Why offer different payment methods?
If you own an online business, you should appreciate the distrust that buyers have when it comes to paying online. Giving money without seeing the recipient’s face or having the product or service within reach causes a logical fear of being ripped off.
Most consumers in Spain own smartphones (91 percent), followed closely by laptops (83 percent). Right now, technology provides the highest volume of online transactions between businesses and consumers. But the real currency of e-commerce is trust.
In addition to offering transactional security that protects customer data, a great way to build trust is to offer different forms of payment. That way, the buyer will be able to choose the one that gives him more confidence. Think that if you do not offer a payment method that gives you security, that potential customer could go to the competition with a single click.
There are many online payment methods, but the most popular methods you should consider accepting in your online business are Apple Pay, Google Pay, Paypal, and Amazon Payment.
While these most popular methods are adequate, there are also many others that use the same technology, so they are also worth investigating. However, it is important to first understand some terms, and know how these payment methods are provided, processed, and accessed so that you can make the right decision for your online business.
Is it worth the effort to add new payment options?
A study by the Baymard Institute found that 19% of shoppers who abandoned a cart said they did not trust the website to provide their card information. And another 8% directly said that there were not enough payment options.
Doing a quick calculation, for a typical eCommerce store, 70 out of 100 shoppers who add an item to their cart abandon it. And between 8 and 19% of them will abandon it because they are not satisfied with the online payment methods you offer.
By offering more online payment options, you could reduce up to 13% (that’s 19%) of those 70 suspicious shoppers. And by adding the payment methods your target audience prefers, you could reduce the second type of cart abandonment to 5% (the 8% who want other payment options).
Earning up to 18 more conversions per 100 potential buyers is worth it. Here are up to 8 different payment methods for your online store so you can choose the ones you think are best for you.
Payment by credit card
It’s the most common of all. Customers are required to enter their credit card details, which can lead to fear of fraud. It can be done through a payment gateway of some bank, through a private entity other than a bank or with your own SSL.
If you want to offer this payment method in your ecommerce (MasterCard, Visa, American Express, Discover), you need to have an online company account, except for Paypal, which offers payment solutions that do not require a merchant account.
An online business account is basically a bank account for an online business. It allows merchants to deposit and refund online payments, who pay a processing fee for each transaction processed.
Usually, you can get an account for your ecommerce through your credit card bank. For the processing of major credit cards in your online business, you may need to obtain several accounts with separate banks, as many banks only deal with some of the credit cards involved.
You can also obtain an account for your online business through a merchant account provider, such as Merchant Accounts, Beanstream, Moneris, PSiGate or InternetSecure.
Payment with PayPal
PayPal is considered one of the safest payment providers for online shopping. Customers only need an email address and password, which they choose when they sign up for PayPal. The good news is that bank or credit card information is never accessible to the shop or online platform. In case of fraud, you can wait up to 180 days for a dispute to be resolved, which is often a toss-up.
From an eCommerce point of view, Paypal is a payment method you should offer. The number of users is very high, customers already trust this provider and most CRMs have long since integrated PayPal into their system. The downside of this payment system is that the commissions are quite high.
|⚡️Tip: When choosing a service to process online payments, be sure to examine the per-transaction fees, as these vary from one payment provider to another.|
Payment with Amazon Pay
Paypal may be very popular, but Amazon is undoubtedly one of the best known sites on the Internet, and one with which almost all its customers already have accounts. Adding Amazon Pay to your online business can make it easier for Amazon customers to shop at your ecommerce site without having to enter their payment details at your checkout.
You’ll lower the barriers to buying for hundreds of millions of customers, while offering a secure payment option. Amazon’s payment method works well on mobile devices, offering a perfect shopping experience where it matters most.
Setting up an Amazon payment button on your website with its Express Integration option is a task that can take just a few minutes. Or you can use their API, which takes a little longer, but allows you to customize the experience to better suit your website. As with PayPal, the cost of using Amazon Pay is 30 cents plus 2.9% for each purchase.
Payment with Google Pay
This is the payment system developed by Google. Its popularity is far from that expected by the Internet giant, although it is increasing. The great added value of this alternative is its ease of payment from the smartphone.
Industry giants such as Airbnb and StubHub have already added Google Pay to their payment processes. After integrating the new Google Pay API into their website, StubHub saw a 600% increase in unique users buying with Google Pay. Customers are starting to become familiar with this payment method little by little.
Google Pay is very easy to integrate into your eCommerce. Just access the API and add it to your website. After doing some tests, you will be ready to start receiving payments.
Payment with Bitcoins (BTC)
Bitcoins are those virtual currencies that are used only to buy and sell on the Internet. Their use is not very widespread but it has its followers.
This digital currency eliminates intermediaries (i.e. governments and financial institutions) and allows parties to conduct transactions directly between themselves. That, along with the fact that you can use Bitcoin to buy goods and services anonymously, makes BTC an attractive payment option for many people.
Accepting them in the store could attract people who have money in this e-currency.
Paying with Apple Pay
For people who use Apple devices, Apple Pay works as a wallet for when they are away from home, and a one-click payment option for making purchases online. For mobile users, customers can even pay with Apple Pay using their touch or facial ID, making payments has never been easier.
In addition to being fast, Apple Pay is also very secure: it uses token identification to keep credit card information secure, which means that once a user provides their credit card information to the service, the device communicates with the issuing bank to create a randomly generated number (or token) representing that card. This hides the information from hackers, keeping users’ financial data safe while they work quickly.
You can configure your website to accept Apple Pay using its API, as long as you’re already using one of the supported payment platforms or providers. Like Google, Apple’s payment gateway is completely free for both merchants and customers.
Payment on delivery
The customer pays when he receives the product. This gives the buyer more security, although they usually have to pay an additional fee for using this form of payment. As a customer, one of the most significant advantages of cash on delivery is that you can only pay after you have the product in hand. That way, there is no risk of losing the money.
However, one of the biggest drawbacks of this type of payment is that it makes the seller more vulnerable to loss if the customer decides to return the product without paying for it: money has been spent to deliver the product, but in the end it is returned. This adds to the loss of revenue.
Payment by transfer
Bank transfers are a convenient and easy way to complete orders as it is quick for customers to go through the payment process. Customers do not have to worry about security as they do not need to enter any financial details to make the payment. This makes them focus more on what they are buying than on the security of their credit card data.
In addition, as a merchant you will not have to pay any transaction fees into your account to receive payment for orders. Just as with the credit card, you pay before you receive the product or service – a real advantage for the merchant. The downside is that the money can take up to 48 hours to arrive.
Payment with Gift Vouchers
Above all, they are used to build customer loyalty. They will usually only have to redeem the code on your website to get discounts or gifts. They should be given as a reward to regular customers or to promote your shop.
Offering payment by gift cards can also help your ecommerce to capture more sales, especially during the holiday season when occasions like Black Friday or Christmas arrive. Also on special dates like Mother’s Day, Father’s Day, birthdays, anniversaries, etc.
Payment with escrow
It consists of the buyer not paying the seller directly, but leaving the money in a third party account on deposit. The money is not transferred from that account to the seller’s account until the buyer receives the product and checks that everything is correct. This is the safest form of payment available today, as it avoids any possibility of fraud. Marketpay offers you the possibility to incorporate escrow as a payment method in your Marketpay.