More consumers are using mobile phones to make payments. According to estimates provided by Bank of America, 4.4 billion consumers globally will use digital wallets by 2025, compared to just 2.6 billion in 2020.

Digital payments are electronic transactions that do not require exchanging cash. They are made primarily using digital devices (phones, iPads, computers) and the internet. The digital payment ecosystem relies on several intermediaries working together to achieve a smooth transaction. End-to-end processing of a digital payment transaction involves the business (payee), the consumer (payment sender), the financial institution, and the payment network.

Benefits of Digitized Payments

There are many reasons for the shift to digital payments, including ease of use—you can make and receive payments at any time, from anywhere, and do so faster and more securely. With electronic payments, you’ll get constant updates on the status of transactions to track exactly when money will hit your account. Once the payment is complete, the platform will notify both parties.

You don’t have to worry about checks being stolen or forged. Check washing is popular among thieves. They steal checks from individuals’ mailboxes and wash the information off the checks so they can rewrite them for their nefarious activity.

In fact, according to a Bank of America survey, 73% of businesses are transitioning their B2B payments from paper to digital. Digitizing payments can greatly improve the efficiency of the entire process involving financial approvals and account reconciliation. Accepting digital payments instead of cash or checks lets your construction firm streamline bookkeeping, eliminate friction at the point of sale, and lessen the risk of mail fraud.

As a contractor, you can also attract new customers and more projects. More clients expect contractors to accept digital payments via tools such as direct deposit, credit cards, and peer-to-peer services (P2P) like Zelle, Venmo, PayPal, or Cash App. With P2P services, both parties must have active accounts on the platform, and there is a spending limit.

If you haven’t jumped on the digitized payment bandwagon yet, consider doing so. Your business will benefit from offering more options to customers and making payment transactions easier.