Ten Advantages and Disadvantages of Online Payment Methods
Virtualization of existing physical businesses has become constant in the market. People increasingly tend to buy products online with online payments, rather than moving to a physical store.
Creating a website with online payment does not mean leaving your physical store. An online store means advancement and adaptation to new types of consumers, which dominate the current sales market, so that they are not behind competitors and manage to reach customers in a faster way. Do you want to understand how online payments integrated with your online store can modernize your business and increase online sales further?
Why an online payment platform?
In order for your new online company to have the most positive response possible, we need to know what the best online payment platform and method will be included. The more payment facilities and methods you have in your business, the greater the opportunity to make sales, increasing your site’s conversion rate.
If you want your virtual business to be as successful as your physical store, you must use as many online payment platforms as possible. You can make contracts with card operators or with payment intermediaries. Whatever your choice, it is always necessary to look for as many options as possible, especially if your target audience is more heterogeneous.
To further assist you in choosing the best online payment method, we separate a small list of 10, breaking down to 5 advantages and 5 disadvantages in choosing a card operator or payment intermediary, so you can decide which is best for you…
Advantage: Lower Interest Rates
If you pick the right online payment method you could get lower interest rates than payment intermediaries. While you will need to do your homework with this the saving to your business could be massive.
Disadvantage: You Are Responsible For Any Fraud
While it should never happen you should be aware that many online payment companies will hold the trader responsible for any case of fraud and that could be you have further fees to pay once the matter is all sorted out. So do be aware of this.
Advantage: You Get You Money Instantly
There is no delay if you pick the right payment company with many of them offering almost instant payment and confirmation. This means you as a business get immediate approval of orders and direct payments the moment after a purchase has happened.
Disadvantage: Higher Interest Rates
We have already learned that lower interest rates are an advantage, but what you might not know is some companies will indeed have a higher interest rate than most online banking systems. As with everything relating to your business to read the small print and fully understand that the company is offering.
Advantage: Instant Receipts
If you find printing off receipts a bit of a chore you might be happy to know that many online payment companies will issue an instant receipt the moment an order has been placed. Some will even allow you to print them off the moment an order is placed, but even if it does, it saves you the time of making a receipt yourself.
Disadvantage: You Are Responsible For Ensuring The Equipment
If you have a real-world shop you might need to get any card machines covered by your own shop’s insurance or even your SME insurance. Either way, this will often be part of the deal you signed, but it is a down-side that you might not have thought about.
Advantage: Instant Approval
If you use an online bank it could take weeks to get set up and even accepted in the first place, but with an online card operator, you could get approved there and then and the code made for you and ready to roll.
Disadvantage: Signups Are Required
While most people are more than happy to sign up to a separate payment method there are still some online shoppers that will be put off by it. As a general geographic it is mostly older people who are this way inclined with the younger generation being more inclined to sign up and use them. So do check what type of shoppers your site draws in.
Advantage: Better Deals For Customers
Some online payment operators will also have their own offers and incentives to give to customers. This will often not cost the site using the service a single penny, but it might well lead to more sales. Just as a side note you can also work with these online payment companies to promote your own sale items and offers.
Disadvantage: Customers Will See Offers From Other Sites
While you can get the word out there about your new sale or maybe new items, this also means other companies can do the same thing. You need to make sure your site is the one that stands out and this can often mean doing some homework on the POS.
If there are still doubts about the best form of online payment to use in your e-commerce, don’t hesitate to use operators and intermediaries. This may require less investment, but it will increase the various options that customers must buy.