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Payments are a core tool for individuals as well as businesses that need to pay for any product or service they purchase. Two decades ago, payments were made physically at points-of-sale or banks using cash. Just as technology began entering different sectors, it invaded the payments sector by initiating the credit or debit cards that shifted the way payments were made from using cash to a cashless process.

After the widespread of the payment cards, technology continued to change the way consumers interact with payment systems by creating new ways of payments. The internet and digitization have paved the way for the adoption of electronic payments, better known as “e-payments”, which has simplified and facilitated the way transactions are made.

E-payments are payments made via digital or electronic channels including mobile and internet, and using infrastructure such as mobile phones, computers, cards, ATMs and point-of-sale devices.

With that being said, the acceleration of e-payments has supported ecommerce and brought significant benefits. Ecommerce platforms depend heavily on websites or applications since their products or services are sold and purchased through a click and mortar platform.

Aside from simplifying the process of physically collecting cash payments, e-payments affected ecommerce through being both cost and time effective for the supplier. That is precisely why many suppliers or producers of ecommerce platforms chose to adapt e-payments as a means of receiving the money for the purchased service or good.

Combining e-payment with ecommerce or any other online tool for small businesses expands their customer base providing them with a larger outreach to any country or region across the globe. Simply put, ecommerce becomes a possible and more practical platform through depending on e-payments.

While e-payment services have become embedded into consumers’ every day, connected lives, ecommerce still faces an array of challenges that range from fraud and embezzlement, cross-border transactions, card data security, multi-currency, to systems integration.

Online transactions do not require the physical presence of the consumer making them more prone to face fraud or embezzlement by a hacker. Simply entering a pin or password is not sufficient to protect your account. Biometric identification, such as fingerprint recognition, is being frequently used to increase mobile payment security and prevent fraud.

Breaches on card data security also may occur for the above reason. Every ecommerce platform or merchant that accept debit or credit cards online are required to acquire the Payment Card Industry Data Security Standards (PCI DSS) certification to reduce the risk of fraud and embezzlement.

Global ecommerce platforms that function worldwide need to accept multi-currencies. E-payments facilitate the financial transaction of any purchase from the consumer to the merchant.

Cross-border payments can be slow, inefficient, and expensive because national banking infrastructures can’t handle global transactions. To amend this restriction, governments should consider creating initiatives and mandates to regulate payments and outsource.

Multi-currency and cross-border transactions require merchants to have a new bank account for their business that comes with many regulatory complications. To solve this problem, merchants are encouraged to select a payment service provider with the necessary infrastructure ready where all they need to do is collect their money in one currency and credit their account in its home currency.

Just like any service, e-payments could face challenges in both the hardware and software technical integration systems that may result in processing and payment delays, lost transactions, and expensive fees. Online payment providers are capable of offering many third-party integration arrangements or APIs.

There is no doubt that e-payments’ integration has facilitated and advanced ecommerce platforms and has made many stores that have gone online more accessible. However, the consumer, business, supplier, and merchant need to be aware of the challenges that may arise when choosing to adopt or pay via e-payment services.