Micropayment systems online encompass the payment systems that are used to facilitate a small transaction. Most of these payment systems minimize the overhead cost of a single payment transaction. Such micropayments do save costs such as that of set up, financial risk management, and operational costs like processing.
Defining small payments
Small payments are usually made online through payment gateways. These payment transactions are considered small when the amount is from one cent to twelve dollars. An example of online content that can be purchased for that amount are downloads of e-books and the like.
Small payment transactions as an option
An outright small payment transaction is an option that is often presented instead of engaging the consumer to sign up for a subscription. By doing so, it enables the consumer to have access to only those downloads or services that they want, instead of having to pay for a bigger amount to have access to all. For example, if there is a site that provides streaming movies, instead of signing up to watch movies for a month, the user can opt to watch just one movie by making a micro-payment transaction.
There are online companies that accept micro-payments for their content such as streaming music and also supplement their income by placing advertising. These content providers rely on micro-payments as a source of revenue yet also gain income from the visits due to advertising. Such content provider sites that accept a small payment transaction include that of gambling, database look-ups, and proxy services.
Just a decade ago, accepting small payments may not seem like a financially feasible business model. The payment system of such sites must be developed for small amounts. However, it has gained popularity because nowadays, there are payment systems that do cut down the cost of a small, single payment transaction. Just a few years ago, it would be difficult to offer small payments because of the high cost of the fees of credit card providers. However, there are now many advanced payment solutions that make it possible for a small payment transaction to have minimal fees or at times, no fee at all.
There are micro-payment platforms that were developed during the start of the millennium. These platforms paved the way to standardize the mark up for the small payment transactions. These platforms were created with the future of online payment transactions in mind. The development of these micropayment systems included the preliminary standardizing of duration, type, and price.
Advanced payment solutions
There are now advanced payment solutions that make it possible for a consumer to make a small payment transaction by paying a minimal fee or even no fee. When one makes a payment transaction using the right peer-to-peer app, there are no fees for sending funds instantly. By choosing the right payment app, which is that of an e-wallet of this reliable payment provider, a consumer can send unlimited payment transactions without having to pay any transaction fees.