Choosing the Best Payment Methods for Your WooCommerce eCommerce Store

Customers who are ready to purchase from your WooCommerce eCommerce Store need a secure, quick, and easy way to checkout. WooCommerce offers a variety of business payment methods—card payments, bank transfers, digital wallets, and even Buy Now Pay Later (BNPL) options.

In a nutshell, offering multiple payment methods on your site provides greater choice. This can streamline your checkout process, boost conversions, and reduce cart abandonments. However, providing too many payment options—or the wrong ones—can overwhelm your customers and incur higher transaction fees.

This guide will help you to choose the best business payment methods for your e-commerce store. We’re going to do this through a six-step process that you can follow along with. At the end of the post, we’d love to hear about which business payment method you opted for and why!

1. Understand Your Business’ Needs

Aligning your business payment methods with your needs, goals, and capabilities is a crucial first step. Specifically, you need to consider your business model, transaction volume, and the locations and preferences of your customers.

The business payment methods you offer may also depend on the products or services you sell. For example, if you’re selling digital products or services, you might require a payment gateway that facilitates recurring payments. If you’re an e-commerce retail store, you’ll want a payment gateway that provides instant, convenient payment processing.

For sites with a high volume of sales, the payment method must be able to handle large-scale transactions. A growing business also needs to consider scalability. This is why PayPal can be a solid option:

There are a couple of other business considerations when choosing your payment gateway. If you serve customers on a global scale, your payment gateways must support the relevant regions and currencies. For example, Stripe supports hundreds of currencies, making it a viable global option. On the other hand, BNPL services often have regional variations that might limit the experience.

Target demographics matter too. If yours primarily uses mobile devices to shop online, it makes sense to support digital wallets for online payments. Those wallets account for 50 percent of e-commerce transactions worldwide—most often by ‘Gen Z’ and ‘Millennial’ consumers. Other payment methods, such as credit cards, are more popular with older generations.

2. Evaluate Your Payment Gateway Options

Payment gateways authenticate, secure, and process transactions from digital wallets, credit cards, debit cards, and other payment methods. WooCommerce supports a range of payment gateways such as Stripe, Square, and PayPal with global recognition. There are also niche services such as Rapyd and Mollie.

The process of installing payment gateways for WooCommerce is much like other WordPress plugins. However, you’ll often find a sandbox or test mode to help you carry out tweaks without using real transaction data or processing.

Choosing a payment gateway requires a few considerations. First and foremost are the transaction fees. In short, you need to pay a charge for every transaction from your store. This could be a flat rate per transaction or a specific percentage of the sale amount.

Many services offer fixed transaction rates of around three percent, with an additional processing charge of $0.30–0.50. This can quickly add up if you have high sales volumes and could be astronomical if you deal with international transactions.

Creating an international WooCommerce store requires payment gateways that support cross-border payments and multi-currency transactions without incurring high currency conversion fees. For instance, if your gateway can only handle USD, customers in countries that don’t use dollars won’t be able to make purchases.

Some gateway websites will display supported locales, as Square’s WooCommerce extension page.

You could implement various country-specific gateways, but it can often be inconsistent to put in place. Plus, this can dilute the User Experience (UX), which will overwhelm customers and drive churn.

Speaking of driving more conversions and reducing cart abandonment, you should also evaluate your payment gateways based on what you know about your customer preferences.

Even on a global scale, this is important to know. For instance, PayPal and Visa dominate the market, so those options should be available regardless of where you target. You’ll also want to narrow down which options align with your business type. For example, a pizza delivery service is more likely to use cash than cryptocurrency payments.

3. Consider Compatibility and Integration Scope

Ideally, the payment gateways you choose should integrate with WooCommerce to provide a smooth and consistent checkout experience. A gateway that’s incompatible with your e-commerce platform can be costly and time-consuming to fix. It can also lead to checkout processes that drive away 14 percent of all cart abandonments.

Also, consider integration with your other business tools, such as your Customer Relationship Management (CRM) platform and accounting software. This is crucial if you want an accurate view of your cash flow and payment processes, as you can get an accurate forecast of your profits and review the health of your business. For example, QuickBooks has a sync extension available for WooCommerce:

With a CRM integration, you can store and sync customer payment data to ensure you have a history that’s up to date and easily accessed by different departments. This can streamline your online payments, reduce friction, and increase your opportunities for personalized upselling and cross-selling.

Of course, finding a gateway that syncs with both your choice of accounting software and CRM is another task that could take time—but offers immense value once you get it right.

4. Ensure Security and Compliance

Around 20 percent of consumers have been victims of a cyberattack. Password attacks, data breaches, Point of Sale (PoS) system malware, phishing, and identity theft are among the most common causes. Therefore, performing a comprehensive evaluation of the payment gateways you use should be a top priority.

Payment processes will handle sensitive information such as card numbers and bank account details. A lack of security and compliance puts your customers at risk of theft, fraud, and various other cyber threats. In turn, this can damage your reputation, lose you money, and even lead to legal ramifications.

The good news is that most reputable payment gateways come with the checks and balances to ensure the data they process uses the best encryption. However, you should also check that the business payment methods you consider provide the security you need.

End-to-end encryption is a must, as well as multi-factor authentication, fraud detection, prevention, and PCI-DSS compliance.

5. Prioritize UX and Consumer Convenience

A lengthy, complex checkout process can cause customers on the verge of conversion to abandon their carts forever. Long or complicated checkout processes are behind 22 percent of customer card abandonments. This indicates that choosing online payment methods that provide a streamlined, convenient UX should be a high priority.

When it comes to your checkout experience, ‘streamlined’ can apply to several facets. We like to consider the following, especially when choosing the right business payment methods:

• Use integrated payment gateways. Hosted gateways navigate users away from your site, which can lead to a jarring experience. Consider using integrated solutions like the WooPayments plugin to minimize redirects and create a smoother, quicker process.
• Prioritize simplicity. Stay away from payment gateways and methods that require customers to enter extensive details or navigate through numerous pages. Look for a plugin designed to be intuitive, with minimal redirects, autofill options, and other functionalities that simplify and expedite the checkout process.
• Offer multiple payment options. Providing multiple payment options, such as digital wallets, bank transfers, BNPL, and credit card payments, empowers customers to check out via their preferred method, reducing cart abandonment rates. Particularly, BNPL payment methods can attract more customers and incentivize conversions.

We’d argue that this is a key component over almost all others on this list (apart from security). After all, the primary goal of your checkout should be to eliminate the barrier to conversion.

6. Carry Out Testing and Optimization

The testing process is one that many store owners will overlook when it comes to choosing business payment methods. However, it must be a consideration at all stages. You’ll want to conduct regular testing and monitoring to optimize those payment processes and maintain your data security.

While the specific testing setup may differ depending on your goals, gateway, and resources, it typically involves many of the following:

1. Simulating different types of transaction scenarios, such as mobile payments and those from various credit card providers. This will help uncover hidden inefficiencies or errors.
2. Split testing different payment options to determine which ones your customers prefer.
3. Monitoring Key Performance Indicators (KPIs) like conversion rates, cart abandonment rates, transaction failures and successes, and average transaction times to gauge performance.
4. Using customer satisfaction surveys to gather feedback on how satisfied customers are with your checkout process.
5. Leveraging the data gathered from tests, KPIs, and surveys to continuously optimize your payment processes.

This process is crucial for ensuring your system processes transactions smoothly and identifying potential issues that may impact the customer experience. By taking this proactive approach, you’ll be better positioned to deliver reliable payment processing and maintain customer trust.

Final Thoughts

At a fundamental level, the business payment methods and gateways you opt for depend on the unique needs of your business. Evaluating international payment capabilities, transaction fees, security and compliance, and the preferences and needs of your target customers covers most use cases. However, there will always be unique requirements specific to your own needs.

Ultimately, you should aim to offer multiple online payment methods to maximize your cash flow and boost sales. The goal is to empower customers to make payments quickly, effortlessly, and securely. Relying on tried and tested business payment methods is sensible in most cases, but it’s always worth investigating whether another approach could complement and benefit your primary solutions.

Do you have any questions about how to implement business payment methods for your WooCommerce store? Ask us in the comments section below!

Frequently Asked Questions

1. What are the best payment methods for a WooCommerce eCommerce Store?

The best payment methods depend on your target market, but popular options usually include PayPal, Stripe, credit/debit cards, and digital wallets like Apple Pay and Google Pay.

2. How can I reduce cart abandonment rates?

To reduce cart abandonment rates, streamline the checkout process, offer multiple payment options, and ensure that the payment gateway is fast and secure.

3. What are transaction fees, and how do they impact my business?

Transaction fees are charges incurred each time a purchase is made through your store. They can vary by payment gateway and can affect your profit margins, so it’s crucial to choose providers with competitive rates.

4. How often should I test my payment processes?

You should test your payment processes regularly, ideally every few months or following significant changes to your store, to ensure everything operates smoothly and securely.

5. Are digital wallets becoming more popular?

Yes, digital wallets are increasingly popular, especially among younger consumers. They enable fast and secure transactions, making them a valuable option to include in your payment methods.