Advantages and Disadvantages of Digital Transactions

The digital transaction is today’s convenient way to pay cashless. Anyone can do this in the comfort of home or during office hours or simply anywhere around the world as long as you have your smartphone and your card.

Globalization and internet has transformed many aspects of everyone’s life. Now, we need a computer and an internet connection to do transactions even outside the home. Financial transactions also evolved because of e-commerce businesses and websites. But digital transactions are not only limited to selling or buying goods but has reached a new level.

Electronic and digital transactions enable individuals, businesses, governments and nonprofit organizations to make cashless payments for good and services. This is done through cards, mobile phones or the internet. This kind of transactions presents some advantages such as cost and time saving, increase sales and reduced transaction costs. But as the it has its advantages, it also has disadvantages. Digital transactions are vulnerable to internet fraud and can increase business expense.

Discussed here are the advantages and disadvantages of digital transactions.


  • Increased Speed and Convenience for Users

Digital transactions can be done using a smartphone, a computer, and an internet. It’s a lot faster than conventional transactions where you have to fall in line, wait for your queue, and sometimes if unlucky, will not be accommodated properly. Other times, you need to have another transaction because of lack of requirements. With digital transactions, they are all done online. You can do any transactions while queueing in line for coffee. Life becomes more productive and fast.

  • Increased in Sales for Businesses

Internet banking and shopping are becoming widespread today. Cash payments and physical transactions are decreasing. But despite all that, sales are increasing. That is because of digital transactions. Businesses gain a competitive advantage over their rival who only accept tradition methods.

  • Reduced Transaction Cost

Using digital transactions reduced the auxiliary cost of paying cash. No additional cost for gas, or fare. Online payment and transaction may ask for a very small amount but negligible compared to other costs you can have in the traditional method.


  • Security

Security measures are tight on digital transactions, but sometimes hacking of accounts happen. Without the superior identity verification measures, anyone can use your details and get away without being caught. This makes digital transactions unreliable for some people especially those who are used to the traditional method.

  • Disputed Transactions

Unauthorized use of electronic money is one reason why many people still would go with the traditional method. Refunds are also difficult to ask if there’s no sufficient information.

  • Increased Business Cost

Additional cost may apply to the use of digital transactions. It is one way for e-payment systems to protect sensitive financial information stored in a business’ computer system.

What is good for someone is not be suitable for everyone. Digital transactions may be convenient for some, but to those who are used to conventional methods, there is no way to persuade them more. Many will trust digital transactions, but many will not because of some reasons.

For a more secure and reliable digital transaction check out