How To Improve Payment Processing With Direct Bank Transfers

August 21, 2018

Every day, more and more businesses conduct part of their sales and transactions online. Even if the physical part of a company is still very important (a physical shop, a law firm, a doctor’s practice, etc.), almost no one avoids the possibility of having a website, using digital marketing and even offering products or services online.

Although online shopping is still growing quickly throughout Europe (at the same rate as the number of connected devices in homes), there is still some reluctance to overcome. An important segment of the population still doesn’t feel comfortable shopping online, and building loyalty among those who do will strongly depend on offering a good user experience.

Better user experience in payments

One of the keys to reducing user reticence and increasing loyalty is eliminating friction points online, such as web pages with unfriendly interfaces, few (or complex) communication channels with the company, or convoluted payment processes.

Despite the near-ubiquitiousness of digital technology nowadays’, there is still a trust barrier that needs to be overcome when it comes to payment methods. Bank transfers, one of the most efficient ways of processing payments, especially for smaller companies, have been under-used up until now because users are generally distrustful of using or divulging their bank account details for certain types of operations.

Until a few years ago, there was no way of making this process easier or providing users with greater security guarantees. Now there is.

The emergence of direct bank transfer (DBT) payments in the e-commerce landscape occurred with the arrival of FinTech companies such as Unnax and others. By integrating the appropriate APIs, any website can easily process transactions using this system.

Advantages for both parties

Direct Bank Transfer payments not only benefit consumers, but also businesses. Firstly, they offer a payment method to consumers who don’t have access to other options (who, believe it or not, are a non-negligible segment of the population); secondly, with bank matching between buyer and seller, payments are processed in real time and incur no fees; and, thirdly, they reduce the dreaded chargeback request, which are very common in some industries (such as hospitality) and not always made in good faith. Another advantage is that DBT payments have no upper limit on transaction amounts, whereas credit cards often require special authorisations for large payments.

DBT payments have another added benefit: since the payment is executed by connecting directly to the customer’s account, it’s possible to obtain additional information on them in the process. The payment API can read the customer’s account and extract useful information such as the person’s income, expenses, spending patterns, debts, the account owner’s personal information, and more. This is a fantastic customer intelligence source and provides deep insights into what makes people tick online.

Payment Initiation Engine: simple, effective and safe

Unnax’s DBT solution is our Payment Initiation Engine, which provides all the benefits of the direct bank transfer payment system, including a polished user experience for your customers that will boost your conversion rates significantly.

On top of the features we discussed previously, there’s another worth mentioning. Current technology allows us to carry out a process known as tokenisation:  the user’s payment credentials are replaced with a numerical series, which obscure the data to keep it secure. This increases the security of the whole system, while also allowing the API to reuse those credentials for future payments with no further input form the user, such as for a subscription service or other forms of recurring payments.

Direct bank transfers are the next step in payment processing. If you want to increase your conversion rates and improve the satisfaction of your customers, they are the way to go. Unnax’s Payment Initiation Engine lets you get started with just a few lines of code.


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