works wonders for those who can’t afford luxury items but are willing to buy them if they get to spread their payment over time. By allowing your customers to split the payment into several installments, Amazon has made it easier for them to buy their favorite stuff without hesitation.
Gives Amazon a Competitive Edge: Amazon has always embraced the latest trends to ensure a positive customer experience and a smooth shopping journey. Adapting to the BNPL scheme is one of the effective ways to get a competitive advantage over your rivals. And Amazon has done it perfectly. Partnering with Chase has helped the company expand its business to a larger audience and encourage customers to buy stuff across different retail stores seamlessly.
Achieve Customer Loyalty: It’s obvious that customers will want to shop at stores that support BNPL. The convenience of paying money in installments rather than a lump sum sounds super appealing and is a great way to drive customers’ attention.
Benefits for Customers
Convenient: As mentioned before, BNPL offers customers the convenience of making payments over time. They can purchase expensive items without worrying about paying the entire amount at the checkout. They can spread the payment over time and complete it in multiple installments. This helps them buy stuff that was previously not a purchase option.
Interest-and-Fees-Free: You might wonder what makes Buy Now Pay Later different from credit cards. Well, the most attractive thing about the scheme is its interest-free and fee-free payment option. You are not charged a single penny extra for the purchases you made using the Buy Now Pay Later Scheme, no matter the duration of the payment. However, you may incur a charge if you delay the installments. Usually, the company sets up autopay where a specific amount from your chosen payment method is deducted automatically. So, late payment fees should almost never be a problem.
Budget-friendly: Paying small amounts over time doesn’t put you in financial pressure. It also means that you can make several purchases at the same time and set up installments for each, so you can pay a small amount every month.
Buy Now Pay Later aligns with Amazon’s ultimate goal of providing customers with a seamless shopping experience, while improving the company’s bottom line. As we can see, it improves customer loyalty and results in a positive customer experience, which eventually helps in increasing conversions and sales. Partnership with Chase is a smart move, as there’s also a high demand for multiple payment options, especially the ones that allow customers the flexibility to pay in installments. Embracing BNPL is one such way to offer customers a chance to pay when it’s suitable.
BNPL’s Partnership with Affirm Ended
Amazon’s partnership with Affirm ended on 31st January this year. Although the relationship seems to be still intact, Affirm is no longer Amazon’s only BNPL provider. The executives of both companies have remained quiet about the partnership. Affirm is experiencing tough competition, which might be the reason Amazon has ended its partnership with the company. Perhaps, this decision has opened up several opportunities for Amazon to expand.
When talking about the BNPL scheme, Sezzle’s CEO mentioned that budgeting was their main concern. It’s become the most crucial aspect of customers’ shopping journey and Amazon’s decision to work with Chase has helped hundreds of thousands of customers buy their favorite products without hesitation. BNPL is not considered a credit product. In fact, a vast majority of customers believe it is a great budgeting tool that helps them manage their cash flow effectively while giving them a chance to buy whatever they like.
Credit cards do the same. In fact, both work in the same way, but more and more customers prefer BNPL, as it comes with zero interest and zero fees. Of course, paying for something today, tomorrow, or later doesn’t make any difference to the total amount. You will pay the same but over a specific period of time. However, it is the time that matters. Most customers have a specific budget that doesn’t allow them to overspend on a luxury product that requires immediate payment. That’s where the BNPL scheme comes into the picture.
Amazon’s Partnership with Citi
Before its partnership with Chase, Amazon had collaborated with Citi and offered Citi credit card members a chance to pay for their purchases over time using Flex Pay. They could get it in Amazon’s Pay wallet and buy whatever they like using Flex Pay. It worked on most eligible items.
A report by Insider Intelligence shows that the value of Buy Now Pay Later will cross $71.9 billion and will hit a whopping $124 mark by 2026. Not only does it offer convenience to customers, but the strategy might help Amazon boost its Amazon Pay’s success, as they are facing tough competition from PayPal, Shop Pay, and other rivals.
In addition, many merchants are also setting up their businesses on Amazon, as the multiple payment options seem pretty attractive to customers. Customers want convenient payment, but not every merchant has the resources to support that. This has encouraged merchants to sign up for a business account on Amazon to make the best of their sales.
A report by PYMNTS suggests that up to 27% of the population (gen-z, especially) do not buy products from stores that do not have buy now pay later schemes. The partnership between the two has worked as a win-win for merchants and customers. Merchants get to offer flexible payment choices, which eventually attract a large number of buyers, while customers get to pay for their purchases conveniently.
Bottom Line
Amazon and Chase’s partnership has given customers a new and innovative way to buy their desired products not only on Amazon but outside the app and across different retail stores that accept Visa. All that you need is an Amazon Visa or Prime Visa and you are all set to make your first purchase using the Buy Now Pay Later Scheme. So, what are you waiting for? Shop at whichever retail store you prefer and enjoy the convenience of paying in multiple installments. Make sure you pay on time, as late payments often result in interest and fees. We are excited to see how this partnership works and how it helps customers and Amazon.
This year in March, Apple Inc. introduced Apple Pay Later. Users were already using Apple Pay, which is a secure mobile payment service compatible with iPhones, iPads, Apple Watchs, and Macs. Whether you would like to pay in-person, online, or in iOS apps, Apple Pay can be a great alternative to carrying a credit card with you all the time. Wondering how it works? It’s pretty simple. Just take a photo of your credit card, load it in your phone’s wallet, and hold it near an NFC-enabled point-of-sale terminal whenever you make a purchase.
This digital mode of payment is a convenient replacement for PIN and credit/debit card chip transactions. Apple Pay’s evolution over the years has allowed its many users to enjoy the perks of a faster, more efficient payment alternative. By eliminating the need to search through a wallet for the correct card or worry about losing a credit card, Apple Pay has (without a doubt) made checkout easier for its users.
Apple Pay Later
Apple Pay Later enables users to pay for their purchases in four installments over a period of six weeks. Even though the idea was first announced in 2022 during the Worldwide Developers Conference, it was officially released the following year.
Looking forward to buying your desired product but worried that you can’t afford it right now? Apple Pay Later is the right solution for you. It is one of the leading BNPL (Buy Now Pay Later) service providers like PayPal, Afterpay, and Affirm. This service will allow you to split the costs and improve your financial health without binding you to a hefty interest rate or late fee.
Initially, at the time of the Apple Pay Later release date, it was accessible to only a few selected people. The company planned to increase the user capacity in the coming months. Currently, this feature is only accessible to U.S. residents aged 18 years or older.
While there is no ‘one size fits all’ solution to managing people’s finances, everyone prefers flexible payment options without putting a strain on their wallet. Let’s dive into what’s available since the Apple Pay Later release date. This article will cover the benefits, restrictions, and everything else you want to know about this service.
What Should I Know About BNPL?
Most retailers provide a ‘buy now, pay later’ facility allowing customers to purchase their desired item and pay for it over time instead of paying on the spot. It is a short-term financing solution offered by BNPL service providers with multiple installment plans. The interest rate and late fee vary from financer to financer.
Even though BNPL is a clever way to make purchases and split the cost. In the best-case scenario, you might find a provider that charges zero interest. Assuming you can afford the installment, you can get quick approval as there is no credit score requirement. However, this payment plan is still a type of debt and isn’t without risks. Before you decide, make sure Apple Pay Later is the right option for your financial situation.
How To Use Apple Pay Later?
As an Apple Pay user, you can apply for a loan ranging from $50 to $1000 to pay for your purchase. First, you need to open the Wallet app on your device. After entering the amount for the loan in the Waller app, you will be prompted to agree to Apple Pay Later terms and conditions. If it is your first time setting up Pay Later, you will be asked to fill out a short application form.
After approval, a ‘pay later’ option will appear at checkout whenever you select Apple Pay for your online or in-app purchases. You can review your payment plan and loan agreement and add it to your Wallet app.
If this feels like a drag, you can also apply for a loan directly at checkout for a particular purchase once Apple Pay Later is formally set up.
Apple Pay Later Eligibility and Restrictions
Apple Pay Later eligibility criteria are simple. All U.S. citizens aged 18 or above can use Apple Pay Later. You are required to provide a physical U.S. address (Not a P.O. Box). Apple requires you to verify yourself with a photo ID issued by the state or a driver’s license. You will need the latest version of iOS or iPadOS with two-factor authentication enabled at all times.
It should be noted that you will be asked to link a debit card from the Wallet app as your loan repayment method. Some users might think of paying their debt by taking another loan. This restriction will prevent that from happening. Your bank might charge a fee if your account has insufficient balance to pay the dues.
While it is a convenient service, Apple Pay Later is not for everyone. Whether it is a good idea or a total flop highly depends on your financial situation. Let’s discuss the pros and cons of using Apple Pay Later to help you understand what to expect.
Track and Manage Loans
Since Apple Pay Later is built into your Wallet app, you can easily track and manage all your loans within your device in one place. You can also view the total due amount for all your loans and the amount payable within the next month. All your upcoming payments can be tracked on a calendar view of Apple Wallet. Moreover, once your loan application is approved, you can review the remaining amount in the ‘available to spend’ section.
An email and Wallet notification will help you plan accordingly and be on top of your payments. Before completing a purchase, you will see an overview of the four installments. You can either pay manually or use autopay. Tracking your loans and unpaid debts can help you plan and organize everything in the best possible way.
Soft Credit Check
Unlike most loan lenders, Apple Pay does a soft credit check to determine your eligibility for the loan. This way, it can check your credit history without affecting your score or reporting it to any credit bureau. Most companies conduct a hard credit check that can lower a user’s credit score.
It should be noted that Apple Pay Later is planning to start reporting Pay Later loans to U.S. credit bureaus later this year. As a result, these loans will appear in your financial profiles. This is to ensure well-informed lending for both parties involved.
Zero Interest
As discussed earlier, Apple Pay Later does not demand an interest fee, making it more affordable than its counterparts. Most financing options charge a hefty monthly interest fee, which can be a problem for many users depending on their financial situation. Apple Pay Later can help you save the cost of requesting a loan.
User Convenience
If you are already an Apple user, you can directly apply for an Apple Pay Later loan without going through the tedious process of setting up an account with another BNPL service provider. This will save you from losing your credit score.
Consumer-Friendly Features
Several Apple Pay Later features are user-friendly and designed to keep customer convenience and financial health in mind. For instance, if you forget to pay an installment, any additional Pay Later loans will not be accepted, and you will be notified about the missing payment. This will keep you from overspending and getting caught up in debt.
Flexibility
Even though there is an autopay option, you can always opt out of using it. This way, you can avoid over-drafting when you don’t have enough money in your bank account. Users who have enabled autopay can turn it off anytime to avoid inconvenience. If you forget to turn off autopay and payment gets declined, Apple Pay Later will toggle it off on your behalf.
User Security
Every Apple Pay Later purchase is verified through Touch ID, passcode, or Face ID. Keeping user security in mind, none of your transaction history or loan information is shared with third parties. User’s data is not used for advertisement or marketing; your privacy is highly respected.
Some Apple Pay Later Shortcomings to Look Out For
U.S.-based users have several BNPL service providers in their access, and choosing the right one can be tricky. Even though Apple Pay Later has plenty to offer to its customers, here are some loopholes to beware of;
Limited Loan Amount
With Apple Pay Later, you can only request a loan of up to $1000. It is a lot less than what most BNPL providers offer. This loan can cover small purchases and help you manage your minimal financial needs. There is no lie in that. But the chances of buying expensive items like a computer or furniture are improbable with this loan. If you are a heavy shopper, looking for a different BNPL provider wouldn’t be that hard.
Payment Plan Restrictions
Unlike most BNPL providers, Apple Pay Later does not offer a monthly payment plan. Its six-week financing option cannot finance higher purchases, unlike monthly plans, spread over six months to years. However, most BNPL providers demand hefty interest rates, which isn’t the case with Pay Later. So, it all has its perks and losses. Moreover, there isn’t any option to reschedule a payment, and your account will be paused if a payment is missed.
Only for Online Purchases
If you wish to use Apple Pay Later for in-store purchases, you would be bummed to know it isn’t possible. This service is only available for in-app and online shopping. You would have to switch to a different BNPL service provider to access the pay later option in in-store purchases.
Some Technicalities
Apple Financing will assess your credit to lend the loan. Goldman Sachs is the issuer of the Mastercard payment credential required to complete the process. The Mastercard Installments program also plays its part in enabling Apple Pay Later.
If you are a business owner who uses Apple Pay, your customers paying with Apple Pay will be automatically given the option of Apple Pay Later at checkout. In short, you won’t have to go out of your way to enable Pay Later for your customers.
What is the Approval Process for Apple Pay Later?
The Apple Pay Later approval process is relatively less complicated than most BNPL providers. You will be asked to provide your payment details and purchase history. The approval eventually depends on your credit report. Remember that each loan request requires separate approval.
If Apple Pay Later Loan Isn’t Approved
Even if you are a U.S. citizen with access to Apple Pay Later, some factors can cause hindrance to your loan approval process. You will receive an email stating the details of the rejection. Sometimes, a loan application might get rejected for the total amount but approved for a lower amount. In that case, you can purchase other items with a lower price tag or remove items from your cart. You can also switch to Apple Pay to pay in full.
What if I don’t See the Pay Later Option?
You won’t see the Pay Later option at checkout if:
You are not a U.S. citizen or live in an unsupported area
The seller does not offer this BNPL service or isn’t from the U.S.
The items you are purchasing are not eligible for the loan
You purchased after your first loan got approved but forgot to tap on ‘add to wallet’ before purchasing
Contact
Over the years, the ‘buy now pay later’ service has enabled many users to shop while keeping their financial health in check. Apple Pay Later by Apple Financing is doing the same for its U.S.-based users. Currently, the loan amount it offers is limited, but hopefully, things will improve in the near future. All in all, Apple Pay Later is a convenient alternative to the many BNPL providers that charge high interest and late fees.
If you are a U.S. national and regularly pay for products through Apple Pay, Pay Later can help you divide the cost and pay it over a six-month period. (If it costs between $50 to $1000.)
