Irrespective of the business type and industry, the entire business cycle revolves around getting paid. Making money is the primary intent behind starting or running a business. But with changing times, how you accept payments from your customers does make a difference.
From the age-old barter system to paying for things in cash, the business ecosystem has evolved considerably. What has not changed over the decades is the value and role of money in our lives. Now, the next big thing in the world is digital payments.
Consumers prefer paying vendors digitally without having to deal in cash only. Besides this, modern-day trade expects large payments to get settled quickly over long distances and with the least transaction cost.
Using cash as a medium of payment is ingrained in our habits. However, digital payments are gradually causing a paradigm shift by saving our time and efforts to make payments online and offline.
The best part is – you need not worry much about the choice of digital payment methods. There are a plethora of payment methods available to help you accept online payments for your business. Whether you run an offline or online business, accepting payments online via different payment methods should be a priority.
Offering more than one payment option can help in attracting more customers, allowing them to make larger purchases easily. However, it is important to understand the advantages of each payment method before you start using them for your business.
What are the different payment methods for businesses in India?
Credit cards are issued by different financial institutions (banks) to individuals to enable them to borrow funds up to a certain limit. Cardholders can use the cards to make online and offline purchases and pay the spent amount back within the stipulated period without penalties.
The pre-approved limit of credit cards is determined by the chosen bank based on his/her credit score or CIBIL. In general, the higher the score, the higher will be the card limit.
As per the growing trend of buy-now-pay-later, the credit card industry in India is expected to grow at a CAGR of 25% during 2020-25, says data. Credit cards do help people in making high-value purchases easily but they also come with the risk of overspending beyond the repayment capacity.
Also known as bank cards, debit cards allow an individual to use money kept in the bank account for different kinds of purchases. They eliminate the need to carry cash for purchases. Alternatively, one can also withdraw money through ATMs using these cards.
Both credit and debit cards look identical typically. However, there is a key difference between the two – debit cards allow an individual to use the money he has in the bank account(s), while credit cards help in borrowing money for a short term from the card issuer for purchases.
Most debit cards come with daily purchase and withdrawal limits, which means one cannot make large purchases using these cards.
Unified Payment Interface, popularly known as UPI in India, is an advanced payment method that allows users to send and receive money instantly via their smartphones. It is a single platform that merges various banking features and enables real-time bank-to-bank payments using a registered mobile number, UPI ID, and PIN.
As a unique initiative taken by the National Payments Corporation of India (NPCI) and RBI, UPI has made the process of transferring money very easy. Unlike in the past, individuals do not need to remember account number, IFSC code, or bank name of recipients to send money.
With UPI, they only need UPI ID and PIN for money transfer, simplifying payment process at nearby restaurants, grocery stores, and online purchases.
Also known as Internet banking or online banking, net banking is a method with which bank account holders can avail of various banking services via the Internet. They need not visit the nearest bank branch for every small and big banking needs, be it checking the account statement or balance, open a FD account, pay utility bills, transfer money, and many others.
Some of the primary advantages of net banking are:
- Round-the-clock availability of banking services
- Convenience of paying bills and other banking transactions remotely
Once bank account holders have registered for the net banking facility, they can also use it as a payment method while making purchases online.
Paytm wallet is one of the most common payment methods used in India to send and receive money. As an equivalent to a physical wallet, it is meant for both online and offline purchases. Users can add money into their Paytm wallets and then use it for wallet-to-wallet or wallet-to-bank transactions.
Paytm is the pioneer in bringing digital wallets to the nation to allow individuals to send and receive money online. In the Indian digital payment landscape, the payment service provider is the largest player serving millions of merchants and end-consumers.
How to start accepting payments via multiple payment methods?
The selection of right payment methods is integral to the growth of your business. You might have faced situations in which customers left your store without making a purchase because of non-availability of digital payment methods. While it is easier for customers to make payments online using these methods, merchants also benefit from single-point reconciliation of all payments received.
The first step towards accepting online payments is the selection of suitable payment methods based on your business type.
Paytm, being the largest payment enabler in the country, offers a comprehensive suite of online payment methods for all types of businesses. Given below is the table that enlists our payment products:
|Payment Products for Offline Businesses||Payment Products for Online Businesses|
|All-In-One QR Code||Payment Gateway|
|All-In-One POS Machine||Payment Links|
Things to consider while shortlisting payment methods for your business
Making multiple payment methods available to your customers is obviously good. Many customers do not complete the purchase because they are not offered their preferred payment method. But it is also possible that you offer a plethora of payment options and they still drop just the same way.
Hence, there’s a happy medium that you need to strike – the selection of payment methods that are ‘just right’ for your business. It depends on various factors like:
Preferred purchase mode
Do your customers buy from your store both offline and online? Choosing the most preferred mix of payment methods for your customers may be the best option if they make purchases in both ways. But if they primarily checkout online, it would be best for you to limit yourself on online payment methods while also omitting offline options safely from your list.
Do you offer products or services with a one-time purchase or recurring billing model? You need to factor in the need for a subscription facility to accept recurring payments. Based on the business model your customers are most familiar with, you can pick the payment methods.
Scope of business
Having a regional or national-level business requires a specific set of payment methods for operations. However, if you want to lay the ground for international deals, you will also need to accept methods that help accept payment in multiple currencies.
In most cases, every payment method is available at a certain upfront and ongoing cost for usage. For instance, there is a monthly rental charge associated with POS machines, while there is MDR for payment gateway integration. Hence, it is important that you compare these costs and select the methods accordingly.
You May Also Like to Read: A Complete Guide to Payment Gateways
Payment methods FAQs
How many payment methods can I select for my business?
You can select as many payment methods as you want, depending on their suitability for your business. Keep in mind that the right selection of these methods will help you attract potential customers.
What are different online payment methods?
For online businesses, the list of popular payment methods includes debit cards, credit cards, net banking, digital wallets, to name a few. It is up to you to decide which of these methods you would like to use for the business.
Which payment service provider should I choose to include various payment methods?
You can partner with Paytm for its comprehensive payment suite that enables you to accept payments online in various ways. Our payment products are fast, easy to use, and are highly useful for both in-store and online payments.
Are all payment methods safe?
All the payment methods mentioned above are highly secure and are backed by anti-fraud technology.