5 eCommerce payment methods and benefits of them

The boom of information technology and the Internet has created a premise for eCommerce to thrive. With rapid growth over the years, the Internet has become the popular medium for communication, services and commerce. The Internet and eCommerce have changed the traditional buying method of consumers. Consumers will no longer be limited in terms of time and place where they can buy products and services. Along with the development of information technology, digital has changed the business environment in the world, so business transactions have also changed from cash transactions to electronic money transactions. Transactions between business partners continue to grow on the eCommerce platform, and eCommerce payment solutions appear to replace cash payment systems. Electronic payments are used in the payment for goods and services purchased online through the use of the Internet.

In Vietnam, electronic payment was born in 2008 with the first model of an electronic wallet. Currently, many businesses are exploiting the e-wallet model, but according to information from the State Bank, currently, only 9 enterprises such as Payoo, MoMo, Mobivi, etc. are licensed to test this type of service. 

What is an eCommerce payment?

ECommerce payment is a model of non-cash transaction that has been used in the buying process of eCommerce and has become more and more popular in the world in recent years. In simple words, this payment method is a transaction on the internet environment, through which users can make payments, transfer, deposit, or withdraw money, etc.

Usually, this method is made through eCommerce payment gateways (acting as an intermediary to carry out online cash flow transactions, with links to commercial banks) or account user’s online banking.

How to set up eCommerce payment and how does e-commerce payment work?

Requirements of an electronic payment system: To use an electronic payment system, you must have an account (Merchant Account) and a payment gateway.

– Merchant account is a special bank account that allows when the business can accept payment by credit card. Credit card payment is only possible through this type of account.

– Payment gateway is a software program. This software will transfer transaction data from the seller’s website to the credit card payment center to validate the credit card payment process.

On the surface, payment processing seems so straightforward: a customer loads his or her online shopping cart, enters his or her credit card details and clicks the “buy” button. Within seconds, both you (the e-merchant) and the customer receive confirmation of the successful sale.

how does e-commerce payment work

Preeminent benefits that eCommerce payment brings

E-payment is an important stage attached to eCommerce. When on the right track, there will be no more using cash to pay when receiving goods like today. So what are the advantages of electronic payment?

Fast, convenient, suitable for the market flow

Vietnamese consumers currently tend to make electronic payments for shopping at supermarkets, convenience stores, luxury goods, high-value purchases, or entertainment, travel, and payment service bills (electricity, water, telecommunications, etc.). Payment is mainly made via mobile devices with a network connection.

Responding to the booming online business trend, e-payment is focused on investment. Shoppers can make quick money transfers anywhere via phone without ever going to the bank.

Easy to monitor and control

All funds are kept in transaction history and allow you to look up easily with just a few simple steps. You can manage your finances and have a good balance of spending.

Professionalize your online business

Most consumers, especially young people, are using electronic payment methods such as internet banking, electronic wallet, QR code, etc. because of their convenience. Therefore, enterprises or business owners that do not have an online payment system will also face many disadvantages.

In the long run, once consumers’ confidence has been created about the quality of goods, the payment of cash for online purchases will no longer exist. Today’s eCommerce payment have also diversified their forms of payment, giving users more choices.

Limit risks when using cash

Risks of loss, lack of money, and forgetting of wallets are very likely to occur if transactions are made in cash, especially with products/services of great value. As for eCommerce payment, all transactions are fast, accurate to each number, transparent, clear, and secure.

The most popular eCommerce payment methods

The most popular eCommerce payment methods

Payment by card

This is one of the best ecommerce payment methods,  accounting for 90% of all eCommerce payments. A payment card is a card capable of paying for goods and services at a few locations, including the website for online purchases if accepted for consumption by that card. Or you can use it to withdraw cash directly from banks or automated teller machines. Currently, payment cards are divided into two categories, which can be issued by banks and financial institutions. Eg:

  • Payment by international credit or debit card: If customers own cards such as Visa, Mastercard, American Express, JCB, they can make payments at more than 60 websites connected to the OnePay payment gateway.
  • Payment by domestic debit card: This type is not popular in Vietnam but quite developed abroad. With this eCommerce payment method, cardholders at Connect24 of Vietcombank or multi-function cardholders of Dong A bank can make eCommerce payments at websites connected to these two banks as well as OnePay payment gateway.

Payment through the gateway

An eCommerce payment gateway is essentially a service that allows customers to transact at eCommerce websites. The payment gateway provides a secure connection system between the customer’s account (card, e-wallet, etc.) and the account of the sales website. Helping consumers and businesses to pay and receive money on the internet simply, quickly and safely. There are also several banks implementing top eCommerce payment gateways. Typically as:

  • Payment via eCommerce payment gateway F@st Mobipay: This is a service part of Techcombank’s payment solution. Allow customers to open accounts and make bill payment transactions by phone message to the call center 19001590. To ensure safety and confidentiality for customers, you can make payment by bank transfer using Internet Banking.
  • Payment via Dong A payment gateway: Since 2007, Dong A Bank has also allowed multi-function cardholders to make online payments on “Digital Dong A Bank” using Internet Banking, SMS Banking, Mobile Banking.

Payment by electronic wallet

E-wallet is an online account that can be used to receive, transfer money, buy phone cards, movie tickets, pay online fees on the internet such as electricity, water bills, telecommunications charges, you can also buy goods online from eCommerce sites. Users must own a smart mobile device with an integrated e-wallet and link to a bank to be able to use this eCommerce payment solution.

Via Mobile Banking

This eCommerce payment solution is gradually becoming popular because almost everyone owns a smartphone. Therefore, when shopping, customers do not need to bring cash, instead pay by phone with a Mobile Banking service. The telephone payment system is built on a model of links between banks, telecommunications providers, and users.

Via QR Code

Technological advancement is also the reason why QR Code payment is increasingly popular. This eCommerce payment method is quite simple, compact, easy to use and user-friendly. QR Code feature is currently available on mobile applications of banks, Google products and services such as Google Chart or Google Map, on signs, buses, business cards, magazines, websites, goods at supermarkets, convenience stores, and even on some super apps such as VinID of Vingroup.

Users use the phone camera to scan the QR code to quickly transfer, pay bills, and purchase goods. With just one scan, after a few seconds, you have successfully made payments at restaurants, supermarkets, convenience stores, taxis, even eCommerce websites or on any product with a code. QR without using cash, card, do not worry about revealing personal information at payment points.

How does the eCommerce payment work?

With a payment card and a computer, a smart mobile device connected to the Internet, consumers can complete the purchase of goods and services through the website. Here are the basic steps for buying and paying online:

Step 1: Go to the website of the supplier and choose the goods/services

Step 2: After the selection is complete, you will place an order by filling in the details requested by the supplier, including Personal information, delivery method and time, way of purchase.

Step 3: The website system will display purchase invoices for you to check information on invoices. Confirm if it is correct to proceed to the checkout step.

Step 4: If the website accepts online payments, you can complete the payment right on the website if you own the cards that the provider accepts. Currently, eCommerce websites all accept Visa or MasterCard branded debit and credit cards. You need to fill in card information such as Card number, expiration date, CVV or other information depending on the request of the issuing bank. Note: Transaction is only successful when the payment card has been registered for an online payment function, the card information is correct and still able to pay.

Step 5: The website system will send an order confirmation email to your mailbox and contact us to deliver the goods.

Final word

The above advantages of eCommerce payment methods will support eCommerce to exist and develop in the digital economy in the future. Therefore, you have to understand eCommerce payment options and recognize the best suitable solution for you to follow. 

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