Online payment options

Online payment options are the methods consumers use to pay for items or services online. They include credit cards, debit cards, third-party transfer and digital wallets.

Providing your customers, members or donors with the right mix of online payment options can help you reduce cart abandonment and increase your conversion rates. Learn more about the most popular online payment options here:

Credit Cards

Credit cards are one of the most popular online payment methods. They are secure, easy to use and provide a safe alternative to cash on delivery. When a card is used, the funds are automatically deducted from the customer’s bank account. The name of the card holder appears on the front of the card, and the first figure in the number indicates which network the card runs on (a three means American Express, a four is Visa, and a five is Mastercard).

Most credit cards allow consumers to buy now and pay later by borrowing money from their bank with the promise to repay the amount owed by the bill’s due date without incurring interest charges. Some cards offer perks like cash back and rewards that can be redeemed for gift vouchers, airline tickets or hotel bookings. Cardholders can also convert their unutilised balance to an EMI at low interest rates.

Debit Cards

Debit cards function like electronic checks, withdrawing funds from a cardholder’s bank account as purchases are made. They can be used at online checkouts and at cash registers, where they may require a PIN (personal identification number) to complete transactions. Some platforms like Afterpay and Klarna allow users to make purchases without having to pay in full upfront, although these services typically charge a fee per transaction for retailers.

Another advantage of debit cards is their ability to track purchases in real-time as the money is removed from the cardholder’s bank account instantly, whereas credit cards provide monthly statements and can be difficult to keep up with. This can help consumers avoid racking up debt or spending more than they have in their checking accounts, and it can help them manage their budgets better.

Debit cards are also easier to qualify for than credit cards, as they require a valid bank account and do not rely on the cardholder’s credit score for approval. They are accepted at most retailers around the world.

Third-Party Transfer

Third-party transfers are a way to move money online that doesn’t involve your own bank account. This type of payment is used by e-commerce sites like PayPal and Venmo, as well as some digital currency exchanges. These portals typically offer low transfer fees and are fast.

Some bad actors use third-party transfers to avoid paying for the products or services they buy from P2P sellers. They may claim that the listed payment methods on a P2P ad are unavailable or insufficient to complete the transaction, but you should be firm when refusing to accept an alternative method.

Another popular option for transferring funds online is through the National Electronic Fund Transfer (NEFT) system, or “credit-push” system in banking terms. This system allows bank customers to transfer funds between their own accounts or to accounts belonging to other banks in India. Each bank has its own policies for registering third-party transactions; some allow the request to be submitted via netbanking, while others require physical submission.


Wallets, also called digital wallets or e-wallets, provide consumers with an efficient, secure and convenient method of paying for goods and services in-store, online or through mobile devices. They can contain credit cards and debit cards, loyalty card data, e-vouchers, transportation passes and even identity documents like drivers’ licenses and passports. Depending on the type of wallet, users can upload funds into the digital wallet from their bank account and/or credit card accounts and then use the tokenized information transmitted by the device to complete a transaction.

Closed wallets are a type of digital wallet that limits access to payment and identification information by only allowing transactions with the wallet issuer. They can be accessed from mobile devices, computers or tablets and used to make contactless payments, split restaurant bills with friends or transfer money between accounts. They can also contain loyalty points and offers from a specific retailer or brand. By providing a faster checkout process, digital wallets can help reduce cart abandonment and improve customer experience and satisfaction.