Trash into cash: for recycling companies, empowering people to divert recyclable waste has long been an effective and profitable strategy. With the global scrap metal recycling market projected to reach USD 78.1 billion by 2031 (a CAGR of 6.1%) and the global e-waste market predicted to surpass USD 160.2 billion by 2032, (a CAGR of 12.1%), recycling payout programs will continue to be key to meeting and driving demand for recycled materials. And as the latest fintech innovations make it simpler and more cost-effective to issue payouts at scale, the opportunity is ripe to modernize all aspects of the payment experience.
Today, U.S. scrap yards and other recycling companies typically pay by check—or cash, if permitted by state laws. Handling payment administration, including processing checks and collecting 1099 information when applicable, can be time-consuming and expensive. What’s more, the majority of consumers prefer to receive digital and electronic payouts. Given the high costs and complexity of meeting diverse payment preferences in-house, recycling companies should consider outsourcing their consumer disbursements to a fintech partner.
As your business takes steps to reinvent its payment strategy in response to market growth and evolving consumer payment preferences, consider these five best practices for implementing a recycling payout program that drives revenue, operational efficiency, and recipient satisfaction.
1. Cultivate loyalty
According to findings from McKinsey & Company, consumers are more likely to engage with and recommend companies that offer digital experiences. Recycling companies can encourage consumers to recycle again and again by offering branded, digital-first payment experiences designed to drive repeat engagement. Whereas cash and checks don’t come with branding opportunities, digital payment experiences offer multiple customizable touchpoints. You could deliver payments via a custom-branded reloadable card or even implement a loyalty program for frequent recyclers. By providing a personalized and hassle-free payment experience, you’re sure to be rewarded with repeat business.
2. Automate time-consuming tasks
Whether it’s reporting 1099 information or getting to the bottom of uncashed checks and handling the complexities of escheatment, payment administration can lead to hours of extra work for your team. Modern payment solutions offer options to offload and automate many of these tasks, leading to fewer errors, a reduced burden for employees and a smoother customer experience.
3. Prioritize sustainability
According to research from NielsenIQ, 78% of U.S. consumers value a sustainable lifestyle—and they increasingly expect the business community to take action, with over half of consumers asking companies to eliminate waste. And while recycling is a crucial part of a sustainable lifestyle, it offers payouts that can become part of new supplemental income streams for consumers. Recycling companies can reduce the impact of their payment programs by switching from checks to a digital-first payment strategy that can put an end to paper waste and streamline the payment process, contributing to a smaller carbon footprint. It’s a win for your business, your customers and the planet.
4. Reduce risk
63% of consumers find digital payments to be more secure. By switching to a modern payment solution, you can eliminate the security risk of cash payouts while unlocking fraud prevention and detection tools to protect your business and your customers. Recycling companies can also offload the risk and burden of escheatment management and enjoy the peace of mind that their payment programs are fully compliant with state regulations. Learn how Onbe protects your payment programs.
5. Continually optimize
When a recycling company pays by cash or check, their knowledge of the customer ends as soon as that person leaves the premises. In contrast, a digital-first approach often yields more insights to optimize your business. For instance, program data can help recycling companies understand consumer payment behavior, tailor their payment choices to improve recipient satisfaction and cost-efficiency, and engage customers to drive repeat business.
The recycling industry plays a vital role in building a more sustainable future, and its success depends on recycling companies’ ability to keep growing profitably. Updating the recycling payout experience for the digital age is part of that equation. Onbe, a corporate payouts gateway built to manage and modernize payouts, can help you take the next step.