Top 5 Payment Methods for Online Businesses
When it comes to online payments, it just means exchanging money electronically over the internet. There are different types of online payment methods. The most popular are debit/credit card terminal, Cash and cheque, net banking, and digital wallets. The COVID-19 pandemic has simply boosted the popularity of online payment methods. In recent years, companies have increasingly integrated online payment gateways into their portals, making these e-payment services a necessity for vendors and customers alike.
What are online payment methods?
Online payment methods are payment types that are used to conduct business over internet. Both buyers and sellers can conduct transactions online by using online payment methods. Online payment methods are simple, although they involve several steps while completing a successful transaction between buyer and seller. It is possible for customers to view the catalogue directly on the seller’s website or in their online shopping cart. After selecting the desired good or service, the buyer will be directed to a payment gateway where they can choose their preferred payment method, such as a credit card, mobile wallet, or net banking.
Benefits of online payments
One of the main advantages of accepting payments online is that you may reach a larger audience. Many online payment systems also include data analysis to assist you understand what your customers are most interested in from your business. Online payments are very time-efficient for both the seller and the buyer. There is no need for line-ups, check writing, or waiting for paper bills.
Since businesses are not required to waste time producing and mailing bills, merchants can save a significant amount of time. Many online payment solutions will have post-payment workflows, allowing your business to send emails to customers to follow up on what they bought. These procedures will keep payments in one location, which makes management simpler than managing piles and files of receipts in an office. Businesses must employ front-desk staff or cashiers to handle sales and payments under a typical payment system. Online payments, on the other hand, are conducted in an automated environment. Low transaction costs and minimal investment are the benefits of establishing an online payment gateway for merchants.
You’ll want to choose an online payment solution that fits your business needs out of the many available today. Consider choices that can scale as your business expands as well as techniques that provide security and excellent customer service.
Best Payment Methods for Online Businesses
The great majority of customers prefer to make purchases using debit or credit cards. A 2020 BRC Payments Survey found that 78% of all retail transactions were made possible by a debit or credit card. A card machine increases efficiency by enabling customers to pay for products or services quickly and easily. Small business owners that do not take cards as the primary form of payment may be losing out on significant sales. A quick and easy checkout process is one of the additional advantages of card payments.
To complete the purchase of the items, customers just need to input their card information at the checkout page. Credit cards are safer because to CVV, short for Card Verification Value. By matching cardholder information with CVV numbers, businesses can identify fraud. Shoppers use credit cards for their additional advantages, such as discounts and reward programmes, in addition to the fact that they are easy to use. By utilising their credit cards, they can also raise their credit score. Despite having innumerable more cutting-edge competitors, all these benefits ensure that credit card payments continue to lead the way. Visa, MasterCard, and American Express are a few of the most widely used and well-known credit cards.
Electronic wallets, often known as E-wallets or digital wallets, make it easier and quicker for customers to make purchases online. Payment process only takes one or two clicks, so the entire shopping process can be completed in a matter of minutes. E-wallets serve as a means of storage for both customer data and money. For customers who choose to use their bank-linked e-wallets to purchase an item online, they’ll be directed to the payment page of their e-wallet applications, where they’ll need to enter their password.
E-wallets are proving to be quite beneficial for individuals because they remove the need for you to enter your login information and credit/debit card details every time you wish to make an online purchase. The most well-known e-wallets, including Amazon Pay, Apple Pay, Google Pay, Samsung Pay, and AliPay, are already among the most successful online payment options.
Using direct debit, UK-based companies can take money directly out of their customers’ bank accounts. Transfers from one bank to another utilise the safe Bacs Payment Schemes Limited network, which helps guarantee compliance with financial security. You can accept one-time payments using Direct Debit just as with credit cards or cash, and you won’t have to worry about the high transaction costs and payment failure rates associated with accepting credit card payments.
Another advantage of using Direct Debit is the ability to automatically schedule payments for due dates, which solves the issue of late payments. Although Direct Debit takes at least three working days to clear your account, if you are a business that needs to collect payment right away, be aware of this fact. However, you can take instant payments by combining Direct Debit with Instant Bank Pay by working with a specialised provider. Another crucial aspect of direct debit is that it safeguards payers from unauthorised debits, making it a very safe method of payment.
Cash on Delivery (COD)
When it comes to online transactions, cards have an advantage. With the emergence of more cutting-edge competitors, cash is becoming less acceptable as a form of payment. But in some circumstances, it is still crucial. Some people still choose cash as their favourite payment method. Even when making online transactions, some customers had to wait to pay until they received the goods or services. Online retailers offer a cash on delivery option for these customers.
Buy Now, Pay Later (BNPL)
A Buy Now, Pay Later system is a short-term loan offered at the point of purchase to customers. These systems, as their names suggest, allow customers to purchase and make their payment later, usually for an interest-free. It works similarly to credit cards; in that you don’t have to pay at the time of purchase. These services do not require customers to have a credit card.