In the dynamic online shopping landscape, offering the right and varied payment methods is critical for the success of your eCommerce business. Understanding consumer preferences and prioritizing convenience and security will help boost conversions and customer loyalty. In this blog, we’ll explore what payment options today’s consumers expect and how businesses can stay ahead in the competitive online marketplace.
In the eCommerce industry, a major way of getting sales is to make the buying process as smooth as possible. The more seamless the checkout process, the faster the conversion. The payment methods business owners choose for their eCommerce business play a crucial role in sales. The more variety of online payments, the higher the chances of customers buying the product. Various factors contribute to this decision. However, customers have certain expectations when they shop online.
Types of Payment Systems Available in eCommerce
At the onset of eCommerce, the payment methods available for online purchases were limited, and the checkout process was complicated and time-consuming. However, with advances in technology, various payment systems have become available for the convenience of customers. Though some eCommerce business owners have online and offline payment methods available on their websites, most people prefer online payment methods. However, offline payments are considered more secure as they often involve cash payments. Since a considerable bulk of shopping is online nowadays, providing security during monetary transactions is essential. The different types of payment systems available in eCommerce include the following:
- Credit and debit cards
- Net banking
- Electronic wallets
- Smart cards
- Mobile payments
- Electronic fund transfers
- Cryptocurrency
- Buy now, pay later
- Cash on delivery
- Prepaid cards
We will look at some of them later in this blog.
Impact of Multiple Payment Options on eCommerce
So, how important is it to choose the right payment options for your eCommerce business? Offering multiple payment options can have various advantages for your eCommerce business. When multiple payment options are available on the websites, the chance of conversion increases, and the occurrence of cart abandonment decreases. If customers find a convenient way to pay for their goods, they are likelier to buy the product. Limiting the payment methods available online can result in higher cart abandonment. For example, suppose a customer wants to purchase a product and finds that the payment methods available are debit and credit cards. In such a case, the customer is highly likely to abandon their cart if they don’t have either of the cards readily available.
Suppose an eCommerce business owner has multiple payment options available on their website. In that case, customers get a smooth experience during checkout. As a result, they are likely to buy more and return to the website for their future shopping requirements, resulting in a loyal customer base. These varieties of available payment options lend more credibility to the business and increase the website’s traffic.
Popular Payment Methods for Your eCommerce Store
There are various methods of payment that an eCommerce business owner can make available on their website. However, a few have been found to be popular among customers worldwide. While other payment methods are used and are not listed here, you can be sure to find most of these options on any popular e-commerce website.
• Credit and Debit Cards
Credit and debit cards are popular methods of making payments online. Customers also use these methods of payment to fund their digital wallets. Credit cards are also a favorite payment method, as online fraud is less likely. The money is deducted only when you pay the bill, so you can report the fraudulent transaction in advance. For debit cards, the customer requires a bank account to get one. When customers use their debit cards to make a transaction, the money is immediately deducted from their bank accounts. The processing fee on debit card purchases is less than that of credit cards.
• Digital Wallets
If the business owners can provide customers with a way to make payments online without requiring them to enter their sensitive financial information, the checkout process will be seamless and give the customer a smooth shopping experience. This facility to store their card details securely online is known as a digital wallet. Customers log into their wallets and enter their debit and credit card information, which is maintained in a secure environment. Examples of digital wallets include Google Pay and Apple Pay. These wallets provide an extra layer of security as the customers are not required to provide their sensitive banking information everywhere online. Since 2020, digital wallets have gained traction as customers prefer this payment method for ease of payment.
• Cash on Delivery
Cash on Delivery or CoD is a payment method where the customer purchases a product online and pays for it in cash once it is received. This method is ideal for those who want to verify the product’s authenticity before paying for it. This method is also ideal for people who do not have any online payment method available. When customers choose CoD, the risk of fraud, defective products, and online banking errors is reduced. Customers have more flexibility and control over the entire purchase process. Offering CoD options to customers helps a business owner build trust and overcome the wariness over purchasing online.
• Mobile Payment
When customers use their mobile devices, including smartphones and tablets, it is known as mobile payments. This method has become popular recently as it provides security and ease of payment for business owners and customers. One of the ways that mobile payments can be used is to scan a QR code and make instant payments. The customers can also click a payment link and make the payment. Mobile payments can also be used to transfer money between individuals. Customers often get loyalty points, scratch cards, and so on when making monetary transactions.
• Electronic Funds Transfers
Electronic Fund Transfer, or EFT, is a method to digitally transfer payments between bank accounts. Customers and business owners can transfer and withdraw money without using cheques and going to banks. These transfers are encrypted, and the bank verifies all the transactions. This payment method reduces paper usage and eliminates the requirement to print or mail cheques. As a result, this payment method saves the environment, time, and money.
Conclusion:
Selecting the right payment method is crucial for business owners. The more variety available on the websites, the more likely sales from various customers will be. So, if business owners want increased sales, they should keep as many payment methods as possible on their websites. Doing so will help build the brand and credibility. Business owners should ensure that all popular payment methods are easily accessible to customers online.
While attempting to grow your business, if you want to offer diverse payment methods to your customers, contact with XPDEL and we will be happy to help.
About XPDEL:
XPDEL is a leading high-tech provider of Fulfillment and Logistics Services on a mission to enable growth for eCommerce companies. We are futuristic in our vision and constantly work on creating technology that helps us meet customer expectations today and tomorrow. Our wide network of Fulfillment centers enables us to efficiently handle nationwide delivery in the US—same-day, next-day, and 2-day delivery. Being closer to the end consumer, we deliver much faster than others.
