A receiving agent service is a payment service that allows customers to pay for goods and services purchased online – as well as utility bills such as electricity and gas bills – at convenience stores.

If a business uses a receiving agent service, it does not need to sign individual contracts with each convenience store. The business can also enter contracts with multiple payment reception points at once, ensuring efficient business operations.

If the site customers are shopping in already has contracts with a receiving agent, they will be able to pay at a convenience store without needing a credit card. This increased convenience might result in more customers visiting the site.

In this article, we will explain the basic features of receiving agents, including how they work, the fees involved, and the advantages and disadvantages of using them.

What’s in this article?

• What is a receiving agent service?
  
• The advantages of using a receiving agent
  
• The disadvantages of using a receiving agent
  
• The difference between receiving agents and payment agents
  
• How to choose the right agent for your company
  

What is a receiving agent service?

A receiving agent service collects convenience store payments that customers make, and it is sometimes called a “convenience store receiving agent.” Businesses can reduce their workload by using a receiving agent; they sign a contract with one receiving agent company, which then handles payments from all convenience store companies.

There are various payment methods that companies and stores – including e-commerce websites – offer to their customers, such as credit card payments and iD payments. However, although these cashless payment methods are ranked highly in terms of frequency, there are also customers who are reluctant to use them due to security concerns. In Japan, customers still use convenience store payments – i.e., payments via receiving agents with the option to pay by cash – in a variety of situations, such as paying utility bills and national health insurance premiums.

Additionally, the number and types of payment methods a business offers can greatly affect online sales, such as in the case of receiving agents and various cashless payments. For the customer, the more payment options an e-commerce website offers, the easier it is to buy products. Therefore, if businesses can respond to the payment needs of a wide range of customers, they will appeal to a larger market and can potentially increase their sales.

By using both cashless payments and a receiving agent service, you can offer convenience store payments from your own ecommerce website, expanding your customer base.

How a receiving agent works

Receiving agent services complete payments by following the following steps:

• A business issues a payment slip or a payment number to customers who have ordered products or services.
  
• The customer pays at the storefront or terminal of the convenience store.
  
• The convenience store notifies the receiving agent that a payment has been made.
  
• The receiving agent transfers the payment to the seller.
  

Note that it usually takes 50 to 60 days from the time the customer makes the payment before the funds are transferred to the business.

Fees for receiving agent services

In addition to the initial fee that a business incurs when the service begins, there is also a basic monthly fee and an additional fee for each transaction.

The amount of these fees will vary depending on the services provided by each agent service. However, when deciding which agent service to use, it is important to carefully choose one that best suits your needs – taking into account its prices and also the quality of its services and security measures.

In addition, you should compare the expenses involved in using a receiving agent service with the expected sales you will gain from using the service. It is also important to consider the best time to implement these services, so that you can plan ahead financially.

The advantages of using a receiving agent

The main benefits of using a receiving agent are:

Your sales opportunities will expand

If an online shop only accepts credit card payments, customers without a credit card will not be able to purchase items from that shop. The circumstances of customers who do not have credit cards vary; in some cases, they are concerned about security risks or they have difficulty obtaining a credit card due to problems with their credit history.

However, if the business uses a receiving agent to accept convenience store payments – instead of targeting only those customers who have credit cards – the business will be able to target a wider range of customers, such as those who can only pay in cash.

Convenience stores that are open 24 hours a day not only meet the needs of customers who prefer to pay in cash, but they also offer significant benefits to the seller: they can provide services and collect payments in advance by charging before goods are shipped.

You can consolidate contracts with each convenience store company

Contracting directly with every convenience store company can be a significant burden for a business, as it must deal with each company individually.

However, if you use a receiving agent service, the receiving agent will act as an intermediary between you and the convenience store companies and handle the procedures on your behalf. This way, you can complete a contract with multiple convenience stores all at once.

By contracting with just one receiving agent service, you can handle payments from multiple convenience stores. This simplified contracting process significantly reduces your administrative burden.

Managing payment information is easy

Receiving agent companies provide information management services related to customer payments, including notifications of payment and delivery status. For example, if a customer makes a payment using the service, the agency will send a notification to the business.

Since the receiving agent tracks the status of payments through its information management services, the business does not need to pay attention to each order. This makes it easy to avoid mistakes and problems such as the delay or execution of a shipment when its payment is unconfirmed, and it can lead to improved services overall.

By using a receiving agent service in this way, it is possible to centrally manage a large number of payment details, allowing the operator of an e-commerce website to carry out work efficiently.

The disadvantages of using a receiving agent

While there are many advantages to using a receiving agent, such as the expansion of sales opportunities, there are also several disadvantages:

There are fees and other costs involved

There are various fees involved in using a receiving agent service. As a result, in some cases, you might not find it profitable to use this service.

Receiving agent services usually have a basic monthly fee. However, in addition to this fixed cost, a business incurs a fee each time a customer makes a payment. Therefore, if no customers use the convenience store payment system, the monthly basic fee might be an unnecessary expense.

To prevent this, it is important to assess the cost-effectiveness of the service while considering your company’s customer base and other important factors before deciding whether to use a receiving agent service.

There is a risk of not collecting payment

Receiving agents offer two payment methods: pre-payment and payment on delivery. With payment on delivery, the customer pays at a convenience store using the payment slip enclosed in the delivery they receive.

However, in this case, if the customer does not make the payment after receiving the order, the receiving agent will not be able to collect the payment. This represents a significant loss of revenue for the business. For this reason, businesses using payment on delivery need to be mindful of the risk of not being able to collect payment.

Depending on the receiving agent service, there might be systems in place to guarantee or insure payments that the business is unable to collect. However, these systems increase the fees charged by the receiving agent.

Security risks can be caused by the use of agents

We introduced the fact that receiving agents manage sales and customer payment information as one of their benefits earlier. In other words, the business operator shares this information with the receiving agent.

However, this also means that if there is a problem with security on the part of the receiving agent, such as a data leak, then there is a risk of damage to the company’s reputation and a loss of public trust.

For this reason, it is important to make sure that the receiving agent has adequate security measures in place.

The difference between receiving agents and payment agents

Both receiving agents and payment agents are services that handle payment-related tasks on behalf of the customer. However, there are some differences between these two types of service.

• Types of payment methods that can be used
  Generally, receiving agents specialise in payment via convenience stores. In contrast, payment agents also cover a variety of other payment methods, including credit card payments, electronic money payments, and internet banking. By using a payment agent, you can introduce multiple payment methods at once.
  
• Who pays the fee?
  Handling fees work differently for receiving agents and payment agents. When you begin using a receiving agent, you can specify whether the business or the purchaser will bear the cost of the handling fee. However, with payment agents, the business operator typically bears the cost of the fee.
  
• Type of transaction
  Receiving agents specialise in convenience store payments and are typically used for business-to-consumer (B2C) transactions with general customers. Payment agent services, on the other hand, can be used for business-to-business (B2B) transactions in addition to B2C. Compared to receiving agents, payment agents offer a wide range of services that are useful for B2B transactions.
  

How to choose the right agent for your company

It’s important to make the decision about whether a receiving agent or payment agent is more suitable for your business based on a variety of factors.

If your company’s e-commerce website has many users who pay not only at convenience stores, but also by credit card, you might want to choose a payment agent. On the other hand, if you are able to meet your customers’ needs by only accepting payments at convenience stores, you could choose a receiving agent service that will keep costs relatively low.

If you choose a payment agent, it is important to understand the details of the fee structure, as the fees will increase for each additional payment method handled. In contrast, as explained in the section above, receiving agent fees vary depending on the services you contract for.

Therefore, when deciding whether to use a receiving or payment agent, you should not focus solely on price. It’s also important to check the level of service provided and whether security measures are in place, which will allow you to make an informed decision based on an understanding of the scale of your business and your customer base.

Stripe Payments supports a wide range of payment methods, including convenience store and credit card payments. In addition, Stripe Payments provides a variety of payment-related functions, such as implementing payments, processing information, and managing revenue. Stripe also complies with international security standards such as the Payment Card Industry Data Security Standard (PCI DSS) by taking thorough security measures for personal information and transaction data to prevent unauthorised access – such as using data encryption via Secure Sockets Layer (SSL) and Transport Layer Security (TLS) technology.