Do you offer personal services or do freelance work? If so, then it can be even more important to accept payments online. That way, you and your customer are able to complete the transaction without being physically present with each other.
If you’ve traditionally done business in-person or if this is your first time doing any type of business, then it may seem like a daunting task to figure out how to accept payments online.
Let’s break down the process for accepting payments online into steps and also examine some popular ways that many people use to pay for goods and services online today!
What is Online Payment?
In its most basic form, online payment is the transfer of money from one party to another through a third-party service.
In this case, you would be the first party and your customer would be the second party while an online payment provider or financial institution would act as that middleman between both parties. An example of how it works can be seen in eBay’s checkout process.
Why is it important?
If you offer personal services or do freelance work, it can be even more important to accept payments online. That way, you and your customer are able to complete the transaction without being physically present with each other.
It’s also good to use online payment when you have a large number of orders all arriving at different times. You can get paid for the first order and then wait until your customer receives their product before collecting on any other transactions.
Online Payment Gateways
To accept online payments, you’ll first need to set up an account with a payment gateway. There are many different options available for this type of service but the most popular include PayPal and Stripe.
What are some alternatives?
If setting up your own merchant account is not something that interests or excites you, then there are plenty of other options available to you through which you can get your payments straight into your business checking account.
Many large eCommerce platforms offer the option for their users to accept payments through third-party intermediaries such as PayPal, Braintree, or Stripe. These services are easy to set up and use but they do come at a price so be sure to look into all your options before settling on one.
What are the different ways to accept payment online?
There are three different ways that you can receive electronic payments from your customers:
1. Credit and Debit Cards
If you don’t already have a merchant account, then accepting credit and debit cards is one of the easiest ways to get started.
With this method, your customers will be able to use their card (debit or credit) at checkout without entering any private information such as bank account numbers.
This type of payment requires that you have a secure payment gateway and an SSL certificate. You will also need to make sure that your website is PCI compliant in order for you to accept credit cards online.
Letting customers pay by direct debit means they'll enter their bank account number, sort code, and account name into the appropriate fields during checkout.
This is a great option for customers with a good history of on-time payments or who do recurring billing, such as memberships or subscriptions.
For customers who don’t have a credit card or debit card, using an eCheck is another way to pay for your goods and services online.
An e-check allows the customer's bank account to be debited electronically for payment for any item they purchase through your website meaning that there are no physical checks involved.
3. Mobile Payments
These days, people are using more of their mobile devices than ever before to complete online transactions.
There are many different types of payment apps that can be downloaded onto your phone or tablet and used at checkout on your website with ease!
What is the process for accepting payments?
Once you’ve identified which type of electronic payment will work best for your business, you can proceed with setting up a merchant account.
In most cases, all that’s required is filling out an application and signing some contracts to get started! You will then be able to start accepting payments from customers immediately after the process has been completed.
What are the benefits of online payment?
There are several benefits to accepting credit and debit cards as well as other forms of fast digital money at checkout:
You can accept online payments from anywhere and at any time, as long as you have an internet connection. This is extremely beneficial to business owners who are on the road a lot or have other commitments that take up their time.
Accepting payments online is more convenient for customers too, who will appreciate the fact that they don’t have to carry cash or physical checks around with them in order to make a purchase.
Speed is the name of the game when it comes to digital payments. Since transactions are completed so quickly, there’s no need for customers to provide their payment information more than once.
With electronic payments, your funds can be available in just hours after you receive payment from the customer - meaning that there’s no waiting around for paychecks anymore! This means more freedom and flexibility to run your business.
Security is the biggest reason why customers choose to pay for goods and services online. All major credit cards offer fraud protection, identity theft insurance, purchase security guarantee, etc.
These benefits give peace of mind to both customers and businesses, which is why more and more people are turning to online payments.
Credit card payments are extremely secure since sensitive information is never shared with your customers or employees during the transaction process.
Your transactions and account information will be kept completely confidential so you don’t have to worry about anything being compromised.
4. Customer Retention
Customers are more likely to keep coming back if they know that their payment information is already saved on file so all they have to do each visit is click “check out”. This is much easier than having to re-enter their credit card information each time.
Retaining customers is beneficial to your business in many ways because it means you’ll have fewer customer support calls, fewer chargebacks, and more repeat customers.
5. Competitive advantage
Competition is everywhere so it’s important to find ways you can stand out from the crowd. One way of doing this is by providing your customers with the best shopping experience possible.
Offering online payment options to your customers makes it easier for them to complete purchases and will give you an edge over other similar businesses.
You can also use online payment to encourage more purchases since customers are less likely to leave your site once they’re already on it.
The ease and convenience of accepting electronic payments set you apart from your competitors.
You can stand out as an expert in payment processing by offering this service to your customers, which will help gain their trust more effectively.
What happens if something goes wrong?
If you run into any problems during the processing of an order or payment online, there are many customer service options available to you:
1. Antifraud systems
If a charge is disputed, your bank will help mediate and resolve the issue for both parties. This system is extremely helpful to merchants as it ensures that customers who use credit cards are protected from fraud.
It can also help you identify potentially fraudulent transactions before they even go through.
2. Chargeback protection
If you’re running an eCommerce business, you know how frustrating it can be when customers dispute charges after they receive their products.
This can lead to long and difficult processes in order to finally get your money back, which is why you should center all of your security efforts around preventing these disputes from happening in the first place.
Chargeback protection is a great service offered by most banks that will protect you against the cost of chargeback fees and ensure that you’re reimbursed for any lost sales revenue.
3. Customer service
If any issues do come up with your processing company, there are many support options available to you. Most companies have 24/h phone, email, or live chat customer service that can help resolve problems quickly and easily.
The worst that can happen is that your payment will be declined by the credit card issuer. This shouldn’t be a huge deal because most customers have more than one credit card to choose from.
If you are receiving too many declined transactions, it might be due to your processor or account settings.
If you run into any problems, your processor should be able to help you out by either resolving the issue or offering alternative payment options for your customers.
The best way to avoid errors and problems is to keep your account settings updated and accurate at all times, so there’s less risk involved with processing payments.
There are many different ways to accept online payments and the best one for you will depend on your business model, how much work it is going to take, and what kind of audience you’re trying to reach.
Decide which method of accepting online payments is the best for your business and start offering this service to increase customer retention.
With such a large number of customers already preferring to make purchases online, it’s important that you provide this service in order to stay competitive.
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