The payment procedure done via an electronic medium is called online payment. The online payment process does not involve using cash or cheque; the payments can be made electronically. The several benefits of digital payment make present-day businesses way more advanced and sophisticated.
In other words, online payment is also referred to as electronic payment. Because of the ever-rising demand for internet-based shopping and banking, virtual payment systems have gained tremendous popularity.
The market has become very advanced and dynamic with digitalization and technology. It can be observed that electronic payment systems and payment processing devices are on the rise. The utilization of cash, cheque and vouchers based transactions reduces with each passing day with the enhancement of online payment methods.
The transaction is carried out electronically with the help of computer networks, the internet, and digitally stored value systems. Carrying out an online transaction is quite easy and fast, and the customer transfers the amount from their respective bank or credit card account. Virtual payment can be facilitated with the help of a credit card, checking account, or other online payment mediums.
Following are the steps for the online payment procedure:
- The customers’ payment information is submitted to the seller. For instance, the customer fills up the payment form and submits the same.
- Then the sellers forward that payment information to the online payment gateway.
- The online payment gateway transfers the payment to the payment processor.
- If the payment processor authorizes and approves the payment, the response reaches the payment gateway, after which the payment gateway responds to the seller.
- Lastly, the sellers respond to the consumer, informing them about the successful completion of online payment and undertaking relevant action.
Advantages of online payment:
Online payment from platforms like GPay facilitates cashless payments for goods and services via mobile phones, the Internet, or cards. The key advantage of online payment is time and cost savings, enhanced sales, and decreased transaction costs.
The benefits of online payment are listed below:
- Payment Safety:
Online payments via apps such as Paytm, etc. provide numerous methods of securing your payments, like tokenization, encryption, etc. Now, customers need not enter their card details each time since they can save their card details or transact using a Time Password.
- Greater customer convenience:
Online payments offer a smooth payment experience to the customers, as it lets them buy goods on credit by providing them with the pay later facility.
- Quick and simple setup:
Companies can easily integrate online payment gateways instead of spending more time building a comprehensive payment process that needs specific hardware and extra staff. Though, it is important to compare the probabilities before choosing the services of a specific vendor for selecting the most suitable one.
- A wide range of payment options: Online payment services have many alternatives. People have their own choices and preferences; therefore, giving them that choice while making a purchase will increase the likelihood that they will seal the deal.
In conclusion, online payment is beneficial to both people as well as businesses in a plethora of ways. The e-commerce domain is rapidly growing, and while everything is getting digital, payment systems need to be electronic as the contributions of electronic payments to various sectors are very remarkable.