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How To Encourage Instant Payment And Reduce Credit Borrowing With WhatsApp Payments

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Extravagant credit borrowing can hurt small businesses badly. Credit borrowing is an integral part of the Indian market. It’s a practice that is being followed at every level of the supply chain. Distributors buy goods on credit from manufacturers, shop owners borrow credit from distributors and customers borrow credit from shops. The credit borrowing cycle is deep-rooted in the Indian supply chain system.  

Especially in a country like India, most FMCG wholesalers, distributors, and small businesses offer credit borrowing. While credit borrowing can be helpful as it extends the buying capacity of the buyer but irregular repayments long term credits can hurt the profits of a business. Credit borrowing creates a much longer ROI window for business owners and leaves them little scope for earning profits.

Credit borrowing not only hurts the profit for businesses, but it also creates an additional overhead responsibility of maintaining credit records and making regular demands.

Factors that lead to credit borrowing

While for many, credit borrowing can be a circumstantial act, but for others, it can be the result of preference. Here are some common factors that lead to credit borrowing:

1. Hassle of small payments

WhatsApp Payments: small transaction hassle

If you are a shop owner, end customer, or even a distributor who frequently associates with the same people for purchase, making multiple small payments can be a daunting task. 

Especially if the transactions are made through online payments, you will need to pay transaction charges every time you make payment. By buying products on credit and making on-time payments,  you can save yourself the hassle and additional transaction charges.

2. Lack of sufficient cash

WhatsApp Payments: lack of sufficient cash

Businesses and distributors have limited cash to buy the inventory to meet the demands of their customers. Through credit borrowing, these businesses can stretch their purchasing power to a great extend. Credit borrowing allows them to start and run their business with low capital and repay the credit by selling the goods. 

As for end customers, a large section of them lives on an edge-to-edge budget. They depend on daily wages or monthly salaries to fulfill their needs but at times, they may be presented by situations that push them into the habit of credit borrowing. As a business owner, you obviously don’t want to lose a customer over small amounts and agree on offering the product on credit even if it means delaying your ROI. 

3. WaterFall Credit borrowing

WaterFall Credit borrowing

Waterfall credit borrowing occurs when you borrow credit from the top tier and the bottom tier borrows credit from you. This condition creates a credit dependency chain on the higher tier. 

For example, if end-customers buy products on credit from a shop owner, they will have enough cash to buy products and will in turn have to depend on credit borrowing from its distributor or the whole seller. The distributor or wholesaler will have to do the same with the manufacturer thus, creating waterfall credit borrowing at each level.

How You Can Encourage Instant WhatsApp Payments

How You Can Encourage Instant WhatsApp Payments

Credit is a serious problem for many business owners, but it’s the need of the hour. You need to retain your customers and establish a good relationship with them despite their financial statuses. Nudging your customers constantly for credit repayment can be a dreaded job. Not only does it leave you in an uncomfortable situation, but it also creates a risk of losing them or getting a rude response from them.  

So, how do you ensure that you get timely repayments without affecting your relationship with your customers? 

WhatsApp payments could be your solution.

As we know, WhatsApp has recently rolled out its payment feature which allows you to send or receive money from any of your contacts. Once you link your WhatsApp account with your bank details, receiving or sending money could be as simple as sending an image to a friend over chat. 

The best part about using WhatsApp or WhatsApp Business is that you can connect with your customers or wholesalers through chats. You can send them a friendly reminder for credit repayment, generate invoices, and maintain a credit record all in one place. WhatsApp payments make it easy for you and your customers to make instant payments over chat. 

How do you encourage your customers for timely payments?

According to a survey, reminding customers about their credit dues and giving them regular credit updates can help increase timely repayment by 60%. 

When should you send out a credit due to a reminder?

  • At the end of the month/ week 
  • When credit exceeds a certain limit
  • When a bulk purchase is made
  • When the due date of the credit amount approaches. 

How to make payments using the WhatsApp payments feature

Let us now understand the step-by-step process involved in making payments via Whatsapp (for Android users):

Step 1: Go to the chat window of the person to whom you want to make a payment and click on the attachment icon.

Step 2: Proceed to click on the ‘Payment’ option in the chat window and accept terms and conditions.

Step 3: Enter the amount you want to transfer, UPI PIN and send the money For those with iOS phones, click on the plus symbol in the chat window and follow the procedure from step 2.

Advantages of Using WhatsApp Business For Payments

1 . Keep track of payments. The payee/beneficiary will receive a payment notification on their chat window once the fund transfer has been made.

2 . Send regular payment reminders with a soft tone.

3 . User-friendly ‘pay’ feature that makes transferring funds as simple as sending a photo or a message.

4 . Don’t need to depend on multiple applications for payments, chat conversations, and payment updates.

5 . Customers can select products, place an order, and make payments at the same place.

6 . Make payment to anyone on the WhatsApp contact list from anywhere and at any time.

7 . There is no need to ask the payee for account details such as account number or IFSC Code. All you need is a virtual address to make a payment.


Whatapp payment feature is a boon for businesses, and using this feature in the best possible way can help grow your business, lead to faster payment settlement, and will also help reduce your ROI timeline. Whatsapp payment feature helps reduce the burden of maintaining credit records, generating invoices, and reminding customers for repayment individually.  You can offer credit and receive timely payments without hurting your personal relationship with your customers. 

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