E-commerce has expanded significantly over the past decade, and many people prefer to shop online. In India, for example, the number of annual online shoppers reached 250 million and is estimated to grow to 425 million by 2027. As such, customer satisfaction is vital to the success of your online store.
The payment and checkout process is a significant component of the shopping experience. Accepting multiple payment modes is necessary to reach a broader customer base, and the process should also be smooth and convenient, which is essential for customer experience.
Choosing between the many methods available can be difficult. Let’s explore the top 5 payment methods for your online business and how to choose the right one.
Top 5 Payment Methods for Your Business
1. Credit and Debit cards
Using debit and credit cards are some of the most famous payment methods. They allow buyers to make quick and convenient transactions. Debit cards allow customers to make transactions using funds available in their bank accounts. Credit cards allow customers to purchase items using pre-approved credit, and make payments later. Using cards helps keep a record of transactions and has robust security measures. Businesses usually use online E-commerce payment gateways to accept card payments. These gateways process the transaction based on the customer’s information.
2. Cash on Delivery
Cash is still one of the most widely used payment methods, especially for localised transactions. However, it can also be used for certain online businesses. It has many benefits, including its universal acceptability, privacy, and no additional transaction fees. However, it is essential to note that cash payments require strict accounting and handling. Depending on the product or service, they also come with a greater risk for loss and may not always be practical for online purchases.
3. Mobile Wallets
Digital wallets have also increased in popularity in India. They are software-based systems that allow customers to make online transactions easily, transfer funds from one bank account to another, and more. To use a digital wallet, you typically link a bank account to it and add money to the wallet. They can be used for almost any range of goods and services and don’t require cash or a card. Additionally, they are generally highly secure.
4. Third-Party Payment Platforms
Third-party payment platforms allow businesses to accept buyer payments without setting up merchant accounts. They transfer funds from the customer’s account into the business’s account. They are popular and allow your business to accept payments without processing cards. They are also typically secure but may charge high platform fees.
5. Unified Payments Interface (UPI)
UPI, also known as Unified Payments Interface, has also become extremely popular in the country. It works by transferring payments instantly through UPI-enabled mobile applications. It involves generating UPI IDs, or QR codes, that can be scanned to transfer funds. It is important to ensure that your QR codes and UPI IDs are secure from any form of tampering. Their benefits include their cost-effectiveness, security, and convenience. They are widely used in many countries and are easily compatible with many smartphones and mobile devices.
Factors to Consider While Enabling a Payment Method for Your Online Business
Once you have decided on your business requirements, other factors must be considered before selecting your payment methods. These include:
Subscription-based or single-purchase: Will your customer be making a subscription-based recurring payment or a single purchase for a product or service? It is important to determine which payment option would best suit these options.
Geographic availability: It is also important to determine whether the payment methods you have selected are widely accepted in the areas where your customer base resides. If you have a large international clientele, your payment method should be able to accept foreign currencies.
Transaction fee: The overall cost of your transactions can be affected by merchant fees. Finding a method with affordable platform fees is crucial.
Security: This is perhaps the most important factor to consider. The payment methods you choose will record personal and financial data from your customers, so ensuring that they remain secure is of the utmost importance. It is vital to use trusted platforms and methods.
In Conclusion
Several different payment methods may appeal to you. Before selecting any, it is important to research to avoid any gaps in safety, security, unnecessary platform fees, and convenience. It is also crucial to integrate many different methods to reach a much larger customer base.
