Multiple Payment Methods – Why is it Fundamental to E-Commerce Success? | National Crowdfunding & Fintech Association of Canada

May 24, 2022 FinTech and Alternative Finance, Fintech International, Fintech Services, Innovation and Resources, Payments, Transfers, Rewards No comments

Multiple Payment Methods – Why is it Fundamental to E-Commerce Success?

Guest Post | May 24, 2022

Introduction

We know for a fact that digitalization has taken over the world. As a result, digital payment usage is booming like never before. These days, there are plenty of payment options available. Whether it be getting salaries, purchasing something, or ordering food, most of the population is interested in digital payment, thanks to the seamless deposits and withdrawals.

With this growth and flexibility in payment methods, businesses need to keep up with the trend and expand their payment options. Otherwise, they might lose a large demographic for insufficient payment facilities and eventually face devastating business loss.

How Multiple Payment Options Generate More Revenue?

With huge diversity among customers, payment preference is bound to vary. Therefore, multiple payment methods in e-commerce can lead to an increase in revenue. Lack of options in payment can cost you losing potential customers.

On average, 70% of customers abandon their cart on e-commerce sites. Among them, 8% do so due to the lack of payment options, and the percentage is 42% in the US. This percentage can be crucial for many businesses. Building trust with the customers and providing them with what they want is essential to achieving e-commerce success.

1. Attracts Diverse Customers

E-commerce sites are dynamic these days to reach out to a larger target audience. As many people are becoming interested in e-commerce as customers, the diversity in payment methods is also evident. However, if e-commerce businesses cannot satisfy the payment need of the larger audience, then there will be no progress.

For instance, a computer user can be comfortable using the debit/credit card method on an e-commerce site. The site might be dynamic and catered to suit the needs of mobile users as well. However, a mobile user might be comfortable paying on mobile banking, but if they do not get the mobile payment option at the check-out, they are more likely to abandon their cart.

To satisfy the needs of customers who are comfortable with varying payment methods, multiple payment options in e-commerce are necessary. A survey among US consumers shows that 26% are not willing to adopt a new payment method.

2. Convenient for Customers

More options are more convenient for customers. They might be using several payment methods, and when they find all of their desired choices, they are more eager to purchase. Then again, if customers are having some issues with one payment method, they can use another one.

Otherwise, they will just leave the website without making any purchase. Options are payment methods that decrease the dependency on a particular payment method. Therefore, for more conversion, multiple payments are a must.

Customers want a fast and easy transaction. If easier options are not available, customers feel less interested. About 58% of US customers stop at the check-out process due to the complications in the check-out. This is more than half the customers, which means the effects can be drastic for a business.

3. Keeping Up with Competitors

The e-commerce world has become incredibly competitive. Unless a business adapts to the latest requirements of customers, it will fall behind in the competition. There is no denying that one of the key requirements in e-commerce these days is options for payment.

See: UK Proposes Regulations That Would Recognize Stablecoins As A Form Of Payment

To engage with customers and generate sales, a business has to understand the needs of their customers, especially with payments. Ultimately, a company will be successful once the customer pays for a product. Eventually, the business will flourish and go ahead of its competitors.

4. Better Tracking System

Gaining customers' trust by providing a secure and hassle-free payment method is essential for the growth of a business. These payment methods are transparent, easy to get a solution when some problem occurs, and easy to get refunds. Different people can find other payment options safer and easier. Therefore, there is no alternative to having multiple options to satisfy a larger demographic.

Different Types of Payment Methods

Multiple payment options are a must for e-commerce success. However, with thousands of options available, a business cannot offer all of them. The key is to offer the most popular payment methods from each category. Then again, not all payment options will be suited for your business.

The variety of payment methods available these days can be divided into four categories. They are as follows.

Cash Payment: The good old cash payment is still available in many cases. This method is used for food-delivery services, ride-sharing services, etc. Although, this method is becoming obsolete in the e-commerce sector.
Credit/Debit Card: Paying with a debit or credit card is considered the traditional way of payment. This option is a reliable and often used one by many customers.
Internet Banking: Many banks have their own banking system that can be accessed through electronic devices, such as computers or mobile phones. Internet banking is also quite popular for making payments for e-commerce sites.
Digital Wallets: Digital wallets or e-wallets store your information securely and allow hassle-free financial transactions. You do not need to insert your information every time you purchase something. Paypal, Apple Pay, and Goggle Pay are a few of the popular digital wallets.
Mobile Apps: Mobile payment allows you to pay through an app on your phone. You need to install and provide the necessary information to the app, and then you can use it to make payments.
Buy Now Pay Later (BNPL): This payment method is fairly new. This is like an installment where you get products and make the payment gradually.
Cryptocurrency: Bitcoin, Solana, Ethereum, etc., are some of the popular cryptocurrencies. In some specific e-commerce sectors, cryptocurrencies can be used as a method of payment.

To Conclude

Undeniably, different payment methods in any e-commerce make more customers purchase. Also, they are more likely to become loyal customers. This increases revenue. Therefore, multiple payment methods are crucial for e-commerce success. Hence, provide your consumers with multiple payment options and witness it having a positive impact on the revenue of your business.

NCFA Jan 2018 resize - Multiple Payment Methods – Why is it Fundamental to E-Commerce Success? The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org