How to choose the right payment method for your business

As consumer expectations continue to evolve at breakneck speed, businesses must stay one step ahead by offering diverse payment options. Whether you’re selling goods online, running a subscription-based service, or accepting in-person payments, choosing the right payment methods is critical for enhancing customer satisfaction, reducing cart abandonment, and fuelling both local and international growth.

In this guide, we’ll explore:

• Why offering multiple payment options is essential

• The most common payment methods available to businesses

• A brief pros and cons comparison to help you decide

• Key considerations when selecting payment methods

• How Falcos unifies these diverse options into one seamless platform

  
  

The Importance of Offering Multiple Payment Methods

Offering a variety of payment methods can significantly impact your bottom line. A 2024 survey by leading web UX researchers found that 13% of people will abandon an online purchase if their preferred payment method isn’t available. This indicates that even if your products or services are excellent, failing to meet customer payment preferences can erode sales and damage brand loyalty.

Key benefits of offering multiple payment methods include:

• Enhanced Customer Convenience: Shoppers can choose the payment approach that feels most comfortable to them.

• Increased Sales Opportunities: A broad set of payment options encourages impulse and repeat purchases.

• Reduced Cart Abandonment: Seamless, familiar payment flows help customers complete transactions.

• Future framerproofed Operations: With technology changing so rapidly, offering modern methods (e.g., digital wallets and Open Banking) prepares your business for ongoing shifts in consumer behaviour.

  
  

At Falcos, our mission is to simplify these complexities by integrating a wide range of payment methods into a single, streamlined system.

Overview of Payment Methods

Below is a closer look at the most popular payment methods your business might consider. You don’t necessarily need to accept them all—focus on those that align with your audience and business model.

1. Card Payments

Credit and debit cards remain a cornerstone of modern commerce. They are widely accepted worldwide and can be used for one-off or recurring payments. By integrating with a reliable payments platform (like Falcos), you can securely store customer details and reduce friction for returning buyers.

• Advantages: Familiar, accepted globally, quick authorisation.

• Challenges: Transaction fees can be higher; fraud prevention (PCI DSS compliance) is critical.

  
  

2. In-Person and Contactless Payments

Contactless “tap” payments and chip-and-PIN terminals dominate the in-person experience. With fewer people carrying cash, offering contactless options can be a major convenience for customers who value speed and efficiency.

• Advantages: Fast, straightforward for small transactions, suits brick-and-mortar settings.

• Challenges: Hardware or terminal costs; some transaction limits on contactless.

  
  

3. Digital Wallets

Services like Apple Pay, Google Pay, and PayPal streamline the checkout process. These methods can boost conversion by allowing shoppers to pay with a single tap. Digital wallets also add an extra layer of security because they encrypt user data and often require device-based authentication (like Touch ID or Face ID).

• Advantages: Speed, convenience, additional security layers.

• Challenges: Requires users to have compatible devices; some demographic groups are less comfortable with e-wallets.

  
  

4. Open Banking Payments

Open Banking allows customers to pay directly from their bank accounts, bypassing card networks and reducing processing costs. Funds are often transferred instantly, and because it leverages secure banking APIs, the risk of fraud is lower compared to traditional card payments.

• Advantages: Lower transaction fees, immediate transfers, strong security with bank-level authorisation.

• Challenges: Adoption is still growing; may require educating customers about how it works.

  
  

5. Alternative Payment Methods (APMs)

From “Buy Now, Pay Later” (BNPL) services to region-specific solutions like GiroPay or Sofort, APMs allow you to cater to different international markets and audience preferences. While these can be a brilliant way to capture niche segments, they require some due diligence—each payment method has its own rules, fees, and security protocols.

• Advantages: Expands your reach, offers more flexibility, can cater to demographics lacking credit/debit cards.

• Challenges: Possible higher risk for defaults (BNPL); varying integration requirements and regulations.

  
  

6. Phone Payments

Though overshadowed by digital-first methods, phone payments still matter in certain industries and among certain age groups. Here, customers provide card details over the phone, which your business processes through a secure virtual terminal. Ensuring PCI DSS compliance is essential to safeguarding these transactions against fraud.

• Advantages: Helpful for remote or phone-based purchases, suits those uncomfortable with online payments.

• Challenges: Not instant in the same way as card or digital methods, can be vulnerable if security protocols aren’t robust.

  
  

7. Direct Debit

For subscription-based or recurring billing models, Direct Debit remains a cornerstone. It automates the monthly or quarterly draw from customers’ accounts without the risk of card expirations. Customers appreciate the peace of mind; businesses love the stable cash flow.

• Advantages: Ideal for predictable billing, reduces payment failures from expired cards.

• Challenges: Slower to set up, must stay compliant with Direct Debit regulations.

  
  

  Read more here.

  
  

8. Cash Payments

Despite contactless and digital wallets becoming mainstream, many customers still rely on cash—especially in certain regions or industries. Accepting cash can be a lifeline for those without banking access and can demonstrate inclusivity on your part.

• Advantages: No transaction fees, immediate settlement, appeals to underbanked demographics.

• Challenges: Physical handling, increased risk of loss or theft, more cumbersome reconciliation.

  
  

Pros and Cons: A Quick Comparison

Key Considerations When Choosing Payment Methods

1. Industry

   Different sectors have unique norms. For instance, in-person retail thrives on contactless and card payments, while subscription services rely heavily on Direct Debit or recurring card payments.

   
   

2. Target Market

   Your demographic’s preferences—age, location, online habits—will guide your payment method options. Younger, tech-savvy audiences may favour digital wallets, while some segments still prefer cash or phone orders.

   
   

3. Transaction Volume and Frequency

   High-volume merchants often look for low-cost, scalable solutions like Open Banking or Direct Debit, whereas smaller businesses may prioritise flexibility and user-friendliness.

   
   

4. Customer Preference

   Providing customers their preferred methods can lift conversion rates. If you’re operating internationally, consider region-specific APMs to lower cart abandonment.

   
   

5. Business Needs

   Think about integration with CRM, existing finance software, or your e-commerce platform. Falcos, for example, specialises in unifying these disparate channels and systems.

   
   

6. ROI

   Evaluate each payment method’s fees, administrative demands, and potential for boosting revenue. High transaction fees can be acceptable if they significantly increase sales volume or conversion rates.

   
   

Falcos: Simplifying Your Payment Ecosystem

At Falcos, we streamline multiple payment methods into a single, unified environment. My colleague Jordan and I used to wrestle with a tangle of separate payment gateways and software tools—until Falcos simplified our entire financial management. By bridging CRM, finance, and other key systems in one place, Falcos eliminates the headaches of juggling multiple vendors.

• Integration Made Easy: Connect all your preferred payment channels—card, contactless, phone, Direct Debit, Open Banking, and more.

• Reliable Security: We comply with leading security standards, so you can rest assured transactions are protected.

• Scalability: As you add new markets or product lines, Falcos can grow with you, ensuring you never miss a sale.

• Transparent Reporting: Track all transactions in one interface, reducing administrative overhead and giving you real-time business insights.

  
  

Conclusion & Next Steps

Offering diverse payment methods is no longer a luxury—it’s a must-have for any modern business. By catering to varying consumer preferences, you’ll reduce barriers to purchase, enhance customer satisfaction, and fortify your business against changing market conditions.

Ready to revolutionise your payment experience? Get in touch with Falcos today, or book a personalised demo to see how our unified platform can integrate all your payment channels—leaving you free to focus on what you do best: growing your business.

Falcos: Powering the Future of Payments

“We believe in an inclusive, frictionless payment landscape that is both innovative and secure. Let’s shape that future—together.”