All about CoD, Pay Later, EMIs, Card Payments & more

. 8 min read
All about CoD, Pay Later, EMIs, Card Payments & more

What are Online Payment Gateways?

Online Payment Gateways are e-commerce services used for processing payment information for online shopping sites. There are numerous types of gateways available in the market. Given below are the advantages of online payment gateways:

Reduce checkout time

People often abandon the shopping cart when there are too many payment process barriers. The long durations and excessive efforts lead to the loss of a sale for businesses. Hence, using the online payment gateways, you can make the process easier and faster. It would not only provide more sales but also retain customers due to a pleasant shopping experience.

Safety of customer information

The most severe threat in online payments is identity theft, in which the hackers steal sensitive information like credit card details. It leads to less trust in people in online transactions. But the online payment gateways offer special encryption and safety facilities for keeping client sensitive information safe. These gateways place client finances' security as a top priority for building their trust and comfort in online payments.

Why Offer Multiple Online Payment Methods?

As numerous e-commerce companies have emerged over the years, people prefer to use different payment modes according to their choice. There are countless reliable and easy use of apps for online transactions like PayTM, GPay, etc. Some reasons to opt for a variety of online payment apps are:

  • You don't have to add your payment information every time on the app.
  • Even when you change the device, the data is retained in the app.
  • The transaction has encryption for secure transactions.
  • It is a very convenient and smooth payment method.
  • It is a time-saver; hence people prefer using e-commerce apps.
  • They offer various offers, discounts, and coupons for attracting clients.

When you are setting up your website or online store, it is essential to determine the types of payment for your business. There are numerous different payment types to choose from, but only a few of them offer revenue benefits. Provided below are types of online payments, which you can understand and select as per your requirements:

Types of Payment Methods

Credit Cards and Debit Cards

It is a global payment solution and the most common way to pay online. The company can integrate this gateway in their business to obtain national and international payments. They are very popular with Indian consumers for various reasons. The e-commerce companies offer numerous exciting offers and coupons on payable amounts through cards. You can also easily save the credit card information and debit card on the apps safely for further transactions. You need to enter the Card Verification Value or CVV and One Time Password or OTP, sent by your bank to your mobile number via SMS. It completes your transaction.

Mobile Payments

The method is used in countries that have low credit card use and banking services. It offers a quick payment solution for customers for any purchase done online. These are very commonly used for browser games and social media networks such as dating sites, donation portals, etc..

People having an active internet banking facility can easily use the feature to transfer money directly to a business bank account for online shopping. It ensures the safety of the funds in a transaction. All the transactions need approval from the customer's internet banking credentials before the sale. More than 20% of shoppers use bank transfers with net banking. The banks offer net banking features through apps on the smartphones. These payments are very secure as they require a fingerprint or password for payment authentication.

UPI Interface

The unified payment interface introduction was done in 2018 for making payments of online shopping sites. You need to install a UPI-enabled app for your bank or any e-commerce company, for transactions at online shopping across the country. To use UPI, you need to select the option for payment, on the various shopping websites. Then, the app requests for the Virtual Payment Address or VPA. After you enter the VPA, the merchant site sends a payment request notification to the  UPI-enabled app. You make the approval for the payment by crunching your four or six digit code and allow the transaction. It is a rapid and smooth transaction method.

Direct Deposit

Direct deposits involve the process when the customers direct the bank to send the funds from their accounts to the business directly. Customers need to inform their banks on a prior basis, for making the withdrawal from their accounts, at a given time.


The cash payment is made in the case of prices for physical goods and cash-on-delivery products. There are certain risks in the process as there is no guarantee of a genuine sale or theft scenario.

In the last few years, since online shopping has become prevalent, people are still sceptical of online payments. Cash payments are the top payment method in India. In this, the cash is paid on the product delivery.

Digital Money

It is a prevalent mode of payment for online shopping in India. Digital wallets are in use for about 25% of online transactions. Numerous digital wallets have an online shopping portal also which customers can use for shopping. They offer multiple discounts and offers for customers. Digital wallet payments are also easy and fast to use.


A cryptocurrency is a new form of payment, rapidly gaining people's interest as a viable payment method. Online transactions are more common among young, wealthy professionals having expertise in the IT sector.


The payment method involves payments of a product done in parts as EMI. The prices are done through the funds in the bank of consumers. Credit card or debit card are usable to make the payments.

Pay later

It is a form of the credit system, where a specific portal makes payment on behalf of a consumer. Then the consumer can pay to the portal at a particular time. There is a limit for the amount to use in the pay later system.

Those mentioned above are different types of payment methods. Understanding all the functions and knowing the target audience can decide the best payment method to integrate.

Which is the best Payment Method for Online Shopping?

In the present scenario, people do shopping anytime and anywhere, like on smartphones, tabs, desktops, laptops, etc. They expect a variety of payment options for shopping from online stores. It gives them the freedom to choose as per their comfort. From the business point of view, it is essential to provide the payment methods relevant to a broad audience, and your site can support that gateway.

Being an e-commerce business, finding the preferable online payment method is a great challenge in itself. Understanding and integrating the most used online payment method is essential as 70% of shoppers complete the purchase if their preferred payment mode is available. Given below are some of the most preferred online payment methods for online purchases:

Debit and Credit Card

It is a form of payment that people use most commonly all over the world. People prefer this mode as it offers secure transactions. Its regulation is made by global and regional standard compliances and consumer protection issued by payment processors. Credit card usage is a little more than debit cards because of their additional features like banks’ reward points or programs.


The e-wallet or digital wallet is a fast-growing online payment platform for online shopping all over the world. It is projected to be in use for over 60% of global online sales by 2022. Its working is similar to a prepaid credit account, which stores the customers’ personal information and funds. It makes the purchase easier as customers do not have to enter bank details to complete the process. They have to only input the username and password for directing the investment.

Bank Transfer

The payment method involves the customer making online payments directly from the bank account to the merchant’s account. It is a highly secure form of payment as it requires authentication from the bank of the customer. The portal involves transferring funds through an internet banking portal by logging in and authorising the transaction. It is the third most preferred method of online payment for shopping.

Buy now, pay later

A relatively new form of online payment, it has become quite popular and growing among the customers. It is a form of instant lending for a given purchase, and the consumer has the option to pay back in some time. It is becoming quite popular among youths. With the pay later option, there is an increase in the will of buying more items.


UPI is now continuing on the growth curve in online shopping. There are numerous UPI-enabled apps that offer easy online payment for online purchases. For a complete purchase, you need to enter your Virtual Payment Address (VPA). The payment request is sent to the app, and then you need to enter a 4 or 6 digit secret code for payment approval.


Online payments are increasingly becoming the new way of payment for shopping online. There are several payment methods available that make the transaction safe, swift, and easy to process. The e-commerce apps and e-wallets are the best online payment means which allows you to transact by entering the card or account details. You also need to enter a secret 4 or 6 digit code, making the transfer of funds safe. All the mentioned payment methods offer easy purchasing hence increasing the sales percentage.

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Q. What are the different methods by which a customer can pay during online shopping?

Ans: There are many ways to pay online, and some of them include:

  • E-commerce apps
  • Online banking
  • UPI transfer
  • E-wallet
  • Credit or debit card payments

Q. What is the most used payment method?

Ans: The most used type of payment for online shopping is e-commerce apps and credit/debit card payments.

Q. What is the best payment method?

Ans: The best payment method is online payment for shopping, as it is safe, swift, and elementary to use.

Q. What is the safest form of payment?

Ans: Online payment through e-commerce apps, UPI payments, and credit or debit cards are safest because they ensure security by encryption.

Q. Is online payment safer than cash payment?

Ans: Online payments are indeed safe and more reliable than cash on delivery. There are fewer chances of theft or fraud as the payment is encrypted.

Q. What apps let you pay instantly?

Ans: The apps like GPay, PayTM etc. make the payment instantly by entering the secret 4-6 digit code.

Q. Why is the online payment system best?

Ans: Online payments are the best because they are safe and offer swift services. The banking details are filled in only once, and it stays in the app for further use.