Electronic payment systems: a boon for your business in COVID-19 era

7 min read
Toshani B

At a time when the COVID-19 pandemic has made social distancing the new normal, cash payments aren’t exactly a good idea. You never know if the currency note your customer is handing over to you is infected by the virus or not. Hence, if you still haven’t added an electronic payment system, we suggest it's time you wake up and smell the coffee.

Restaurant and shop owners who offer delivery can sell more by using mobile payment apps.

Because there’s no need to be physically present to make a purchase, your potential audience becomes almost unlimited.

A growing trend in India

You may have noticed that the payment industry in India has undergone massive changes in the last couple of years. Earlier, Point of Sale (PoS) machines were a common sight at small business premises. But today, digital payment options — particularly mobile payment apps or mobile wallets — are slowly replacing traditional payment methods.
Before you jump onto the digital payment bandwagon, it is important to examine the types of electronic payment systems, their key features and the one that’s best suited for your business.

Selecting the right electronic payment system

Here are some of the most popular mobile payment apps to consider for your small business.

  1. UPI apps
  2. Aadhaar Enabled Payment Service (AEP)

After you have read through our list of apps, keep reading for tips on what to look for as you review your options.

1. UPI apps

UPI (Unified Payment Interface) is the most preferred form of electronic payment system for small businesses as the exchange works through mobile devices. In this method, the funds get transferred between the two accounts immediately.

The interoperability and ease-of-use makes UPIs a popular form of payment.

Here are some of the most popular UPI apps to consider:

BHIM (Bharat Interface for Money)Electronic Payment System BHIM UPI Org

A government of India-backed mobile payment app that supports 20 languages.

Once you download and install this app on your Android/iPhone, you can register for a UPI ID for your bank account and use this UPI pin to receive payments from customers. Payments are credited directly to your bank account.

A seller can initiate a collect transaction just by entering the amount due and Virtual Payment Address. Customers can pay you by using a QR code you create or a UPI pin, mobile number, Aadhaar number or bank account number.

Google Pay

Google Pay is a quick and easy way to send and receive money. It works across all bank accounts that support UPI.

Once you download and install the app, you have to connect your bank account to receive money from customers.

Google Pay has enhanced security that prevents hacking and other attacks on your bank details. Besides, it offers a wide array of cashback and other rewards for transactions.


This is a popular mobile payment app in India that allows customers to easily load money into their mobile wallet and pay merchants using a QR code.

Paytm uses 128-bit Verisign-certified encryption for secure payments.

Customers can send money to you using the payment link shared by you or by scanning the QR code.


Now owned by eCommerce giant Flipkart, PhonePe allows users to link it to mobile wallets like:

  • Airtel Money
  • Freecharge
  • Jio Money

It is easy to use and supports a dozen languages. You can also connect multiple bank accounts with the PhonePe app.


This is another popular mobile payment app that provides a UPI ID or QR code that the seller can share with customers to receive payments.

FreeCharge can be used to collect payment both on the web and in physical stores.

With FreeCharge, you can accept payments via:

  • SBI Pay by State Bank of India
  • PayZapp by HDFC Bank
  • Pockets by ICICI Bank, among others.

According to its website, FreeCharge has 30+ million users.

2. Aadhaar Enabled Payments (AEP)

Aadhaar Pay, essentially the merchant version of AEPs, helps small business owners accept digital payments through the Aadhaar identity system.

Electronic Payment System Aadhaar Pay
This is the most popular mode of transaction for direct merchant payments.

AEP requires a mobile app and a biometric device, with no additional POS equipment.

In order to use this option, you must register with an associated bank by submitting e-KYC details and then download the app through the link sent to your phone. Thereafter, you can accept payments by sending a notification to the customer's bank account. Once the customer approves the transaction, the transfer is made.

Although merchants are charged a Merchant Discount Rate for transactions, they receive 0.5% of the transaction value with a minimum of Rs 0.5 to a maximum of Rs.20.

With AEP, you can also accept payments from customers via bank cards used for transferring funds and making digital payments. Until now credit cards, debit cards and prepaid cards have been the most used digital payment modes. You can also accept RuPay debit cards for digital payments with AEP.

Note that when you accept a credit card payment, the processor deducts anywhere from one to five percent as a fee.

What to look for as you review mobile payment apps

Choosing an electronic payment system for your business requires that you review various factors like how well it works with your current systems, what currencies it can accept, security features, transaction fees and more. So you should research well and be careful in choosing the one that suits your business.

Look for these qualities:

Easy setup

A good payment gateway will have all the processes set already without you having to invest any time. Go for the one with a 24x7 customer support so as to minimize downtime and get instant help anytime and anywhere you are stuck.

Security and fraud-protection

The payment system you choose should instill trust in your clients as they make purchases.

With widespread security breaches in the form of mobile malware, phishing attacks, etc., security is on everyone’s mind.

Ensure you get a secure and proactive system that uses advanced threat mitigation mechanisms such as:

Some apps even include anti-fraud tools that gather information, verify it against embedded methods and stop suspicious transactions.

Value for money

Lower transactional fees are better for your business, but weigh the savings against the features each app provides. Also, pay close attention to hidden costs and whether they are going to improve business productivity.

Multiple currencies

If you have international clients, charging them in their currency will increase the number of completed transactions.

How easy it is to use

A well-designed payment system allows you to keep the customer at your website throughout the purchase (rather than sending them to another site to pay).

Do opt for a payment gateway that invests in proper technology — these are more likely to work with your Contact Management Software (CMS), marketing and sales tools with no issues. Some electronic payment systems integrate with all the major platforms such as PHP, Magento, Android, iOS, WordPress, Ruby, Python, .Net, Java, Opencart, etc.

Summing up

Electronic Payment System Man Sitting at Table

With the COVID-19 lockdown set to continue for weeks — and social distancing likely to continue long after that — you can keep your business open and earn money by switching to touch-free transactions.

So, what are you waiting for? If you are looking for a way to improve client confidence, install the electronic payment system that is right for your business.

This post does not represent an endorsement of any of the apps or products mentioned here. Information was accurate as of publication date.