When most people think about online payment methods, the first thing that comes to mind is a set of specific payment processors such as Paypal or ClickBank or 2CheckOut. The truth is that there is actually a decision that must be made before you look into specific payment processors is the actual type of payment that you want to accept. So which online payment method is right for your online business? Here is a closer look at each of the most popular payment methods that are currently be used online.
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1. The Basics
While there are a number of options available, the credit card is still the number one form of payment that customers like to use. This is especially true if you include Paypal payments in this category. The biggest benefit to using this payment method is that it is likely what your customers want to use. Additionally, you will have the most options in terms of payment processors as well. While there are a variety of options available, the credit card is and likely always will be the most commonly used and accepted payment method.
2. Electronic Checks and EFTs
Right after credit cards, the most popular payment method is electronic checks and EFTs. In general, these two methods are essentially the same, however there is one small difference. An electronic check essentially generates a paper check that is then deposited in your account and processed like any other check. On the other hand, with an EFT the funds are verified before the sale is processed. This is an important difference because it means that an electronic check can bounce, whereas an EFT will simply not process the sale in the first place. If you are dealing with physical products being sold online this is something to consider.
3. Phone Bill Charges
Another option which is becoming more popular is allowing your customers to charge the purchase to their cell phone bill. In most cases this is done through a payment processor known as eCharge. Instead of paying you directly, the charge gets added to their phone bill. Since mobile phone platforms are responsible for a growing number of online purchases, this payment method is becoming much more user-friendly. Even customer with prepaid phones (T-Mobile prepaid phone plans for example) can charge purchases to their cell phone bill. This really is a very easy method to use.
4. Pre-Paid or One-Click Shopping
Two other payment methods which are still not as well known, but growing in popularity, is pre-paid shopping and one-click shopping. With pre-paid shopping, services like RocketCash are leading the way. With this type of service, parents or individuals can add money to their account which can be used to purchase goods at any time. Since these programs connect with hundreds of merchants, it is convenient for customers. One-Click shopping is based upon the concept of a “digital wallet”. Essentially, Qpass along with the Microsoft Passport technology helps customers reduce the number of steps that it takes to make a purchase, regardless of the method. Once customers sign-in, all of their information is automatically filled out on your site.
In the end, when deciding which payment method is right for your online business, it all comes down to your customers. Whatever they want is what you should give them. In general, the more options the more people you will appeal to.