Guide to Different Types of Payment Methods

At the heart of every business is the goal of generating revenue. You get paid for either the goods you are selling or the services you render to others. So you must factor in payments even before you consider any other plans. It is practically impossible to run your business without any hope of getting paid, so the question of payment methods arises. If you are considering which methods of payment to pursue, then you are in the right place.

What Is a Payment Method?

Before we dive in, let’s clarify what a payment method is. It simply refers to the way customers can purchase your goods or services. If you are selling items, there are many ways potential customers can patronise your business. We will be looking in detail at the different methods available.

Top 12 Payment Methods for Your Business

Anyone who wants to make any purchase has several ways to do this today. Whether physically or online, you can receive money from any part of the world instantly. We have put together twelve payment methods available for businesses today.

What Is the Safest Method of Payment?

The safest payment methods today include card payments (with 3D Secure 2.0), UPI transactions in India, and digital wallets with biometric or PIN authentication. These options are considered secure because they rely on regulated infrastructures — such as trusted card networks like Visa and MasterCard or government-backed systems like UPI. Additionally, using cards or wallets typically requires bank account verification, which adds another layer of security. Businesses can also rely on these networks for dispute resolution or fraud protection when issues arise.

How to Choose the Right Payment Method?

Now, the question most new business owners ask is how they can start receiving payments from customers. Before you can go about accepting payments, you need to decide how you want your cash flow. We have highlighted some steps to help you choose the best payment methods for your business.

Identify and Compare Different Payment Method Types

There isn’t only one suitable payment method, and it’s important to know that before making a decision. It will be best to check all your options and understand how each payment method works. It will also help if you know how these payment methods can help your business. As we have already listed ten payment methods, you can figure out how they work and if they apply to global payments or online payments, depending on the nature of your business.

Consider Your Customer Preferences When Choosing a Payment Option

If you are choosing a payment method, it has to be convenient for your customers. Customer preference should be at the top of your decision-making list. Although the most common payment methods are debit and credit cards, some customers will like other alternatives. In addition, some customers will want to seek other payment methods because some are more private than others. Credit card payments always leave a transaction record, which some customers may prefer to avoid for privacy reasons. Some customers choose cash for greater privacy, avoiding digital transaction records.

Choose Reliable Payment Methods

Now, this will depend on where your business is located and what works best for you. Some payment methods, such as a POS system, depend on electricity or stable internet connectivity, which can be a challenge in certain areas. In contrast, UPI and QR-based mobile payments offer better uptime and flexibility. If the power or internet goes out, card readers may stop functioning, and your customer won’t be able to pay. These infrastructure dependencies should be carefully considered when selecting reliable methods for your business.

Check the Costs

One should note that some payment methods come with hidden or additional costs. For instance, banks may have a service fee for POS systems, and even card networks charge service fees on credit cards. Another cost you should consider is the transaction cost, which the bank usually deducts from each transaction.

Calculate the Risks

Receiving payments generally comes with a risk, no matter the form. Cash payments tend to have a much higher risk because of theft as the money does not go straight to your bank account. Moreover, risks are involved when there is a mistake in the payment.

Why Accept Wide Range of Payment Methods

Businesses have evolved over the years, and more payment methods have become available to receive payments. With the rise of real-time payment systems like India’s UPI and Africa’s M-Pesa, consumers can now make instant payments without relying on physical cash. For businesses looking to support such systems in East Africa, using a dedicated payment gateway in Kenya ensures secure and seamless integration. One common trait of successful businesses is their focus on customer convenience — not just through quality services, but also by offering flexible and accessible payment options. The more methods you offer, the easier it is to attract and retain customers.

No customer wants to go through the stress of visiting an ATM to get cash. If they can pay with their mobile wallets, by phone, or even through a QR code, they will be happy to patronise your business. Offering a variety of ways to pay increases the likelihood of repeat customers.

However, also keep in mind that the payment methods you choose should be relevant to your business. For instance, if you operate a strictly online business, you really won’t need solutions like POS or cheques. Since everything is online, consider sticking to fully digital ways of collecting payments that suit your business.

Bottom Line

On a final note, now that you have an idea of the payment methods available for businesses, you may want to explore them in more detail. It’s essential to choose payment methods that allow you and your customers to transact easily and efficiently.