Moving to new methods of payment is far from an easy leap for most of us. Recent figures from the Payments Council show that many are concerned about the security of such methods. Nearly two thirds of those surveyed admitted they were worried that payments using the new technology might not be secure.
It is worth remembering, of course, that we all had the same fears about debit cards, cash machines and online banking when they were introduced, and these innovations have now become commonplace. None the less, it is important to be sure about the technology that you are using before you jump in with both feet and your smartphone. The following pointers should help.
Know your limits
Contactless cards allow you to pay instantly by waving your card over a reader in a shop instead of entering a Pin. New technology such as the Barclays PayTag, which is a sticker that you can attach to your phone, and Orange‘s Quick Tap app, which lets you make a purchase using your phone, allow you to cut out the card altogether.
These transactions carry more risk than a transaction using a card and Pin, as they don’t rely on a second level of identification – merely on the fact you have the phone or contactless card with you. Your main safeguard is that the system can be used only for small payments – different limits apply in each case.
However, even small payments add up, and it is important that you know how much you are taking on and check your statements regularly.
Company collapses are likely to proliferate in coming months as the number of businesses delaying payment on their bills continues to increase, heaping more pressure on the struggling small business sector.
Given the standard repayment term is 30 days, this lengthening of the due payment repayment is likely to push more companies to the wall.
By contrast, in 2003 the average term was 45 days and before GST was introduced in 2000 it was 41 days.
Payment trends are known to be an accurate leading indicator of an economic correction. Indeed, the last economic decline was preceded by a blowout in trade payments. The concern is that as the global credit market again tightens, and funding is harder to obtain, the impact of later payments will have painful consequences for many firms.
According to the latest Dun & Bradstreet Trade Payments Analysis – examining the ability of firms to pay their bills, and pay them on time – the number of payments falling within the standard 30-day term dropped 16.5 per cent quarter-on-quarter.
Strange Random Payment Quote:
The payment of debts is necessary for social order. The non-payment is quite equally necessary for social order. For centuries humanity has oscillated, serenely unaware, between these two contradictory necessities.” – Simone Weil (French social Philosopher, Mystic and Activist in the French Resistance during World War II. 1909-1943)
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- Business insurance news: Late payments ‘destroying’ small firms (premierlinedirect.co.uk)
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