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6 e-commerce payment methods your store should be accepting

6 e-commerce payment methods your store should be accepting

Offering a secure payment processing experience is essential to operate a successful online store. However, brands also have to contend with shifting consumer preferences when it comes to e-commerce payment options.

It’s become essential for e-commerce brands to offer multiple payment methods at the checkout that address different customer needs, such as convenience, security, speed, and rewards.

In doing so, businesses can enhance customer satisfaction, increase conversion rates, and gain a competitive edge in the e-commerce landscape.

The question is: Which e-commerce payment methods should they be offering?

In this blog, we’re going to explore how payment preferences are changing in e-commerce, and which e-commerce payment methods that brands should be investing in to streamline the customer experience.

What payment methods do customers prefer in e-commerce?

Payment preferences in e-commerce are constantly in flux as new technologies bring new payment methods to the forefront. As options expand beyond just credit and debit cards, brands need to make sure that they stay up to speed with innovations that offer increased speed and convenience to their customers.

The recent study “Tracking the Digital Payments Takeover: Catching the Coming eCommerce Wave” by a PYMNTS and Amazon Web Services has shed light on what online payment methods are most interested in – and the responses are varied.

Traditional credit cards continue to be a highly favored payment method, which may dovetail with the decrease in consumers who are planning to adopt a Buy Now, Pay Later plan over the next year. Other payment methods are continuing to rise in popularity, with digital wallets including PayPal and Apple Pay seeing high rates of planned adoption due to convenience and increasing availability:

chart for payment method trends in e-commerce

In sum, today’s e-commerce customers aren’t just sticking with one payment method; they want to flexibility to switch between multiple payment solutions depending on their needs. Not all payment methods are alike, so both large and small businesses need to offer multiple payment methods that address the different purchase scenarios that consumers may find themselves in.

For example, credit cards and Buy Now, Pay Later schemes typically see their usage peak around the holiday season, when consumers often need to rely on credit. Digital wallets can be particularly useful in mobile shopping when consumers are buying items on the go, as it saves wasting valuable time entering their payment information.

So, which online payment methods should your e-commerce business be investing in, and why? Let’s take a look:

1. Recurring billing

Since your business is probably already accepting credit and debit cards, you can take card-based payments a step further by offering recurring payments for certain products or services.

Recurring payments offer customers the convenience of not needing to give their payment details again because they are kept securely on file. This functionality opens the way to offering subscription-based products, including replenishment subscriptions for products that customers want to repurchase at regular intervals, such as vitamins, makeup, or skincare products.

Other subscription-based offerings include curated subscriptions, where products are chosen according to consumer preferences, or access subscriptions, where consumers get a specific perk in exchange for an annual or monthly fee.


Buy Now, Pay Later (BNPL) offers shoppers the ability to pay off their purchase over a fixed period, rather than paying the total cost upfront. BNPL is increasingly favored by customers who want to spread the cost of high-ticket items.

After signing up to a Buy Now, Pay Later provider, the customer will make an initial payment to receive the items they’re purchasing upfront (usually a percentage of the total sale) and then pay off the remaining balance via a series of interest-free installments.

Merchants who offer BNPL will still receive the proceeds of the sale upfront, even if customers pay off the total purchase over several weeks. This makes BNPL a great way to convert first-time customers or customers that are making impulse purchases. According to a study by BNPL provider Affirm, retailers using its services saw an average increase of 20% in conversions and 87% in Average Order Value (AOV).

3. Digital wallets

Accepting digital wallets is now essential for every e-commerce brand as one of the fastest-growing online payment methods. By 2026, digital wallets are forecast to make up 41% of total e-commerce transactions. In the same timeframe, the share of credit cards being used online is predicted to fall to 23%.

Digital wallet options such as Apple Pay, Google Pay, and PayPal enable shoppers to store multiple debit cards or credit cards within a secure encrypted app, without needing to manually retrieve their card details each time they want to make a purchase. This makes the payment process easy and seamless for customers, as they only have to click the wallet icon at the checkout to retrieve their payment information.

4. Bank transfers

Although not traditionally one of the most popular ecommerce payment methods, bank transfers (also known as electronic money transfer (EFT) offers a secure payment option for customers who may feel uncomfortable sharing their card details via a payment portal.

Bank transfers offer a significant advantage to merchants, as it provides a workaround to avoid credit card network fees, chargeback costs, and more. The brand must request the customer’s bank account details and permit the total sale amount to be deducted from their account.

5. In-app payments

The explosion of social commerce has been driven by consumers who want to make purchases on the same platforms where they are already discovering and browsing products. In-app purchasing functionality enables brands to set up their own storefronts within social media sites like Instagram and Facebook, with payments being processed via a payment gateway within the app.

Allowing customers to place orders directly via their favorite platform increases customer satisfaction by offering choice over where the purchase takes place. For brands, this avoids losing customers from your sales funnel during that tricky transition of directing them onto your website to make payments.

6. Cryptocurrency

Although still only invested by a minority of customers, cryptocurrencies still have a lot of potential in e-commerce. Because cryptocurrencies use distributed ledger technology (DLT) to keep a public record of transactions, they are arguably much more secure than traditional financial institutions.

PayPal has allowed U.S. consumers to pay online using cryptocurrency and store it in their digital wallet since 2021, which has opened the way for currencies to be integrated much more seamlessly with existing payment architecture. Although mostly unregulated, growing efforts to legislate cryptocurrency will likely mean more mainstream adoption by consumers, which will increase demand for this payment method.

How to select the best payment methods for your e-commerce website

Understand shopper preferences

Every online shopper has their own preferred payment services, but there are certain commonalities within consumer segments. Baby Boomers, for example, have very different payment preferences from Generation Z. Where Baby Boomers are heavy users of traditional credit cards, nearly 60% of Gen Z elect to make payments with a digital wallet. In sum, knowing who your target audience is will help you to select payment methods that will appeal to customer preferences.

However, knowing the most popular payment methods at your online store is important to avoid taking away payment options that customers have come to rely on. Moreover, there may be other payment types that aren’t currently available that would see a high uptake if added to your checkout. This is why it’s a good idea to survey your customers to find out whether there are certain payment methods they would like to see at your store.

Check transaction fees

Before you accept payments from a certain source, you need to understand how much this is going to cost your business. Transaction fees can vary wildly between payment options and payment processors, so it’s important to understand how this affects your bottom line.

For example, Buy Now, Pay Later has grown in popularity because it allows customers to defer payments without any additional cost to them. Merchants offering BNPL, however, get charged high merchant fees to get this particular payment service profitable. So, while a particular payment option could attract more customers to your online store, it’s important to check that this isn’t outweighed by the cost of offering those payment solutions.

Think about how to make your payment options more attractive

Understanding what motivates customers to use different payment methods is essential to encourage payment habits that are beneficial to your brand. For example, a recent PYMNTS study found 70% of consumers who use credit cards to pay for online purchases do so to earn better rewards, while 32% cite earning rewards as the primary reason to make a payment with their preferred online payment methods.

The ability to earn rewards is a great way to positively influence consumer behavior and incentivize shoppers to select payment services that are beneficial for your business. This is especially useful in situations where it may be difficult or impractical to add a large number of online payment methods to your checkout.

Reward perks to choose certain payment methods could include discounts, VIP points, or even free products. For example, if a customer opts for recurring payments to buy regular replenishments of their favorite products, you could offer them a slight discount to encourage customers to sign up for this payment option. This provides your brand with a recurring revenue stream, which is immensely valuable for revenue forecasting. Having customer payment details on file also presents further opportunities for upselling and cross-selling to maximize revenue.

Ensure that your checkout can process payments smoothly

Not every payment gateway is set up to handle all online payments, so it’s important to check what payment methods you can accept with your current system. Your gateway and checkout may need to be reconfigured to add new payment options, which need to undergo serious testing before being made available to customers.

If your payment processing system isn’t able to offer the online payment methods that are preferred by your customers, you may need to consider switching to a different payment provider that offers more flexibility and choice.

Make sure you have robust security in place to combat fraud

While consumers are more open than ever to making online transactions, they are very sensitive to the risks presented by using payment processing services and sharing private information. The 2022 Stay Secure survey found that 85% of consumers surveyed want to know how a business will protect payment information before placing an order on an e-commerce platform.

No matter how favorable your price point is and how many online payment methods you offer, shoppers are not going to purchase if they cannot trust that their payment and shipping information is secure.

Ways to strengthen security at your e-commerce checkout include:

Implement SSL encryption. Use Secure Socket Layer (SSL) encryption to ensure that all information exchanged between the user’s browser and your e-commerce platform is encrypted and secure.

Have a reliable payment gateway. Integrate with a reputable payment gateway provider that is PCI DSS compliant and meets international standards for secure payment processing.

Use fraud detection tools. Advanced fraud detection systems that use Ai and machine learning to identify transactions that may be suspicious. These systems can help to prevent fraudulent activities and protect both your business and your customers.

As payment preferences in e-commerce continue to evolve, businesses need to keep up with innovations that offer increased speed and convenience to their customers. 

From traditional credit cards to emerging options like cryptocurrency and Buy Now, Pay Later, providing shoppers with flexibility and choice is the key to increasing customer satisfaction and boosting conversions. 

By investing in the top online payment methods outlined in this blog, you can ensure that your brand remains relevant to online shoppers.

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