How Accepting Multiple Forms of Payment Can Help Your Business

Offering various payment options can be a powerful business tool that allows customers to pay the way they want. If a business doesn’t accept certain payment types, it may be limiting the number of customers or the number of sales. Here are the most common ways to pay and the benefits that come with them.

Forms of Payment

• Cash and Checks
• The use of cash and checks are declining; however, they are still valid and accepted payment methods. Small businesses most commonly accept cash. So, if you’re a small business looking to increase your payment methods, consider adding new forms of payment to increase your sales. An easy way to start is with an invoicing and payments solution, like Autobooks. You can send and schedule electronic invoices, which gives your customers more ways to pay.
• Money Order
• Money orders are in the same situation as cash and checks – they’re declining. People most often use money orders in situations when they may not want to reveal specific personal information. You can also use them for rent payments and giving gifts.
• Debit and Credit
• The most common way to pay is through a debit or credit card. Most people have at least one credit card, and credit card usage is significantly increasing.
• Buy Now, Pay Later (BNPL)
• BNPL is an emerging alternative to credit cards, allowing customers to split purchases into interest-free installments. BNPL options appeal particularly to younger demographics, like Millennials and Gen Z, who prefer flexibility without the risk of interest fees. Businesses offering BNPL often see increased sales and higher customer satisfaction, making it a valuable addition to their payment offerings.
• Mobile Payments or Digital Wallets
• Paying for purchases is faster and more convenient than ever. Mobile phones have become easy payment options. Apple and Google offer contactless payments, making digital wallets a quick way to check out.
• Digital Currency - Bitcoin
• Digital currency is currency that only exists in electronic form. An example of digital currency is Bitcoin. Although digital currency will not replace other forms of currency anytime soon, it is a payment method that younger customers are starting to use.

Accepting different payment methods online and in person is key to business success. Here are five ways it can help your business grow:

1. Retain Current Customers

By offering multiple forms of payment, you will retain customers who are adapting to the new payment formats. With the increasing need to stay home, many customers need another way to pay. By offering online payment options, you can retain current customers who would usually shop and purchase while in-store.

2. Attract New Customers

Having multiple forms of payment can attract millennials and Gen Z customers who are prone to using digital wallets and cryptocurrencies, over purchasing in-store using cash. Payment apps like PayPal, Venmo, Zelle and Cash App are making online payments more secure, and easier than ever before. Security is a major area of concern for online shoppers. Giving them multiple ways to pay can ease security fears. Researching your target audience to determine what payment methods they use is the best way to decide what forms of payment you want to offer.

3. Increase Sales

Having multiple forms of payment can increase the number of new customers you attract and the current customers you retain. It can also increase your sales. For younger consumers who are likely to use mobile payment options, this can deter them from purchasing a product or service, if the business does not offer their preferred payment method.

4. Keeps Cashflow Going

Various payment methods will settle at different times, keeping the money flowing into your business. While a credit card payment may take days or weeks to settle, cryptocurrencies settle almost instantly. For small businesses, this could alleviate the stress of having to pay bills on time. Having multiple forms of payment helps keep a regular cycle in your cash flow.

5. Saves Money

Giving customers the option of how to pay can actually save you money. For example, when you accept credit cards, you will incur different types of fees for that payment method such as processing fees, fixed fees and situational fees. You may have to pay a local bank or payment gateway for those processing fees. Offering multiple payment options can save you money on fees associated with credit cards.

Discovering the ways your customer likes to pay can ultimately determine what payment methods you need to offer. The bottom line is that offering multiple payment options can be the factor that drives or deters a sale. Be sure to adapt to the changing landscape of payment options as technology continues to develop and innovate.