There are many different ways to accept payments nowadays. By exploring different payment solutions, you can give customers more options and potentially increase sales. Not all of these payment methods are relevant to every type of business model, but they could still be worth considering if you’ve been thinking of expanding your payment solutions.
Cash
Cash is the oldest form of payment. Many businesses still accept cash because it doesn’t have to be kept in a bank, requires no merchant fees to process and is easier to tip anonymously. That said, cash has downsides such as being less hygienic, easy to miscount or misplace, and potentially a security risk to have on site (hence why some businesses have gone cashless). Cash is also typically not suitable for online businesses.
Debit card
All modern businesses should accept debit card payments. You can accept debit card payments in person, on the phone or online – they’re a secure, convenient and digitally trackable form of payment. Just be wary that they do incur small processing fees and payments can be delayed.
Credit card
When it comes to accepting larger payments, it can be beneficial to accept credit card payments. This allows customers to borrow money to pay for purchases, while also collecting rewards and providing greater security than a credit card. Credit card payments do however incur larger fees for the vendor than debit cards – take your time to compare credit card processing companies.
Cheque
Cheques are slightly old-fashioned now. While some customers still like to use them as an alternative to cash for larger payments, there is a risk they can get lost or that payments can bounce if they don’t have enough money in their account. Cheques can be cashed in via banking apps nowadays, but many companies still don’t accept them.
Bank transfer
If you don’t have a card machine, you can still accept payments electronically via bank transfer. This requires giving customers your bank details and is typically done via an invoice. Bank transfers may have to be chased up if a customer doesn’t pay immediately, which can make them potentially inconvenient for companies with high volumes of sales.
Gift cards
Gift cards allow customers to pre-load money onto a card to be given to someone else as a gift. If your products/services are the type of thing someone might buy as a gift, it could be worth selling gift cards. A major benefit of gift cards is that the customer pays for them upfront and you receive the money whether or not the recipient uses the gift card.
Loyalty points
If you want to encourage return customers, it can be worth setting up a loyalty points scheme. This allows customers to collect points with each purchase that can later be spent to get discounts and freebies. Loyalty points can be collected via a physical card, a loyalty app or an online shopping account. It’s important to not give away too many points with each purchase so that they are still profitable.
Coupons
Coupons are discount vouchers that can be given to select customers. They can be given to new customers to encourage return business, as a birthday gift, as a reward for loyalty or as a refund for bad service – usually sent via email or in the form of physical vouchers.
Payment plan
Allowing customers to set up a payment plan allows them to pay in installments. This is worthwhile providing for large purchases as an alternative to credit cards. You can add interest to installments or charge no interest. The downside of payment plans is that you may have to chase up customers that don’t pay each installment on time.
Third-party finance
Finally, there’s the option of third-party finance. This involves working with a lender who can provide loans to customers. The lender pays you the full amount upfront and you don’t have to do any chasing up. However, the lender may require commission from each payment, which can impact profits.
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