Ever since its start in 2009, crypto adoption has been growing continuously. Even developing countries like India, Nigeria, and Vietnam are ahead of the US in crypto adoption. But why is it growing? It's innovative, fast, and secure. This is one of the key reasons that big businesses have started accepting cryptocurrency by relying on some crypto payment gateways. But if you think that it is beneficial for only big businesses then you're wrong, and this article aims to address that it is beneficial for small businesses as well.

Relation of Small Businesses and Cryptocurrency

In 2022, a study was conducted in nine major countries including the US, Canada, and Brazil to understand if small businesses want to accept cryptocurrency as a payment option. A quarter of small businesses expressed that they are planning to accept crypto payments.

Despite small businesses adopting cryptocurrencies slowly, many of them are doubtful of it. The factors include,

  • Volatility: The high volatility of cryptocurrencies prevents small businesses, particularly those with thin profit margins, from accepting them due to rapid value fluctuations.
  • Regulatory issues: Unclear cryptocurrency regulations are a big limitation for wider adoption, making businesses choose traditional methods due to the legal complexities.
  • Integration challenges: Upgrading to crypto payments can be expensive and complex for small businesses.
  • Awareness: Many consumers are still unfamiliar with crypto. Integrating a new payment option requires merchants to invest in resources to educate them.

What Benefits Cryptocurrencies can give to small businesses?

  • Reduced Fraud:

Fraud is one of the common problems that small-scale businesses face with traditional transactions. According to one report, it affected 31% of small businesses in the US in 2023. This is where accepting crypto payments can be a strategic move. Because it operates on blockchain technology, transactions are confirmed by miners, making it irreversible. 

  • Minimized Transaction Fees:

Another thing that affects small businesses is the transaction fees. For the majority of consumers, credit cards are still a preferred payment option. This affects small businesses as transaction fees generally eat 1.5-3.5% of a small business's profit margin. However, this is not the case with cryptocurrency as the transaction fee is either 1% or in some cases, less than that.

  • Effective Security:

Because they don't have fine resources for security, small businesses often fall victim to cyberattacks. Due to cyberattacks, nearly 60% of small businesses shut down within 6 months. Cryptocurrency can provide to be effective here. Crypto payment platforms provide advanced security features such as two-factor authentication (2FA) that ensure complete data security.  

  • Access to Fundings:

While traditional investment methods do provide relief to some extent, small merchants are in constant need of funds. DeFi platforms on blockchains provide access to a wide range of financial services, such as lending and yield farming. This reduces dependency on traditional options.

  • Foreign Markets Access:

Every business aims to take its products or services globally and cater to global markets. However, it is slightly challenging for small businesses due to limited resources. However, by accepting cryptocurrency, small merchants can have the opportunity to take their business global as cryptocurrencies operate on a global scale. This can allow small merchants to tap into foreign markets easily. 

How Can Small Businesses Start Accepting Crypto Payments?

If you've decided that you want to accept crypto payments on your platform, let's see how you can do it.

Incorporate a crypto payment platform:

Similar to accepting online payments, you need a crypto payment platform that allows you to send, receive, and exchange cryptocurrencies. Just like traditional payment gateways, there are transaction fees one has to pay. Select the platform that meets your requirements. For instance, some payment platforms charge less than 1% on transactions.

Integrate the crypto payment option:

Once you select the payment platform and register your account on it, it's time to add the crypto payment option. There are two methods to do it.

  • APIs: Crypto payment platforms offer APIs that allow you to integrate them into your site with simple coding.
  • Plugins: If your site is on platforms like Magento, WooCommerce, or Opencart, you can install the plugins easily.

Conclusion

While its adoption among small businesses is still in its early stages, the potential benefits of accepting crypto payments are undeniable. From reduced transaction fees to access to global markets, cryptocurrencies offer a compelling alternative to traditional payment methods. However, choosing the right crypto payment gateway is essential. Coinremitter can help small businesses as the gateway offers easy APIs and Plugin integrations, lower transaction fees,  security features like 2FA, and 24*7 customer support for easy and secure crypto transactions.