Which Payment Methods Should You Accept

Whether you’re selling a service, digital product, or physical goods, chances are that you need to process payments nearly every day. There are so many different methods of accepting that deciding which option is the most beneficial can be daunting.

Some services take a small percentage of your sales but protect you in case of a dispute with your customer, while some methods of accepting payment offer no protection, but allow you to keep the full amount of the sale (less taxes.) Weighing the pros and cons of each type of transaction can help you in making decisions about which forms of payment to accept. We hope this outline of the most popular methods will help you choose the right fit for your business.

Cash

For businesses that collect payments at a physical location, processing cash is a must. Although credit card and digital transactions have become the more common methods of payment in recent years, many people still carry cash and expect to be able to use it anywhere they go to purchase products or services.

Credit Cards

Credit card payments are one the most popular payment methods. When configuring your business to take credit card payments, you’ll want to pay attention to “swipe fees” on small purchases imposed by processing companies. These swipe fees can often be avoided by having a minimum purchase amount.

Payments from Devices

This includes things like Apple Pay, Samsung Pay, and Google Pay, where customers can complete their transactions from their devices, such as watches and phones.

Gift Cards

Offering gift cards for your business is a great way to encourage your clients to spread the word about your product or service by gifting a set amount to others.

PayPal/Stripe/Square

Online payment gateways make it easy to accept funds from customers. The platforms take a small percentage of your sale as a fee for using their service, but the trade off if often worth it for the protection you receive if the transactions goes awry. This is especially helpful for the very small business or freelance worker who wants to be paid efficiently without having to set up a merchant account to receive credit card payments.

Foreign Currency and Union Pay Cards

According to Accounting Web, accepting payments from out-of-country visitors is worth exploring if you are in a major metropolitan city or travel hub. Accepting foreign currency or Union Pay Cards may increase your ability to sell your product if there is a high amount of tourism in your location.

Cryptocurrency

While cryptocurrency such as Bitcoin has made headlines in the past few years, very few businesses are currently accepting it as a form of payment. This may change in the future as the cryptocurrency market grows and changes.

EFT (Electronic Funds Transfer)

For large amounts such as invoice payments, you may choose to have funds automatically transferred from your client’s bank account to yours.

Person-to-Person

Apps such as Zelle and Venmo make it easy to transfer money, but they were originally created to assist paying funds to individuals rather than businesses. Little to no information is provided in the reporting so it’s difficult to accurately post transactions in your bookkeeping file. But if you need an easy payment method quickly, this is one you can consider until setting up one meant for business.

Accepting a wide range of payment methods ensures that you are able to do business with almost anyone who walks in your door or clicks on your website. While each has its strengths and weaknesses, offering multiple options for customers to check out can help you reach your sales goals by making it possible for nearly anyone to do business with you.