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Cryptos for smaller organisations
With blockchain technology gaining greater influence across a range of industries, I’ve written on the subject of ‘How Your SEM Can Benefit From Blockchain Technology’. In doing so, I alluded to numerous possibilities, including blockchain-based cloud storage, smart contracts, and handling digital payments. Here, I’m going to dig a little bit deeper into that last idea, and discuss some of the ways in which choosing to accept payment in cryptocurrency can boost your business.
1. Tapping Into Young Markets
While not every SME is aiming to attract young consumers, most would agree that it can only be a positive thing. And it’s certainly one of the benefits that can come of accepting cryptocurrency. According to a CNBC write-up on interest in bitcoin, millennials are up to five times as likely to say that bitcoin is “the best way to invest for the future” as older adults. That doesn’t necessarily mean that the same millennials are looking to spend bitcoin. But the interest and trust in cryptocurrency is there, and it sets the stage for more spending activity. Putting it simply, by accepting cryptocurrency payments you’ll likely make your SME more appealing to some young consumers.
2. Increasing Transaction Volume
The implication of attracting young consumers is that there will be more business to go around. And this is another general benefit your SME could enjoy by making the move to accept cryptocurrency. An overarching look at digital payment methods by FIS Global points to the various ways in which digital methods can actually increase transactions. The write-up mentions improved transactions across borders, for instance, as well as the fact that simplified crypto payments (like crypto card acceptance) can lead to more new customers. Basically, we’d posit that there are numerous ways in which accepting cryptos can increase transaction volume, without any negative trade-off (or much effort on your part).
Cryptocurrency adoption. Source: Forbes.
3. Setting Up the Future
Preparation is also something to consider. Even if you don’t fully buy into the notion that accepting cryptocurrency will meaningfully impact your SME now, doing so will position you to adapt to future developments in the crypto world. So, for example, if bitcoin gains more traction in the next few years, or if new crypto options emerge that are favoured for payments for whatever reason, you’ll be equipped to quickly accommodate shifting consumer preferences.
4. Speeding Up Transactions
Yet another positive effect of embracing cryptocurrency with your SME is that you may stand to offer faster transaction times to consumers. This may not be a particularly big issue for in-person payments, if your business has a retail component. But where online transactions are concerned, speed tends to be one of the main reasons that some favour cryptos. Quick processing is not just preferred, but expected by many modern consumers, and by at least providing a crypto option you’ll be embracing and catering to that expectation.
5. Lowering Transaction Costs
Last but not least is the fact that you may also stand to lower the costs of the digital transactions your SME processes. These costs never seem like much in the moment, but over time businesses tend to lose quite a lot of money in processing fees paid to services like PayPal and its counterparts — whereas crypto payments occur at no cost. According to Blockdata’s look at crypto savings for merchants, businesses can “reduce transaction processing costs by 70%” by embracing crypto payments.
The future of crypto-payments for SMEs
So, does it make sense for an SME to accept crypto payments? I think it does. Adoption rates of cryptocurrencies, and especially Bitcoin, increasing. It is only a matter of time until consumers expect cryptocurrency payments to be available, pretty much like card payments in retail stores. The SMEs that make this step early, are the ones that will benefit the most. So, if you are the owner of an SME, make sure you learn more about blockchain now, before the competition gets ahead of you.