Online payments let your customers pay for your goods and services through your website.
Benefits of online payments
As well as disadvantages, online payment methods have several advantages. Read these examples:
Low labour costsSince online payments are usually automatic, they have lower labour costs than manual payment methods, such as cheque, money order, cash and EFTPOS.
Convenience for online salesOnline payment methods allow conveniently selling goods and services online.
AutomaticOnline payments can be automatic, which can be convenient for you and your customers.
Fast transaction speedOnline transactions quickly provide feedback to you and your customers.
Low risk of theftAfter processing delays, online payments generally go straight into your bank account, so they have a low risk of theft.
Disadvantages of online payments
Online payment methods have several disadvantages. Check out these examples:
Service feesPayment gateways and third-party payment processors charge service fees.
Inconvenient for offline salesOnline payment methods are inconvenient for offline sales.
Vulnerability to cybercriminalsCybercriminals can disable online payment methods or exploit them to steal people’s money or information. Visit the Australian Cybercrime Reporting Network’s Learn about cybercrime page to learn more about cybercrime.
Reliance on telecommunication infrastructureInternet and server problems can disable online payment methods.
Technical problemsOnline payment methods can go down due to technical problems.
Processing online payments
Online payments are usually automatic. Check out this example:
- Your business has a website with online purchase facilities to sell your goods and services.
- A customer visits your website and finds some products they want to buy.
- The customer checks out the products from your website and goes to the payments section.
- Your website lets your customer know the total cost of the products they want to buy as well as their payment options.
- The customer selects and completes their preferred payment method.
- Your website automatically sends your confirmation of payment to you and your customer and sends a request to your business to ship the product.
- Your website automatically gives your customer a receipt and/or a GST tax invoice. If GST applies, you must provide a GST tax invoice within 28 days if your customer requests one.
Tips for using online payment methods
If you want to offer online payments, try some these tips:
Protect customer informationOnly retain credit and debit card information if you need it. Make sure you have good security to protect any information you retain.
Shop aroundLook for the best payment gateway provider or third party payment processor for your business.
Use encryptionMake sure you use encryption for sending payment information to and from your website to protect your customers’ information from cybercriminals.
Train your employeesIf your employees handle online payments, make sure they are properly trained in managing the online payments system and in keeping customer payment details secure.