Alternative Payment Methods: Are They Right for E-Commerce?

One of the keys to getting e-commerce right is ensuring that the shopping experience is convenient and effortless for the consumer. This becomes especially important when it comes to payment. There’s no worse feeling than watching potential customers abandon a nearly completed sale because your checkout process stinks.

Of course, several issues can contribute to this, from either lax or overaggressive security procedures, to a cumbersome shopping cart platform. However, a growing source of confusion is arising over alternative payment methods – especially those that cater to increasingly mobile consumers.

As financial technology rapidly evolves, it’s not easy for merchants to keep pace. But alternative payment methods are expected to account for a whopping 22% of online purchases by the year 2019.

In this new retail environment that favors customized choices and out-of-the-box approaches, online retailers who stick with only the three major credit cards may soon find themselves at a disadvantage.

Still, expanding the field to accept more and more payment methods carries not only additional costs, but additional risks as well. The question business owners have to ask themselves is whether accepting alternative payment methods is worth the hassle.  

The Players in Alternative Payments


One of the most well-known and widely accepted payment methods, PayPal is the gold-standard – a convenient and reliable money transfer service that many consumers and merchants alike already know and feel comfortable with.

  • Pros: Merchants can give customers the flexibility of paying with a credit card, connected bank account, or PayPal account. Setup is easy, and the checkout process can be customized to match your business and your brand.
  • Cons: There is a growing industry for PayPal fraud, in which customers place an order and later contest the charges, which almost always results in a chargeback or claim for the merchant.

Android Pay and Apple Pay

Particularly for businesses where e-commerce is driven via a mobile app, Android Pay (formerly known as Google Wallet) is worth considering. Customers still pay via credit or debit card, but Android Pay pulls the customer’s payment and shipping information directly from the user’s Google account.

  • Pros: Purchases can be made in as little as two clicks, for a speedy checkout process. For merchants, the entire process utilizes the existing payment infrastructure, so setup is minimal.
  • Cons: Only available to Android or iPhone phone users, or Chrome or Safari browser users, which may equate to limited reach.

Amazon Payments

With this tool, merchants can allow shoppers to check out using information stored directly in their Amazon accounts. Customers can also setup recurring payments for subscription-based purchases. Best of all, payment processing is conducted inline, which means the customer doesn’t have to leave your website to complete the payment.

  • Pros: Amazon Payments is relatively easy to setup and offers the type of easy-breezy customer experience you’d expect.
  • Cons: Customers must already have an Amazon account linked to a credit card. There may be a trust issue as well; customers may be reluctant to let Amazon be involved in so many areas of their lives – or they may be reluctant to let you have access to their Amazon profiles.

Visa Checkout and MasterPass

Both Visa and Mastercard transactions have thrown their hats into the alternative payments ring.  Both options offer consumers a single sign-on payment method that automatically inputs the customer’s shipping and payment information, making the checkout process as simple and streamlined as possible.

  • Pros: Trust in the Visa and Mastercard names is a major advantage with both options. Configuring both payment methods is straightforward, and just about every online consumer already uses at least one of these two cards. Merchants can also offer special promotions for customers who utilize these payment methods.
  • Cons: Customers need to first setup and enable the digital wallet through the Visa Checkout or MasterPass app. This is an extra step and an extra login credential for customers to remember, which may confuse or irritate some.


This person-to-person payment system is backed by banking heavy hitters like Wells Fargo and Chase. Payments are directly received from and sent to the bank account of the account holder.

  • Pros: Security protocols are bank-grade, meaning they are as secure as any online banking service.
  • Cons: Customers need to be a member at a participating bank, and payment transfers aren’t quite as real-time as merchants might like (bank transfers typically take at least 24 hours).


The jury is still out on whether Bitcoin will ever live up to its hype as a true alternative currency. For now, the biggest question any merchant should ask is whether its customers are likely to be active in the Bitcoin realm or not. 

  • Pros: Fast payments, with relatively low payment processing fees. Payments are 100% irreversible, so there is no risk of chargeback or payment fraud.
  • Cons: Bitcoins are traded, which means the price of this cryptocurrency fluctuates. You’ll need to work with a bitcoin exchange to buy, sell and trade bitcoins. This article provides an excellent explanation of how to get started with bitcoins.

Questions to Ask Yourself

Naturally, the first step to getting started with alternative payments is to educate yourself about the various options available to you.

To do this, consider several perspectives – including:

  • Which of these payments methods is your target customer most likely to use?
  • What e-commerce features do these methods need to support?
  • What security do these methods include, for both you and the customer?
  • What is the right number of payment methods to offer without unnecessarily complicating your checkout area?
  • How will you report and reconcile these alternative payment methods?

Choose a Trusted Partner

In many cases, determining which payment methods to offer will be a decision best made with help. A payment partner may be able to help answer some of these key questions listed above, to help you determine which methods make the most sense for your business – and, just as important, which ones you can probably take a pass on for now.

Clearsale can be your payments partner – contact us today!

 New Call-to-action