What Do Entrepreneurs Need to Know About Transactions in Business?

When you become an entrepreneur, there’s a lot of things you need to learn in order to become successful. Perhaps one of the most crucial, is transactions.

In order to be paid for your products or services, you’ll need to use some form of transaction. Whether it’s bank payments, credit card payments or online payment platforms; it’s important to give your customers and clients numerous transaction options. However, it’s also important that you understand these transactions and how they should be carried out.

Why is transaction identity important?

Transaction identity is important both for you and the customer. It basically confirms that the transaction is legal and safe. The customer needs to know they are paying a genuine business or individual, while you need to know that the customer is genuine. With transaction identity, this is something you can guarantee.

If you don’t ensure the transactions being made to the company are legitimate, your business could end up losing money. For example, chargebacks can be a particular problem. This occurs when a customer buys a product, then after receiving that product, they report they didn’t make the transaction to their bank. So, the money gets taken back from the business. Without transaction identity, you wouldn’t be able to prove whether or not the transaction was genuine. 

How to improve transaction identity

One of the key ways to improve transactional identity, is to ensure you’re dealing with major banks and payment providers. Online payment platforms can be risky, but companies such as PayPal are continually improving their security and transactions. For example, if there’s a dispute now, a seller won’t lose the funds they’ve received while the case is under review. 

You can also take advantages of the advice offered by professionals from companies such as RSM. They can help with company acquisitions, valuating a business and providing an accurate report. They can also help to assess any risks regarding your transactions.

Top things to avoid

There are a number of ways to potentially avoid transactional issues. Adding e-signatures into your payments or credit transactions is a great example. With this, the customer or client would need to sign an agreement. What you shouldn’t do, is send any products, or perform any services for customers whose payment hasn’t yet cleared. You should also keep a record of any correspondence with them. 

As you can see, transactions can be complex in business and there are numerous ways they can go wrong. As an entrepreneur, you need to protect yourself and your business. Seeking advice from a professional company is a great way to ensure you’re not getting involved in fraudulent transactions.