What Is Split Payment, You Must Understand Before Have A Credit Card

What's Split Payment (Unsplash)

YOGYAKARTA - When asked what split payment is, the answer is that separate payments involve the use of several sources of payment to settle all costs from one transaction.

A person who uses two different credit cards to pay for a restaurant guest item or table that divides the bill in three ways is a general example of a separate payment.

Technologically advanced products quickly shift the commercial landscape from physical to the scope of digital engagement.

In the financial industry, traditional services and products that can only be obtained at physical locations and by chatting with a human financial professional can now be obtained online, thereby reducing transportation costs and minimizing the valuable time spent meeting humans.

Fintech, financial technology, has disrupted storage norms and value transfers, enabling service and goods payments for everyone in real-time and at minimal cost.

Innovative mechanisms, such as digital split payments, are being implemented for consumers who have the need to divide payments in various forms.

Separate Used Payments

Separate payments are already used in traditional bricks-and-morters facilities. A consumer can go to the store and buy $100 worth of groceries, pay in cash, credit cards, debit cards, or a third mix to complete the transaction.

With digital transactions, the payment technique is a bit more complicated. Although the e-commerce platform accepts various forms of payment, including gift cards and closed loop gift cards, very few receive separate payments involving multiple credit cards or debits.

One of them is the online retail site Crate and Barrel, which specializes in home furniture and accessories.

Online site checkout pages include three ways customers can pay for a basket of items: gift cards, make up for gifts, or credit/debbit cards. The last option also has an optional feature to pay with two credit cards.

Most online retailers don't have the option to pay orders with multiple cards but find new ways to share payments. For example, to make separate payments on orders of Rp. 100,000 from Amazon, customers with a spending limit of 60 US dollars on credit cards can buy Amazon Prize Cards of Rp. 40,000 using debit cards. During checkouts, customers can then proceed to use their respective credit cards and gift cards with a purchase amount of Rp. 60,000 and Rp. 40,000, respectively, to complete the transaction.

Sharing Users and Payments

Another use of separate payments is to share payments on multiple cards owned by different parties. This feature can usually be seen in restaurant settings or ride-sharing service programs.

For example, a separate payment app allows a group of people who eat at restaurants to receive one bill through the app. Each group member can then pay their bill parts with their respective credit cards using an application installed on their mobile device.

Another company that implements split payments is ride-sharing company, Lyft.

Two Lyft users on the same journey can share bills using the Lyft app on their mobile devices, as long as the trip is still active and they have not been lowered at the final destination.

Venmo's popular financial and payment apps also allow individuals to easily calculate and divide bills for restaurants or other joint purchases.

Benefits of Separate Payments

Separate payments are a convenient mechanism for sharing costs and for customers who don't want to exceed their credit card limits, or who have daily spending limits on their debit card.

If one order has a larger dollar amount than each limit imposed on both cards, the ability to divide payments means that customers can acquire goods without exceeding the limit.

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