Customers can drop off quickly. Whether you’re running a fintech, a freelance work platform or a gambling app, slow settlements are bad for business. But what causes friction points in withdrawals, what makes fast withdrawals so integral, and how can reducing friction in withdrawal help you avoid retention-sapping problems with payment processing in your startup?
This article will attempt to answer those questions, and others, succinctly but with enough info for you to move forward with a basic plan of action. Fast withdrawals keep customers happy at key points in their cycle, reducing churn and promoting loyalty or even referrals. There are tools and strategies to make sure that happens, but it needs to be somewhat of a focus to get it right – at least at first. This piece will give you all the info you need, plus some key practical steps, to make it happen for your business.
Why Fast Withdrawals are a Smart Business DecisionÂ
Payout friction will be one the biggest pain points in any customer journey. In fact it can derail the entire experience. Each extra piece of documentation or email needed, each misunderstood communication or day of delayed payment means more chances for users to get disillusioned with the service and start exploring alternatives.
Freelance platforms often provide essential funds for someone’s general living expenses. Fintech apps often help manage these essential finances. Gambling apps and trading sites main appeal is the potential to make money, making delayed payment essentially delayed delivery of the service. Fast payout casinos – within 24 hours or less –  have higher retention, more monthly deposits per user and even see more referrals for new customers.
For casinos, any payment systems that take longer than two to three days to process are at a significant market disadvantage. For gig work apps, things are a bit more flexible but stability and regularity is key. Most workers don’t mind waiting a month or a week while they build up a paycheck as that is traditional in most jobs – but they will mind if payment is late or doesn’t have a regular schedule.
Typical Friction Points in the Process to Look Out For
There are a few predictable bottlenecks in the process, which is good for founders as they are easily identifiable and solvable with some swift action. Common problems with online payment systems customers experience include:
• KYC delays – systems that don’t clearly explain what is needed, or are poor at recognising real world photos of documents from users, can require multiple submissions which is painful for customers
• Unclear or no communication – users expect to be able to access emails or notifications at each stage of the process, from processing start to sent and received
• Approval queues – not having enough staff, or not using an automated system, to ensure documentation is checked and errors resolved in a timely manner can lead to backlog
• No diversity of payment options – if the only payment choice you have is bank transactions, and these are proving slow for customers, consider looking to into ways of expediting the process or bringing in e-wallet or crypto payments
Explanatory content for your app or website is also important. While it might be obvious to many, some people just might not understand that a card withdrawal can be slower than an e-wallet and be dissapointed when it is. Customers more experienced with your kind of product or service will want to know more details than most, and without clear information they might leave before even signing up.
Practical Steps Founders Can Take to Mitigate This
One way to ensure that a user is taking advantage of the fastest payment options available to them is to write up informational guides for each type of payment you offer. These are also SEO-friendly as they expand the content of your website or platform and set you up as an authority knowledge base on top of what else your business offers.
Here are some other steps you can take to ensure your business processes payments efficiently:
• Pre-verify important info at onboarding – customers expect some sign up process, so hit them with this potentially painful part now rather than when they’re feeling happy with the product after making some money
• Use automation (but carefully) – AI has come very far in the past few years, and automated document scanning and processing is more efficient than ever. Just be sure to pick a highly rated system.
• Transparent updates – make sure to keep customers notified with automatic emails or notifications during each step of the withdrawal process. Delays should also be clearly communicated when they are unavoidable.
• A varied selection of payment options – this lets customers have the choice and info they need. If they decide not to use a faster option then that is their choice. It also offers fallback options if one platform or system becomes unavailable.
Before you begin any implementation an audit of average payout time, as well as the average length of any delays and what caused them, will help you identify which of the above steps will be the most helpful. Once you have made changes, use analytics platforms track the increases in retention and other KPIs that will hopefully result.
