Read about the digital transformation of commercial payments and how to automate your enterprise cash cycle.
How Much is it Costing Your Business to Accept Paper Checks?
Mar 17, 2023 by Zazil Martinez
Paper checks are one of the most costly ways to collect payments. Still, many businesses think getting paid by check is the most affordable method. In 2021, 91% of organizations across the U.S. continued to receive checks, even though they understand the associated costs and risks.
The SVB Collapse & Secure Treasury Management: Tools to Manage Cash Securely
Mar 17, 2023 by Brandon Jones
Secure treasury management is top of mind now more than ever. In light of the recent collapse of SVB, we at Paystand are redoubling our efforts to provide CFOs with the tools they need to efficiently manage, monitor, and confidently access their cash resources. What Happened to Silicon Valley Bank? Silicon Valley Bank (SVB) collapsed, and financial regulators seized its assets on March 10, 2023. SVB’s collapse marks the second-largest US bank failure behind the 2008 failure of Washington Mutual. How Did SVB Fail? SVB’s stock collapsed when they experienced a bank run on March 8th and 9th. Several factors triggered the run, including SVB disclosing a $1.8 billion loss and a downgrade from Moody’s risk management agency. By March 10th, SVB account holders found their cash locked up and out of reach. How is the SVB Collapse Affecting the Economy? Depositors will eventually get access to all the money they deposited in SVB. Still, the collapse is causing significant and troubling effects throughout the financial sector in addition to short-term pain for depositors. SVB's collapse reveals an inherent risk within the US central banking system. Banks represent a single point of failure risk, and customers ultimately lack control over their deposits. If a bank becomes insolvent, its customer deposits become insolvent as well. Not all companies are safeguarded with fund reserves and healthy cash flow to maintain financial operations in an emergency. At this point, the biggest objective for CFOs - even if there is no SVB link - is to put the company's money in an appropriate portfolio, as opposed to a single institution. Diversification is key to maintaining fast cash flow, payment control, and business growth. The SVB situation showed that cash flow problems can cascade through a company's operations and impact its ability to pay suppliers, meet payroll, and invest in growth opportunities. Therefore, CFOs must be vigilant in monitoring and managing their company's cash flow to ensure they can withstand potential disruptions in the market. How do We Avoid Crises Like the SVB Collapse in the Future? Decentralization. Businesses still need ways to safeguard their cash flow and treasury while maintaining their ability to pay employees and vendors, receive payments, and grow their operations. Decentralized finance employs open-source technology to diminish banks' and financial institutions' influence on transactions. Without intermediaries slowing down the process, you can receive and reconcile payments in minutes instead of days. Decentralized payments lower processing fees and give complete control to merchants and buyers. This leads to significantly faster transactions, eliminating the need for days-long settlements. This technology has many benefits, including increased security, faster settlements, clear records, and scalability. It provides an extra security layer as data is spread across different servers through the blockchain network, making it hard to hack. Transactions settle in hours or minutes—which frees up cash flow bottlenecks—and are automatically logged and preserved in a "block," which makes managing a clear audit trail easier. An essential advantage of decentralization is its scalability. Payment platforms can expand and grow alongside businesses without penalties, with transactions executed without third-party involvement. Now growth happens without worrying about constraints in the financial processes. By decentralizing, businesses can distribute their risk so that no one disaster can wipe out their cash reserves and their ability to do business. “The SVB situation exposes a risk in banking that few paid attention to. Usually, the discussion among CFOs is how to increase revenue, cut costs, and drive profit margins, not, ‘will the funds in our business checking account be available for us to use tomorrow?’ Paystand, with its decentralized payment network operating on the Blockchain, gives CFOs multiple approaches to collecting, accessing, and managing their funds no matter what." -Jeremy Almond, Paystand CEO and Founder Paystand’s Decentralized Finance Solutions The recent events in the financial sphere have brought attention to a situation we may not have considered. This moment allows us to think ahead, plan, prevent, and take the necessary actions to avoid a financial crisis. Paystand provides decentralized finance solutions that aim to streamline and digitize commercial transactions for businesses. Our solutions leverage blockchain technology, ensuring secure and transparent processes automatically logged and preserved in a block. Smart Treasury Management For Accounts Receivable Treasury management involves managing an organization's financial resources to achieve its strategic and operational objectives. This includes cash, funding, investment, trade finance, risk, and working capital management. Through their Paystand account, companies can automatically route money to their chosen accounts. They can also define the maximum deposit amount and state that when reached, the rest of the funds go to an alternative account. This process repeats as necessary and complies with the FDIC insurance, which protects $250,000 per depositor, per insured bank, for each account ownership category. DeFi Card for Instant Bill Payment Paystand's prepaid DeFi Card empowers merchants to utilize the funds received through the network for vendor payments and operating expense management. As receivables arrive, merchants can direct funds to prepaid cards and spend them freely, earning 1% back in Bitcoin on every purchase. With the DeFi card, money doesn’t go through your bank account. You’ll have quick access to your cash without it getting trapped in your receivables. The collapse of SVB has highlighted companies' need for secure cash management. It is essential to safeguard their cash flow and avoid potential market disruptions. Paystand's decentralized solutions offer an alternative to traditional banking, reducing risk and increasing security, scalability, and transparency. In these uncertain times, a secure and reliable financial system is critical. Companies can better manage their resources by adopting decentralized solutions, thus preventing crises and avoiding bankruptcy from disrupting their operations. Reliable, secure access to cash has never been more important than it is now. Let us guide you on the path of new financial technologies in view of a decentralized revolution. Click here to talk to us about how strategic treasury management can help keep your business running in good times and bad.
Surcharging: A State-by-State Guide
Mar 16, 2023 by Zazil Martinez
Are businesses allowed to charge a surcharge to customers for credit card payments to compensate for credit card processing fees? Surcharging is legal in most U.S. states but prohibited in some. Learn some surcharging best practices, such as investigating and following regulations and giving notice to customers and card companies.
All Blog Posts
How eCheck Can Shrink Time on Your Accounts Receivables
Jul 26, 2017 by Kenzie Earle
Today there are numerous ways for businesses to accept payments online. Whether it is a credit card, eCash, ACH, or an eCheck, companies have multiple options to choose how they want to receive payments. To the average user, the go-to option for payment is usually a credit card or using a bank account via ACH. However, most users overlook two important differentiators between all four of these payment options: speed and cost. Taking a deeper look into each option can help your company make better, smarter decisions.
The First Three Things to Do When Faced with a Chargeback
Jun 2, 2017 by Kenzie Earle
Credit card charge disputes, or "chargebacks," are unfortunately a part of doing business. Reasons for chargebacks are numerous, from stolen credit cards to dissatisfaction with goods or services, and everything in between. Understanding chargebacks, and how your company should respond when faced with one can help make the process easier.
Solutions for Slim Margins in the Solar Industry
Jan 12, 2017 by Kenzie Earle
Solar Power & Renewable energy is one of the most promising new technologies of this century to sweep the nation. A positive change to the legacy energy sector, solar aims to improve the environmental impact, lower cost for customers, and provide a new source to the aging grids. With this growth, over the last decade solar has turned into a highly competitive industry, with each company eager to outbid the next to establish brand and become the dominant player as the nascent industry grows. With this competition, the key question as a solar operator becomes how can you adopt a competitive advantage to improve efficiency and lower your costs.
The Top 5 Myths about Accepting Paper Check Payments
Nov 17, 2015 by Scott Campbell
Here in Silicon Valley it’s easy to forget that not every business process has been transformed by tech’s magic wand. Case in point: over half of all business-to-business payments still take place by paper check, sent via snail-mail. Even more surprising is that many of the companies we talk to are perfectly satisfied with a process that works exactly the same as it did 75 years ago. Are check payments a perfect example of “If it ain’t broke, don’t fix it?” Or has the gospel of digital payments just not reached the traditional business world yet?
How to Use WooCommerce to Email an Invoice with a “Pay Now” Link: A Step-by-Step Guide
Aug 16, 2015 by Scott Campbell
What are eChecks and How Do Businesses Accept Them?
Jun 20, 2015 by Scott Campbell
An electronic check has many names - eCheck, direct debit, direct deposit, and online check are just a few. And while credit cards have been the default payment method for businesses for over a decade, this new alternative is making headway. Essentially a form of ACH processing, eCheck Processing enable your customers to pay you directly from their bank account, using their secure online banking login. Your customer can authorize a one-time or recurring payment as quickly as a credit card transaction. But that's not all. A customer or merchant can even take picture of their paper check and upload it to their payments portal, and the bank will initiate an ACH transaction after "reading" the check. But in most cases, you don't even need the flimsy, outdated piece of paper. Electronic checks are by and large used completely online.