How to encourage BACS payments...?

[privateer]

In the New Year, I'll move over to a proper shopping cart with online CC paymants available to (retail) customers for the first time.

Until now, customers have paid by PayPal (perhaps 50%), BACS using details that I email them (perhaps 40%) or cheque (about 10%). Once I add CC as an immediate online payment method, I fully expect many customers to use that in preference. (Meaning I also have to wise up on fraud potential, chargeback risk, etc.)

But I'd quite like to promote BACS use. With Faster Payments, it's about as instant as PayPal. Maybe with a discount incentive?

However, it's not fully automated (obviously). If I want to keep my email admin down, I'd have send an automated ordering email with the BACS info (in plain text) and hope that they follow through and go to their online bank to make the transfer. (There remains the issue of potential fraud through misuse of my bank details, too).

Just wondering if other forumites offer BACS payments for retail customers through shopping carts? If so, how?

Or if you've tried and given it up? Or looked at it and rejected it?

Thanks in advance.

 

[privateer]

B*gg*r! Should have started this in the E-commerce subject area (schoolboy error...)

Is there a friendly mod who could move it?

 

[Geoff T]

Is there a friendly mod who could move it?

try a "please" or "pretty please"...

And if that fails - go to UK Business Forums at top of page, scroll down to see members listed, then PM one of the names in bold (blue box with white letters)

Should sort you out

 

[Scott-Copywriter]

In the New Year, I'll move over to a proper shopping cart with online CC paymants available to (retail) customers for the first time.

Until now, customers have paid by PayPal (perhaps 50%), BACS using details that I email them (perhaps 40%) or cheque (about 10%). Once I add CC as an immediate online payment method, I fully expect many customers to use that in preference. (Meaning I also have to wise up on fraud potential, chargeback risk, etc.)

But I'd quite like to promote BACS use. With Faster Payments, it's about as instant as PayPal. Maybe with a discount incentive?

However, it's not fully automated (obviously). If I want to keep my email admin down, I'd have send an automated ordering email with the BACS info (in plain text) and hope that they follow through and go to their online bank to make the transfer. (There remains the issue of potential fraud through misuse of my bank details, too).

Just wondering if other forumites offer BACS payments for retail customers through shopping carts? If so, how?

Or if you've tried and given it up? Or looked at it and rejected it?

Thanks in advance.

Online buying can be EXTREMELY sensitive. The wording of an order button can even influence the sales rates.

You will really risk damaging your sales by giving your customers more procedures to follow, so you need to simply offer it as a no-pressure incentive. Use radio buttons on the check-out so the customer can select BACS if they wish. Perhaps you could add something in brackets next to it explaining what the customer will have to do.

 

[DaveSUK]

We're not retail but we do offer services which can be ordered online, and offer bacs as a payment option to do this we set up a separate receiving only bank account with barclays for security reasons we didn't want to put our current account or reserve account details online our business banking manager set up an account which is tied to our current account, money goes into the receiving account and can only be transfered to the current account, money can be removed from the receiving account by any other means.

Before I sold the retail side of our business we where accepting credit card payments, and because of the value of the order we still did an identity check with experian to make sure the card holder details corrospond with details held on their credit file. We had one charge back in 3 years for £1,800 but we got barclays to dispute the charge back based on the information we had and we won.

Offering BACS is ideal if your target market is business customers some of the larger organisations don't have access to credit or debit cards and deal only with cheque and bacs

 

[privateer]

bacs as a payment option to do this we set up a separate receiving only bank account with barclays for security reasons

Excellent idea. That would reduce the biggest risk. And when I say 'BACS' I simply mean customer's personal online banking using my sort code and accout number (I just gather that BACS is the underlying mechanism for UK customers).

Scott-CopyandDesign: yes, I'm trying to streamline ordering and payment, and hope to avoid anything that looks or works as a deterrent. At the moment my system is so antiquated that customers have to jump through hoops. I like BACS because it avoids CC charges, chargebacks, etc - and over the last five years quite a lot of cheque payments have moved over to BACS.

 

[iArtist]

Most of my customers pay by BACS (they're mainly online customers, so this is perhaps fairly straight forward for them as they're at their pc when communicating with me in any case).

A couple have paid via Paypal, I think for the ease of doing so. Logging into bank accts can be a pain.

One local customer kept forgetting to set up the BACS payment so in the end I had to pop round and collect the cash. He was ok about it and I didn't hassle him re the late payment. I understand for people who don't do business via the Internet, that these things can be a drag and so late payment was more oversight than deliberate.

I don't like payment via cheque as I have to post them to my internet bank (via trip to post office) and it delays payment by couple of weeks.

I think it's very important to offer customers options for payment as the different methods may determine whether they order from you. The method must be convenient for them ideally. But if cheques are a pain (as they are for me) hopefully you can come to some alternative arrangement to suit you both.

 

[Scott-Copywriter]

Scott-CopyandDesign: yes, I'm trying to streamline ordering and payment, and hope to avoid anything that looks or works as a deterrent. At the moment my system is so antiquated that customers have to jump through hoops. I like BACS because it avoids CC charges, chargebacks, etc - and over the last five years quite a lot of cheque payments have moved over to BACS.

They will always have to jump through hoops if you do anything other than a simple card or paypal payment. This can be a deterrent unless the customer wants to use an alternative payment method, so you have to offer it as an option.

If you prefer a different payment method and then try to pressure it on your customers, you're going to damage your sales.

Dave has a point as well. Large businesses or large orders are more likely to deal with BACS (or Cheque, but this is likely to move over to BACS eventually). So, at least you can offer it and hopefully it will be taken up by large orders which will eliminate charges and charge-backs for very large amounts.

Service based businesses also tend to use BACS more. Like Leah, that's pretty much all my clients use apart from the occasional Paypal payment.

 

[FreelanceSoftwareDeveloper]

Personally as a buyer, I would want to pay there and then and have it confirmed. If I checkout then pay by BACS I probably need to write down a reference number, I have to go through all the process of setting up the payment, switching between windows to enter the account and sort code.

It's a long manual process in online shopping terms. Ideal for B2B as businesses get charged to use a credit card, it's also clear the money went from A to B on a set date. It's also ok for contract type work such as design work as it's not an instant process. I just don't think it works in an online shopping environment if your selling to joe public. Paypal is easy and safe, Credit Card is safe and I won't actually pay it for a few weeks, I might also get some reward points or cashback.

The question is why should I use BACS, a discount possibly but as mentioned by Scott if there isn't an easy way to explain this it will look confusing. Also your asking the customer to go out of their way to get a better price, I don't think it looks great, your holding me at ransom, go do all this and i'll give you some money back.

I would look elsewhere before buying from you if for personal use, I don't want the hassle of BACS as a consumer and I don't want to pay more to use a normal payment method.

If you were supplying to my business then i'd be happy to do BACS!

You should be the one appearing to jump through hoops for me, not the other way around, i'm the one giving you money.

 

[privateer]

All very useful replies. At the moment I do all ordering via emails (manual, slow, some lost sales), and I offer every customer four methods:
* cheque
* online banking (i.e. BACS)
* transfer (i.e. for overseas customers) - arrives via CHAPS
* PayPal

So there are several to-and-fro emails before payment is on its way. But I have few (VERY few) chargebacks/etc problems.

For sure, many customers would, for the most popular products, like to buy instantly - as you all say above. So that's why adding instant CC payment via a gateway is a definite. I can also make PayPal an instant method, too.

My gut feel is that there are some customers (might be something to do with my 'old-fashioned' market) that like online banking - despite the extra hassle. With Faster Payments, it's not slow, so there's no significant delayed shipping issue.

I'll only know when I get cart+CC processing online...


Just got to keep a handle on the chargebacks if a significant number of people move