How Can I Pay Online?

How Can I Pay Online?

Even though the internet is used today as a main source of information for many people, the data show that, in contrast with other European or Asian countries, there is still a large gap between the number of internet searches for information and the number of online purchases made in Spain.

For example, 66% of Spaniards look at products on the internet to view opinions and recommendations before making a purchase, especially concerning vacations —for hotels, flights, and leisure and tourism activities— and restaurants.

There are several industries that are leaders in online shopping, such as travel, fashion and accessories, and electronics (music and sound). But these kinds of purchases are sporadic. Only 19% of Spaniards habitually make weekly purchases online, or go online to do their regular shopping.

Why don’t we make more online purchases?

So we use the internet as a source of information and for occasional purchases, but why don’t we adopt this habit in our day-to-day lives, given that it is easier and more comfortable than shopping in person?

According to polls, these are the main factors that keep people from shopping online:

  1. Lack of trust in the online shopping process: Shopping processes that are not very transparent, or the lack of user experience optimization has made buyers today feel uncomfortable with these shopping processes.

  2. Unease regarding online payment methods and/or fear of online fraud: Giving personal or financial information online makes customers uneasy, even though there are systems that verify identity and ensure information security and improve the exchange in the shopping process.

  3. The desire to see and/or test products in person. Sensory experience is very important for consumers.

  4. Lack of trust with regards to the use of personal data. Unwillingness to provide personal information on the internet, as well as bad practices regarding this information on the part of some businesses has created this problem.

  5. The desire to immediately use products. Even though deliveries are made more and more quickly, it is difficult for these deliveries to achieve the immediateness of shopping in-person.

Online Payment Methods

The internet increasingly offers more payment methods, which offer better information and transaction security. One of the keys in the conversion process.

Traditional Payment Methods

Paying by Card

  • By Credit Card: either physical or digital, the card is linked to a bank account and the payment is postponed.

  • By Debit Card: either physical or digital, the card is linked to a bank account which is charged immediately.

  • Prepaid Card: usually a physical card to be used online, it is topped up to a maximum amount.

  • Gift Card: contains a set amount of money, and does not identify the user.

  • Loyalty Card: identifies the user, and compensates them for their use of the card.

Direct Payment between the Entity and the User

  • Transfer: payment is transferred to the vendor after the purchase.

  • Payment upon delivery: purchased online, but physically paid for when the product is received.

  • Digital Checks: instead of a physical paper check, a digital check is issued for the value of the purchase.

  • Direct debit: the vendor makes the charge to the client’s bank account.

New Methods of Online Payment

Payment and Virtual POS Gateways

  • Companies with their own Payment Gateways: the business stores the card information and makes it easier to make online payments, like with Amazon Payments.

  • Online Payment Services: allow the storage of banking information and secure forms of payment on almost any website, such as PayPal.

Paying with a Mobile Device

  • eWallet: a mobile device is used as a wallet, and is used to access banking information. It is used for online and offline payments, with contactless technology, such as Samsung Pay or Google Wallet.

  • Mobile Payment: the mobile device identifies the buyer, and the purchase amount is charged to the bill for the device.

Alternative Payment Methods
Virtual Currency: like Bitcoin, a decentralized virtual currency which does not correspond to real physical money, this payment method is still only permitted on a handful of websites, but its use is gradually increasing.

Payment methods are increasingly more diverse and sophisticated, but the key is focusing the development of these methods on user experience and the user’s shopping habits. Luckily, many of these systems are created with this consumer-centered focus in mind.

Article published in ITespresso.