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Top 6 Small Business Payment Methods

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The GoCardless content team comprises a group of subject-matter experts in multiple fields from across GoCardless. The authors and reviewers work in the sales, marketing, legal, and finance departments. All have in-depth knowledge and experience in various aspects of payment scheme technology and the operating rules applicable to each. The team holds expertise in the well-established payment schemes such as UK Direct Debit, the European SEPA scheme, and the US ACH scheme, as well as in schemes operating in Scandinavia, Australia, and New Zealand. See full bio

Last editedJul 20223 min read

From cash to cards, there are plenty of ways for your small business to get paid. Yet each comes with its own set of pros and cons – not to mention fees – to consider. Here is a selection of the best small business payment methods that balance convenience for company and customer alike.

1. ACH payments

By far, one of the most efficient ways to take payment is directly from a customer’s bank account. An ACH payment enables an electronic bank-to-bank transfer service with payments made via the ACH network. It’s available to anyone with a US bank account, enabling merchants to accept payments with lower fees than cards or payment apps.

GoCardless offers an ACH Debit solution that allows the business to control payment timings and amounts, with full consent of the customer. It helps prevent late payments or user error and can be used for both recurring and one-off payments. While traditional bank debit systems can be difficult for small businesses to access, services like GoCardless makes it easy to get started – all without high processing fees.

2. Card payments

It’s important for small businesses to cater to their customer payment preferences. While the landscape is changing, research shows that card payments are still preferred by many customers, second only to bank debits. Accepting debit and credit card payments is standard for most ecommerce businesses, offering broad reach and quick deposits into your bank account with the help of third-party payment gateways.

However, it’s important to consider the impact of transaction fees and chargebacks on your bottom line as well. It’s also vital to ensure that your payment system is PCI compliant to protect customer data.

3. Digital wallets

Services like Google Pay and Apple Pay fall under the category of digital wallets, a popular option noted for its convenience. In-person shoppers can complete the transaction with a tap of their phone thanks to near field communication (NFC) technology. There’s a wide selection of wallets available, so it’s important for small businesses to consider the fees involved. You’ll also need a reader that can handle NFC payments.

4. Mobile payments

You can store your digital wallet of choice on your smartphone, yet there’s also an array of othermobile payment apps out there. This includes services like PayPal and standard banking apps, as well as money transfer and peer-to-peer apps like Venmo. Mobile payment apps like Venmo can be useful for growing businesses that want to accept cashless payments via QR code, for example. These offer the benefit of instant confirmation as well as convenience for customers. Just be sure to compare fees. In addition to setup and monthly subscription costs, some apps charge transaction fees as well as withdrawal fees.

5. BNPL payments

Paying off a large purchase in installments is nothing new, but the rise of buy now pay later (BNPL) services has brought installment payments into the modern era. Services like Klarna and Afterpay allow customers to spread the cost of their purchase into a series of smaller payments. These short-term payment plans are typically interest and fee-free, without any need for taking out additional credit.

This payment method is ideal for growing businesses because it makes products and services accessible to customers who might not have the cash up front, or who otherwise wouldn’t qualify for credit-based payments. BNPL is increasingly popular, with four in ten Americans (and 60% of Millennials) planning to use this type of payment for holiday shopping in 2021 alone.

6. Email invoice payments

Freelance contractors and service-based businesses often send invoices for payment. Email invoicing is an efficient payment option for this type of business, giving customers a click-to-pay option embedded directly within the email. This gives full transparency over payment, allowing customers to see exactly what they owe. They’ll also receive confirmation of payment within seconds.

As your business grows, you’ll probably want to offer a combination of the methods mentioned above to best suit your customers’ preferences. Many of today’s top payment processors allow you to accept ACH payments, card payments, and other online payments from a central platform. When comparing the best small business payment methods, be sure to consider factors including pricing, features, flexibility, and security. You should also think about how well the platform integrates with your accounting and CRM systems – for example, GoCardless works with over 300 partners for a smooth, streamlined workflow.

We can help

GoCardless is a global payments solution that helps you automate payment collection, cutting down on the amount of financial admin your team needs to deal with. Find out how GoCardless can help you with one-off or recurring payments.