How to Choose Payment Methods

Think about what kind of methods of payment you can offer to your customers. Let’s take a look at different methods and help you decide.

1. Check out the different payment methods.

There is no better payment method – what you choose deepens on your business. Understand what is payment and how the different methods work.

  • Credit or debit card – this method lets customers pay for products, with a card from their provider. Money from debit cards charge goes directly from the bank account of the customer.
  • Online payments (such as Paypal) – this method lets your customers pay for your products through your website. These payments can be made to be automatic which is very convenient.
  • Cash payment is useful for products with a low cost or if there is no access to other payment methods. For such payments, you will need a cash register. And of course, you advised keeping your money in the bank. Storing a large amount of money by yourself is very risky.
  • Check – payment by check is becoming less frequent as electronic payment methods exist. Checks require more processing to process and may incur fees. You will also have to wait 3 business days to clean them.
  • Money transfer payments – a money transfer instructs a bank, building cooperative, or post office to give you money. Unlike checks, money transfers are prepaid. Because of this, they cannot return due to a lack of funds. But they may bounce back due to other issues, such as suspected fraud.
  • Bitcoin and other digital currencies are like money. People can use them to buy goods just like regular money. The value of currencies can change faster than the value of currencies that are more traditional, like the US dollar.
different payment method

2. Consider your customers.

When picking payment methods, you will need to think about your customers first and what they want:

  • Customer preferences – picking the payment method that your customers are more comfortable with will increase the likelihood that they will pay on time. Credit and debit card payments are the most common. The use of Paywave and other Bank accounts is growing rapidly. Most MasterCard transactions in the store are now contactless.
  • Payment confidentiality – different methods are more confidential. For example, credit card payments are recorded automatically. Some customers may choose to pay in cash for certain products or services, such as medicines, for privacy reasons.

3. Make sure it is reliable.

Your business location is an important factor to consider, as well as your dependence on electricity or telecommunications.

For example, EFTPOS needs electricity and requires access to the telephone network. This payment method will not be available if these systems fail.

4. Assess the risks.

Consider the risks of payment methods. Cash purchases have a higher risk of theft because you have to store the first, and only then can you put money in your bank account for safekeeping. The risk of errors with cash payments also increases because of the human factor.

Dragan Sutevski

Posted by Dragan Sutevski

Dragan Sutevski is a founder and CEO of Sutevski Consulting, creating business excellence through innovative thinking. Get more from Dragan on Twitter. Contact Dragan