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5 online payment methods for small businesses to try in 2024

Posted on by darion

Historically, customers had to manually enter their bank or credit card details on the online payment page. Today, there are many online payment methods available through cards and direct banking that dramatically improve the customer experience by reducing friction and reducing transaction times.

As convenience continues to be a key factor in increasing online conversions, it’s important for small businesses to use more online payment options to stay competitive.

Consider trying the following online payment methods on your website:

  • Mobile wallet payments.
  • Payments in the banking app.
  • Biometric-based payments.
  • Buy now, pay later (BNPL).
  • Cryptocurrency.

1. Mobile wallet payments

A mobile wallet is a digital payment application created by third-party FinTech developers that can securely store card and bank information of any brand so you can purchase on any website.

Users download a mobile wallet app to their smartphone or use a pre-installed app like Apple Pay on iPhones and save any bank or card details. To complete a payment, a customer only needs to search for the mobile wallet brand on the checkout page, enter their login details (often via facial recognition if using a smartphone) and confirm the payment.

Mobile wallet payments are more secure because customers don’t have to manually enter payment information on the website.

Characteristics: Transaction fees – can be expensive; Popularity – very popular; Comfort – excellent

Popular mobile wallets on the market include:

  • PayPal
  • Apple Pay
  • Google Pay
  • Samsung Pay

Read more: How to accept credit card payments online for free.

2. Payments in the banking app

Bank app payments are a type 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 allows customers to pay on any website without having to manually enter payment details.

Customers can complete payment by selecting their banking app brand from the available payment methods at checkout and entering their linked email address or mobile number. They will then receive a confirmation code that they can use to confirm the transaction.

Characteristics: Transaction fees – can be expensive; Popularity – growing; Comfort – excellent

Examples of banking applications include:

  • Chasing the cell phone.
  • Capital One Mobile Phone.
  • Bank of America Mobile.
  • American bank mobile banking.

3. Biometric payments

Biometric payments use biometric features such as fingerprints, iris scans, facial recognition, and voice recognition to authorize payment instead of PINs and passwords. Online shopping commonly uses fingerprints and facial recognition to confirm payments from a digital wallet, while voice confirmation is available in the Alexa app.

To use biometric payments, customers save their biometric data in the app, similar to digital wallets, which are then tokenized for security purposes. To complete a transaction, customers only need to scan their fingerprints or face or say, “Alexa, order items from my cart.”

Characteristics: Transaction fees – can be expensive; Popularity – growing; Comfort – excellent

Popular payment applications that use biometric-based payments include:

  • Amazon (Alexa).
  • Apple Pay.
  • Google Pay.
  • PayPal.

4. Buy now, pay later (BNPL)

BNPL is also an application that allows customers to pay for online purchases in installments, while sellers still receive the full proceeds of the sale upfront. The BNPL company deducts installment payments from the customer’s preferred source (credit card or bank). The BNPL app is typically integrated directly with the checkout on the e-commerce site and can connect to the customer’s digital wallet application.

Customers can use BNPL when paying online by entering their card or bank details at the e-commerce checkout and clicking the BNPL option or selecting the BNPL option in the digital wallet during checkout.

Characteristics: Transaction fees – expensive; Popularity – very popular; Comfort – excellent

Popular BNPL providers include:

  • AfterPay via Square.
  • PayPal Pay later.
  • Buy in installments with Shopify.
  • Klarna.

5. Cryptocurrency payments

Despite difficulties due to regulatory concerns, there is growing interest in using cryptocurrencies as an online payment method. Microsoft, Amazon, and AT&T have been accepting popular cryptocurrencies such as Popular Bitcoin (BTC) and Ethereum (ETH) for some time now. You can accept cryptocurrency payments on your website using a cryptocurrency payment gateway.

Consumers have their own cryptocurrency wallets that they use for online transactions, just like a regular mobile wallet. At checkout, customers can select the brand of the cryptocurrency payment gateway on their website. They will then enter their cryptocurrency wallet login details and select the cryptocurrency they want to spend. The gateway converts the exchange rate and displays the final amount. After the Customer clicks the “Pay” button, the transaction is completed.

Characteristics: Transaction fees – can be expensive; Popularity – growing; Comfort – good

Here are the most popular cryptocurrency payment gateways you can use:

  • PayPal.
  • Coinbase Trading.
  • BitPay.
  • Payable in coins.

Read more: Best Cryptocurrency Payment Gateways

How to set up online payment methods

With the right payment processor, setting up an online payment method can be done with a few simple clicks. Below are the general steps for adding a payment method to your online checkout. However, some methods, such as cryptocurrencies, banking apps and BNPL, may require additional steps.

On your website

  1. Connect your payment processor.
  2. Go to your site’s checkout page settings.
  3. Select payment methods.
  4. Click on your preferred payment methods.
  5. Save your settings.

If you’re using a modern website builder, payment processing will often be built-in or integrated with a single click. Mobile wallet payments like Apple Pay are usually an option that you can simply turn on or off – no additional steps are required.

On digital invoices

  1. From your merchant account or invoicing software login, go to your invoices.
  2. Create an invoice or invoice template.
  3. When prompted, add your preferred payment methods.

Read more: The best invoicing apps for freelancers

On payment links

  1. After logging in to your merchant account, go to the virtual terminal or click “collect payment”.
  2. Select the checkout button or shared payment link.
  3. Provide necessary information such as customer, product and total amount due.
  4. When prompted, add your preferred payment methods

Read more: The best trading services

How to choose the right online payment method for your business?

The best online payment method for small businesses should be a combination of two or more methods, not just one, and should balance customer convenience with cost of sales. To do this, analyze the payment preferences of your current online customers and make sure 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.