Historically, customers had to manually enter their bank or credit card information into an online checkout page. Now, a variety of card and direct banking online payment methods are available that drastically improve the customer experience by reducing friction and shortening transaction times.
As convenience continues to be a crucial factor in growing online conversions, it is important for small businesses to explore more online payment options to stay competitive.
Consider trying out the following online payment methods on your website:
The mobile wallet is a digital payment app created by independent FinTech developers that can securely store card and bank information from any brand to buy on any website.
Users download a mobile wallet app on their smartphone, or use one that’s pre-installed such as Apple Pay on iPhones, and save any bank or card details. To complete a payment, the customer only needs to look for the mobile wallet brand on your checkout page, enter their login details (often through facial recognition if using a smartphone), and confirm the payment.
Mobile wallet payments are more secure because customers do not need to manually input their payment information on the website.
Features: Transaction fees – can be expensive; Popularity – very popular; Convenience – excellent
Popular mobile wallets in the market are:
Read more: How to accept credit card payments online for free.
Bank app payments are a kind of digital wallet developed for a specific bank brand. Customers with a banking app can store card and bank payment information from the same bank brand and make payments on any website. Like mobile wallets, a banking app lets customers pay on any website without having to manually enter payment details.
Customers can complete the payment by choosing their banking app brand from available payment methods at checkout and entering the linked email address or mobile number. They will then receive a confirmation code, which they can use to confirm the transaction.
Features: Transaction fees – can be expensive; Popularity – growing; Convenience – excellent
Example of banking apps are:
Biometric-based payments use biometric characteristics such as fingerprints, iris scans, facial recognition, and voice recognition to authorize a payment instead of PIN codes and passwords. For online shopping, fingerprints and facial recognition are commonly used to confirm digital wallet payments, while voice confirmation is available on the Alexa app.
To use biometric-based payments, customers save their biometric data on an app, much like digital wallets, which are then tokenized for security. To complete the transaction, customers must only scan their fingerprints or face or say, “Alexa, order items in my shopping cart.”
Features: Transaction fees – can be expensive; Popularity – growing; Convenience – excellent
Popular payment apps that use biometric-based payments include:
BNPL is also a software application that allows customers to pay for their online purchases in installments while merchants still receive the full sale proceeds upfront. The BNPL company deducts installment payments against the customer’s preferred source (credit card or bank). The BNPL app is typically integrated directly into an ecommerce website checkout and can connect to a customer’s digital wallet app.
Customers can use BNPL while paying online by entering their card or bank information at an e-commerce checkout and clicking on the BNPL option or choosing the BNPL option on the digital wallet while completing the payment.
Features: Transaction fees – expensive; Popularity – very popular; Convenience – excellent
Popular BNPL providers include:
Despite headwinds due to regulatory concerns, there is a growing interest in using cryptocurrency as an online payment method. Microsoft, Amazon, and AT&T have been accepting popular cryptocurrencies such as Popular Bitcoin (BTC) and Ethereum (ETH) for a while now. You can accept cryptocurrency payments on your website with a crypto payment gateway.
Consumers have their own crypto wallets, which they use for online transactions, much like a regular mobile wallet. At checkout, customers can choose the crypto payment gateway brand on your website. They will then enter their crypto wallet login details and choose the cryptocurrency to spend. The gateway calculates the conversion exchange rate and displays the final amount. Once the customer clicks on the “Pay” button, the transaction is complete.
Features: Transaction fees – can be expensive; Popularity – growing; Convenience – good
Here are the most popular crypto payment gateways you can use:
Read more: Best crypto payment gateways
With the right payment processor, setting up your online payment method can be done with a few easy clicks. Below are the general steps for adding a payment method to your online checkout. But, some methods like crypto, bank apps, and BNPL may require extra steps.
If you’re using a modern website builder, oftentimes, payment processing will be built-in or a one-click integration. And mobile wallet payments like Apple Pay are typically an option you can simply toggle on or off – no extra steps required.
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The best online payment method for small businesses should be a combination of two or more, not just one, and should consider the balance between customer convenience and the cost of sale. To do this, analyze the payment preferences of your current online customers and make sure that you have the most popular payment methods available.
For example, younger customers may want to try BNPL payments to manage their cash flow, and some may be interested in using cryptocurrency. Meanwhile, other demographics may want to use a familiar mobile app like PayPal. B2B customers may prefer a banking app to pay directly from their checking account.
