With the rampant increase in digital accessibility, modern consumers are rapidly adopting online purchasing as their default purchasing option. This behavioral change is completely transforming the global landscape and driving companies to offer online payments to attract new consumers.
In the context of the current Covid 19 pandemic, online payment processing has also emerged as a necessity to sustain the requirements of modern consumers in times of limited physical contact.
What are Online Payments?
Online payments are defined as payments made without using cash, cheque, or any other conventional payment method. These payments are made in a secure environment from consumers to payment processors that handle the payment process without manual input.
What is an online payment system in e-commerce?
The increasing usage of digital banking and online shopping has led to an increase in the usage of eCommerce payments along with innovations in technology. Online payment systems in eCommerce are the processes through which websites can receive payment from customers. These payment systems primarily rely on digital payment methods, including mobile wallets, credit cards, debit cards, and other acceptable forms of e payments.
Online payment systems often exist with an integrated payment gateway that allows customers to make payments online using secure digital mechanisms. A number of leading online companies, including Stripe, PayPal, and Clover, provide businesses with the ability to receive online payments through their built-in systems instead of having to develop their own custom payment gateway.
Paperless payments are transforming the payment processing landscape by reducing paper management, transaction, and human resources cost. The designed systems are highly user-friendly and offer faster transaction processing than consumers.
What is the role of the online payment system in e-commerce?
Online payment systems can be considered to be the backbone of eCommerce operations. These systems allow business owners to receive payments from consumers around the world. Aside from widespread payment acceptance, online payment systems also allow businesses to expand their reach and continue functioning throughout challenging global conditions.
Examples of such scenarios include the Covid 19 pandemic, which limited conventional sales due to imposed distancing requirements. The ability to receive online payments allows businesses to sustain themselves and diversity their business avenues.
Even though payment-on-delivery payment options are offered by some eCommerce stores, the wide majority of digital revenue for eCommerce stores is generated through online payments.
Online payment systems also simplify the transactions for consumers by allowing them to make payments without having to physically pay using conventional financial instruments.
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What Are the Different Types of E-Commerce Payment Systems?
With technological innovation, the methods of digital payments have become increasingly sophisticated to provide enhanced protection to consumers. Starting from the credit card transactions in the early 90s, today, we have a plethora of digital products that are simplifying consumer banking and allowing customers to seamlessly carry out their desired commercial operations.
Here are some of the most commonly used types of eCommerce payment systems：
Net banking is the process of making digital payments directly from commercial banks. Similar to debit cards, this eCommerce payment system relies on the money already present in the customer’s bank account to go through with the transaction. Net banking does not require consumers to have a credit or debit card while availing of the net banking facility.
One of the most common ways of making online payments today is through the usage of smartphones. Thanks to embedded payment wallets and contactless payment options, smartphone payment systems are one of the most common eCommerce payment systems today that allows customers to make purchases simply from the touch of a button. Smartphone payment systems are often integrated with payment details and associated options so the business can conveniently receive the payments made to the company.
Buy Now Pay Later (BNPL)
BNPL payment systems are becoming the most popular choice of consumers in 2021. This eCommerce payment system allows consumers to split their payments into multiple interest-free installments. Leading stakeholders in the BNPL space, including Klarna and Amazon, are transforming the conventional eCommerce landscape by allowing customers to make payments based on their own personal calendars. The ability to split payments also encourages customers to enhance their purchasing volume.
E-wallets allow consumers to store their payment sources in a single secured wallet. These wallets eliminate the requirement to have keyed information at every purchase. The ability to safely manage payments across the internet is being actively used by eCommerce stores through leading companies like Google and Apple.
These innovative systems are helping businesses revamp their existing strategy and attract an entirely new pool of customers that are used to blazing-fast payment processing. The changing dynamics are also requiring businesses to consider eCommerce an integral part of their strategy.
To navigate this aggressive lean towards digital payments, it is important for your business to adapt and offer modern payment solutions to outcompete your competition. The ability to seamlessly manage payments helps businesses scale and grow to the next.
If you don’t have all the required information, considering 3rd party solutions can be a great way to guide you through the process and make the right decisions. Selecting the right eCommerce payment system can help you save a ton of money and enhance trust with your clients.
Oceanpayment is the perfect partner to help you figure out the right solution for your needs. We’re experts in integrated digital payments and offering innovative solutions to companies around the world. Our team of qualified experts works around the clock to simplify your journey and help you implement the best solution.
To learn more about Oceanpayment and our digital services, check out more at https://www.oceanpayment.com/.