What Is Cloud Payment Processing?

Just like any other business, the payment processing industry is constantly experiencing innovations and challenges. Payment-processing has evolved drastically since the first electronic payment system debuted in 1973. Some of the core driving forces behind new developments are the drive for cost-reduction, efficiency and speed. This has caused many SaaS and distributed application providers to adopt cloud payment processing.

Cloud computing regarding payment systems involves accepting and processing payments via the internet instead of a physical device run through phone lines. This payment-processing method has many benefits and limitations that are vital to understand.

Concerns About Cloud Payments

It is helpful to analyze and address the questions and criticisms of cloud-based processing. Many people view cloud payments as unreliable and prone to security vulnerabilities. However, this depends largely on the provider. Payment transactions through the cloud can be incredibly secure and reliable when you use the right payments provider.

Improved Flexibility

A key reason for using a payment system based in the cloud is because of convenience and versatility. With a cloud-based system, payments can be made from anywhere your customers use your software. It can also work alongside standard point-of-sale systems. The cloud means more freedom from the restrictions of traditional technology.

Easily Scalable

Another motivating factor for implementing cloud-based payments is the fact that less capital expenditure is needed in comparison to physical systems. Businesses change and grow all the time and it can be difficult to invest in physical systems to adapt. But when payment transactions are managed off-site, capacity is no longer a pressing issue.

Data Integration

Accounting and reconciling payments is easier with a cloud-based system. Integrating such a system with management and accounting software is seamless. Not only does this give businesses constant access to data reports and live sales, but it also provides the ability to place orders and update prices remotely.