How to choose the right payment method or payment method for your type of business

payment methods and techniques

What is a payment method and payment method

The term "payment method" covers the various options that customers can use to conduct transactions when purchasing goods or services. Whether it's an in-store or online purchase, there are a variety of payment methods available. The most common methods include cash, credit and debit cards, gift certificates, and mobile payment systems. Customers can choose the most convenient payment method depending on their preferences. These payment options simplify the shopping process and ensure security when exchanging funds between buyers and sellers.

Advantages of payment methods

The benefits of providing a variety of payment methods for small businesses are huge for both owners and customers.

  • Increase sales: Studies show that one in ten shoppers abandon their carts if the payment methods offered are limited. Providing a variety of payment options can reduce barriers to purchase and increase sales.
  • Increase customer satisfaction: Giving customers the choice of payment methods that are right for them improves customer satisfaction, which is important for establishing long-term relationships and encouraging repeat purchases. Customers appreciate the ability to choose between credit cards, mobile apps, and cash.
  • Reducing the risk of fraud: According to research, fraud losses in the e-commerce industry continue to rise. To reduce the risk of online payment fraud, businesses can choose the payment methods that are best suited to minimize such risks. A high level of customer authentication can reduce the likelihood of fraudulent transactions.
  • Competitive advantage: In today's competitive environment, it is important for businesses to stand out from their competitors. Offering a variety of payment options can be a key factor in turning a potential customer into a regular one.
online payment methods and techniques

Types and approaches of different payment methods

In the world of card payments, customers have a variety of options, ranging from debit cards to credit cards, as well as contactless chip and PIN payments. Below is an overview payment methodsavailable to customers when using the card.

Debit card

A debit card is linked to the holder's bank account and allows direct withdrawals from that account. When you try to make a payment or withdraw money from an ATM, the funds will be available only if there are sufficient funds in your account. There are three main types of debit cards:

  • Visa
  • Mastercard
  • Maestro

All of these types of debit cards function in a similar way: the customer makes a payment with the card through a terminal (via chip and PIN, contactless, by phone) or online, and the funds are withdrawn directly from their bank account. This usually happens the same day, but in some cases it can take 24 to 72 hours.

Credit card

Credit cards allow you to make purchases using funds that must be repaid later, unlike debit cards, where funds are withdrawn directly from your bank account. When a customer receives a credit card, he or she is given a credit limit, which is the maximum amount he or she can spend. When the card is used, the customer agrees to repay the remaining balance, sometimes with interest. There are three main credit card issuers:

  • Visa
  • Mastercard
  • American Express

As with debit cards, credit cards allow customers to make purchases online, using chip and PIN, contactless technology, or phone payments. Credit cards provide additional benefits for customers by allowing them to spread the cost of expensive purchases into more convenient payments over time. However, the use of credit cards also comes with the risk that customers may spend money they don't have and face difficulty repaying their debts. Credit and debit cards can be a convenient alternative to cash. Studies show that people spend 100% more when they use credit cards instead of cash. In addition, for businesses, using cards avoids the risks associated with accepting counterfeit money or having to keep large amounts of cash on hand.

Prepaid card

Prepaid cards are an alternative to cash, debit and credit cards. They are used for online and in-store payments using a chip and PIN, as well as contactless payments. However, unlike debit and credit cards, you do not need a linked bank account to use a prepaid card. Instead, the card already has funds on it that can be replenished as needed. These cards provide the flexibility of other types of plastic cards without the risk of accumulating debt. However, prepaid cards may incur additional fees. By only reloading a prepaid card with a certain amount, the user can easily control their spending. That is why such cards are often chosen by young people who do not yet have their own bank account. The minimum age for a prepaid card depends on the provider, but such cards are available even to children 6 years old and older.

Contactless payment

Contactless payments are a convenient payment method available on most currently issued plastic cards. They allow transactions to be made without the need to enter a personal PIN, making the payment process quick and convenient. Contactless payment technology allows data to be read from the card from a short distance, making the payment process as easy as possible for customers. Due to its simplicity and speed, contactless payments are becoming increasingly popular among consumers. According to research conducted in the UK, almost half of all shoppers prefer to use this payment method. In the last 2 years, the number of transactions made with contactless cards has increased by 45%. Contactless payments can be made using credit, debit, or prepaid cards, as well as mobile devices. However, there are concerns about possible misuse, so contactless transaction amounts are usually limited to a certain level, for example, up to 100 euros.

Mobile wallets

Mobile wallets, also known as e-wallets, are applications that store payment card information on smartphones or other supported devices. They turn devices into convenient contactless payment tools by allowing transactions to be made using compatible terminals. This method may include additional security measures, such as biometric verification, such as fingerprint scanning or face recognition, to ensure the security of contactless payments. The technology is based on the use of radio frequency identification (RFID) and near field communication (NFC). Examples of mobile wallets include Apple Pay, Android Pay, and Google Pay, which, according to our research, are the second most popular payment methods: 20% of all shoppers prefer mobile payments.

Payments over the phone

People can also provide their card details while talking on the phone to make a payment, which is a great way for you to accept payments from afar. This works using a virtual terminal: customers provide their details and you insert them into the terminal on your side. Virtual terminals are equipped with the latest security features and can be used with all major credit and debit cards. While it is a convenient option for businesses to accept payments without presenting a card, there are concerns that phone payments do not have the same level of security as other methods.

Internet (online) payments

With the increasing speed of the Internet and the proliferation of digital technologies in everyday life, it is not surprising that online payments are becoming increasingly popular. This trend is confirmed by the analysis of the number of transactions among our merchants: in the first quarter of 2022, the volume of online payments increased by 21% compared to 2023.

Online banking

Online banking or internet banking allows you to make various types of payments. Users can directly transfer funds from their account to others, provided they have online banking and the recipient's correct payment information. With the help of online banking, users can set up direct debits, recurring and one-time payments to family members and friends, as well as to companies. In addition, online banking allows you to receive funds from other users. The advantages of online banking include free of charge, security and convenience of sending and receiving funds from reliable sources. All transactions are carried out electronically, which allows them to be carried out remotely via smartphone or computer, avoiding the need to handle physical cash.


Using email is a simple and convenient way to pay for goods online. The seller (i.e. you) creates a special link and sends it to the buyer. Once the buyer opens the link, they are redirected to a secure payment page where they can complete the transaction without any further interaction. Payment links accept all major credit and debit cards, providing you with an easy solution for paying for goods or invoices. It's important that your emails look legitimate so that customers feel confident in handing over their payment details.

Payment by QR code

Payment with QR codes is the process of scanning a special QR code on a customer's mobile device, which redirects them to a secure online payment page. Here the customer can create his order and make payment using a credit or debit card or mobile wallet. QR codes are widely used in various fields, including the hospitality industry, where they help to reduce contact between staff and customers, as well as reduce congestion during peak periods. Since visitors can place orders at any time, it also helps to increase table turnover and sales.

Payment in cryptocurrency

Cryptocurrency is a digital form of currency that uses cryptographic methods to ensure the security of financial transactions. Unlike traditional payment methods, such as debit or credit cards, cryptocurrencies operate on decentralized networks known as blockchains. A blockchain is a continuously growing database that stores data about every crypto transaction, including timestamp information. When using cryptocurrency for payment, the customer transfers a certain amount of the selected cryptocurrency from his digital wallet to the merchant's wallet. This transaction is recorded in the blockchain, which ensures transparency and security. Cryptocurrency is a relatively new payment method compared to traditional methods, but its high reliability and confidentiality raise certain regulatory challenges. At the same time, due to advances in blockchain technology and controls on misuse, cryptocurrencies are becoming increasingly widely recognized as a means of payment for various legitimate purposes.

While not all business models and audiences can use cryptocurrency, it offers significant advantages, such as not needing a traditional bank account. All that is needed to exchange funds between a business and a customer is access to the Internet and a digital wallet.

How to choose the right payment method for your business

There are a number of factors to consider when deciding on the most appropriate payment method for your business. A variety of factors, including your business location, business model, and the preferences of your audience, play an important role in determining the best payment methods. Here are the key aspects to consider when choosing the most appropriate payment method for your business:

  • Location: Where is your business located and what are the preferences of your target audience? Local and regional differences can affect customer preferences for payment methods.
  • Business model: Your payment method should match your business model. For example, companies offering subscription services may need an automatic payment system.
  • Purchase methods: Where and how do your customers prefer to shop? Online stores may require different payment methods than brick-and-mortar retailers.
  • Security and compliance: It is important to ensure that payments are secure and comply with data security standards.
  • Scalability and integration: Your payment methods should be flexible and easily scalable to meet the needs of your growing business.
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