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The Complete Guide to Online Payment Methods: Types, Benefits & Optimization Tips

Boaz Gam

Boaz Gam


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8 min
Article content
  1. The Advantages of Accepting Online Payments
  2. Why Offer Different Online Payment Options?
  3. The Most Popular Payment Methods in 2023 & Beyond
  4. How to Accept Payments Online?
  5. A Full Range of Online Payment Methods On a Single Platform
  6. FAQ

Types of Online Payment Methods and How to Accept Them

Nowadays, it’s difficult to imagine a successful and rapidly growing business that doesn’t accept payments online. What’s more, simply enabling customers to make purchases via the Internet is not enough to ensure a smooth shopping experience. Modern customers expect fast checkout, a variety of payment methods, frictionless transactions, and so on.

In this comprehensive guide, we will go over all the critical aspects of processing online transactions and help you navigate through the nuances related to it.

The Advantages of Accepting Online Payments

Types of Online Payment Methods and How to Accept Them

Theoretically, even if you sell products and services in a web store, it would be possible to operate without processing transactions online. For instance, you could get away with sending bills and waiting for a check in the mail. However, it sure does sound old-school, doesn’t it?

While offline payment methods still exist, some are being gradually replaced by their digital counterparts due to the plethora of benefits the latter offer, such as:

  • Access to a wider audience. When a business accepts online payments, they make shopping at their store accessible for a large number of customers.
  • Optimized payment process. Paying online is extremely easy and can be done through a variety of mobile devices, promoting a positive customer experience.
  • The ease of setting up subscriptions and memberships. If you receive recurring payments, there’s nothing better than setting up an online subscription plan and ensuring comfort for both you and your customers.
  • Faster receipt of funds. A lot of online payment methods these days get processed nearly instantly, sparing you the need to issue an invoice to reach the customer.

As you can see, processing online transactions is an advantage of its own. However, accepting a wide range of payment methods takes merchants a step ahead.

Why Offer Different Online Payment Options?

Types of Online Payment Methods and How to Accept Them

While some businesses can do just fine with a single payment option, the vast majority of merchants tend to implement multiple methods. But why so?

According to research, 8% of customers abandon an online cart due to a lack of payment options, while 19% left because they didn’t trust the website, which is often the case when a person doesn’t find a payment option they’ve tried before1.

Providing multiple payment methods comes with such practical benefits like:

  • Geographical availability. Offering local payment methods alongside the globally recognized ones enables you to cater to an international audience effectively.
  • Functional backup. It sometimes happens that payment services go down or become temporarily unavailable for some locations. Having several alternatives to those ensures that the sales won’t come to a halt.
  • Customer satisfaction. Providing customers with a mix of many payment options makes them more satisfied with the shopping process and is known to boost retention rates.

Clearly, there are plenty of advantages when it comes to providing a good selection of payment methods. But which ones will your store benefit from the most?

The Most Popular Payment Methods in 2023 & Beyond

Types of Online Payment Methods and How to Accept Them

There are many payment options available on the modern market. However, providing all of them at once could be costly due to fees and ineffective because of complex processing and regulatory requirements. Thus, it’s important to carefully identify which payment methods match the business’s needs and target audience the best.

Here is an overview of the most used payment methods nowadays:

  • Debit and credit cards - Bank cards are the most popular payment method worldwide and are typically offered as a default option on eCommerce sites. All that the customer has to do to use this payment form is enter their full name and details, such as the card number, expiry date, and CVV code.
  • Netbanking - It is a payment method also known as Internet banking. It is very similar to making a purchase using credit cards, except that the customer doesn’t have to type in all the payment details. Instead, they log in to their online bank using a laptop or mobile device, and the sum gets debited instantly from their account.
  • Direct debit - With such a payment form, merchants get the customer’s permission to withdraw money directly from their account on a specified date. In eCommerce, this method is often used for subscriptions.
  • Digital wallets - Mobile wallets are becoming increasingly popular, especially among younger generations. To pay via a digital wallet, the consumer has to link their credit card to a provider of choice (for example, Apple Pay, Google Pay, PayPal, etc.). After that, the details will be securely stored in the mobile wallet, so the user won’t need to have a physical wallet and credit cards at hand every time they wish to make a purchase.
  • Buy Now, Pay Later (BNPL) - It is a method that enables merchants to receive the money for an order upfront while the customers pay for it in installments. BNPL became increasingly popular during the COVID-19 outbreak and keeps gaining prominence in post-pandemic times, so it’s good to offer it as an option. What’s more, this online payment form tends to increase transaction values and boost conversion rates at checkout.

And there you have it - an overview of some popular online payment methods used by customers across the globe. However, note that there is a wide variety of local and alternative options, and new solutions arise on a regular basis.

Besides, despite the increasing popularity of digital and mobile options, cash continues to play an important role in various economies. What’s also interesting is that in some places, customers adjust to global digitalization trends while not straying too far from cash. One example is Boleto - a Brazilian cash voucher, which is used by many locals when they need to pay for goods and services.

How to Accept Payments Online?

Types of Online Payment Methods and How to Accept Them

There are two ways in which you could start accepting payments online:

  • By setting up a merchant account and a payment gateway
  • By partnering with an all-in-one payment processor

Let’s take a closer look at both of these options:

1. The “DIY” Method

If you are a do-it-yourself type of person and would like to set up the payment processing system from scratch, you will need to take care of two key elements:

  • Merchant account. It is a bank account that enables merchants to accept credit and debit card payments by temporarily holding funds until they are transferred to their business account.
  • Payment gateway. It is software through which the website will link to one or more of the processor networks. It allows customers to submit card details, notifies you whether the transaction is approved by the cardholder’s bank, and forwards the charges for settlement.

While it is definitely an option that you can opt for, there may be many faster and simpler ways of setting up online payment processing for a store.

2. Collaboration With a Financial Service Provider

Realistically speaking, not everyone may have enough time to set up payment processing on their own. That’s why many business owners choose to turn to a payment platform provider to minimize those hassles and get a ready-made solution.

These companies act as intermediaries between merchants and banks by forwarding them from the cardholder’s account to yours. These financial service providers typically perform the functions of both the merchant account and the payment gateway, sparing you the need to set up those elements.

What’s more, in many cases, opting for a comprehensive solution may mean that you do not have to worry about complying with the current regulations, like PCI DSS (Payment Card Industry Data Security Standard), as you would not be storing sensitive customer information.

On top of that, you may be offered additional services to customize the solution, like subscription billing, fraud management, and beyond.

A Full Range of Online Payment Methods On a Single Platform

Types of Online Payment Methods and How to Accept Them

The advantages of outsourcing a holistic payment solution are undeniable. However, not every platform has the capacity to offer a full package of those services tailored to a specific business’s needs.

Payneteasy is today’s leading payment service provider that delivers a wide array of solutions for merchants, banks, PSPs, financial institutions, and beyond. We provide our customers from across the globe with software that is fast, secure, customizable, and easy to integrate.

For instance, our white label payment gateway is an end-to-end, ready-to-use, PCI DSS-compliant solution that will save you plenty of time, effort, and development costs while providing a plethora of benefits like:

  • Absence of iFrames and redirects
  • 99.997% uptime track record
  • 150+ customizable fraud filters
  • Fast and easy integration
  • Full technical support
  • 3-D Secure verification
  • Customer behavior analysis
  • User-friendly back office

Our gateway supports a variety of payment methods, ensuring the best shopping experience for your customers.

Reach out to us today to start effectively processing transactions, attracting new customers, and increasing business revenues in no time!


How to accept payments online?

To accept digital payments, you will need two key elements: a merchant account and a payment gateway. While some choose to set them up on their own, others opt for a faster and more convenient option, which is outsourcing a customizable payment solution, such as Payneteasy. Thanks to our white-label payment gateway, you can start accepting digital payments almost instantly..

What are the different payment methods online?

The eCommerce landscape features plenty of payment methods. Some of the most popular options are:

  • Debit and credit cards
  • Online banking services
  • Direct debit transfers
  • Buy Now, Pay Later (BNPL)
  • Digital wallets

Besides, there is also a variety of established and emerging local and alternative payment options, which are worth taking into account.

What is the safest way to accept payments?

No method is universally accepted as the safest one. However, you can rest assured that you are processing transactions in a secure way if you carefully follow up-to-date security standards while also dealing with financial service providers that are reputed and experienced. Payneteasy offers top-notch solutions with security as one of its key focal points.

Which payment method types are most commonly used in online transactions?

Despite the fact that new solutions emerge continuously, bank cards remain the most popular payment method worldwide. According to research, on average, every adult person has three credit cards2.

1 - Baymard Institute - 48 Cart Abandonment Rate Statistics 2022
2 - Forbes Advisor - 9 Interesting Credit Card Statistics

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