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Digital Payment Guide: Best Payment Methods & Why to Accept Them

Modern payment processing goes far beyond credit and debit cards. Learn about digital payment methods your business should consider accepting.

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Written by: Sammi Caramela, Senior WriterUpdated Jun 09, 2025
Shari Weiss,Senior Editor
Business.com earns commissions from some listed providers. Editorial Guidelines.
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Digital payments are quickly becoming the norm for American consumers. According to 2024 McKinsey data, 92 percent of shoppers used a digital payment method in the last year. Digital payments for in-app purchases grew to 60 percent, while in-store adoption of digital wallet usage increased from 19 percent in 2019 to 28 percent in 2024. Accepting digital payments is important for small businesses, so we reviewed some of the most popular digital payment options for businesses below.

What are digital payments?

Digital payments transfer money electronically from one account to another, eliminating the need for cash or check. If you’ve ever used a mobile wallet or app to pay for a product or service, you’ve made a digital payment. Digital payments can be used at both brick-and-mortar and e-commerce stores. They are fast, secure and convenient payment options.

Did You Know?Did you know
The best credit card processors can help your business accept multiple payment methods, including credit cards, debit cards and digital wallets, with minimal fees.

Editor’s note: Looking for the right credit card processor for your business? Fill out the below questionnaire to have our vendor partners contact you about your needs.

Types of digital payment methods

Consider accepting these popular digital payment methods at your business. 

  • Credit and debit cards: Debit and credit cards are technically forms of digital payments. Note that rates and fees apply to your business when consumers use a credit card.
  • Mobile wallets: Mobile wallets securely store a customer’s payment details and are popular options for in-store, online and even peer-to-peer payments. Examples include Apple Pay, Google Wallet and Samsung Pay. Note that to accept mobile wallet payments in-store, merchants must have card terminals enabled with NFC technology.
  • Contactless payments: Customers using contactless cards and NFC mobile devices can pay quickly and securely at checkout with just a tap or scan.
Did You Know?Did you know
All NFC mobile payments can be made using a digital wallet, but not all digital wallet payments rely on NFC. Some mobile wallets support technologies like quick response (QR) code scanning or online payments.
  • Peer-to-peer (P2P) payment apps: Many people are familiar with payment apps like Venmo, PayPal and Cash App for personal use. Retailers are increasingly accepting these payments for online and in-store purchases. [Learn more about how to use Venmo for Business.]
  • Smart speakers: Consumers can use voice commands to make instant payments or purchases through smart speakers like Google Home, Apple HomePod and Amazon Echo. In fact, a survey conducted by Voicebot and Rain Agency found at least 26% of consumers have made at least one purchase by voice and 12% do so regularly.
  • Bank transfers and automated clearing house (ACH) payments: These digital payment methods are likely not options for typical online and in-store retailers. However, they are cost-effective and straightforward options for businesses that handle recurring subscriptions or invoices.
  • Buy now, pay later (BNPL) services: BNPL through services like Affirm, Klarna and Afterpay allows customers to purchase products or services without paying the full price upfront, instead making installment payments and repaying the balance over a set period. Merchants receive full payment upfront, minus any fees.
  • Cryptocurrency payments: If your customers use cryptocurrency, these payments are fast and cost-effective. “Crypto payments can be cleared and confirmed within minutes instead of two days, and the fees are significantly cheaper,” said Mabel Oza, adjunct professor at the University of Illinois at Chicago and founder of ChaChingSocial. “If I were to use Stripe for payments, it would cost me 2.90 percent plus 30 cents per transaction while, in crypto, [with] transactions in chains like Solana, a transaction fee is [around 1/16th of a cent].”
  • QR code payments: QR codes often support digital wallets, but they can also be a stand-alone digital payment option. They are particularly effective in restaurants: Customers can scan a code, pay for their meal and leave without waiting for a check and a server to handle their payment.
  • Subscription billing services: If your business sells monthly subscriptions, customers can pay digitally via platforms like Stripe and Square, which automate recurring payments.
TipBottom line
Read our Stripe vs. Square comparison to decide which service would best handle your subscription billing needs.

Considerations for businesses adopting digital payment methods 

Keep the following in mind when implementing digital payment acceptance.

Security

Here are a few methods and technologies being used to secure digital payments:

  • Biometrics: Biometrics authentication is a form of verification that uses physical characteristics to confirm a user’s identity. Many phones with digital wallets, like Apple Pay and Google Pay, use fingerprint scanners or facial recognition.
  • Encryption: Your payment processor should employ encryption to protect transactions throughout the entire payment process and ensure the security of sensitive payment information.
  • Tokenization: Choose a payment processor that utilizes tokenization, which is the process of replacing sensitive payment data with unique identifiers called tokens. Tokenization ensures that even if payment data is intercepted, it can’t be used, as tokens are meaningless without the payment processor’s system to decrypt them.
  • Payment Card Industry Data Security Standard (PCI DSS) compliance: All merchants must adhere to the PCI DSS. These security standards include ensuring secure networks, robust access controls and more.
  • Two-factor authentication (2FA): Two-factor authentication adds an extra layer of security by requiring an additional verification step, such as requiring customers to retrieve and input a code sent to their phones.
  • Secure payment gateway: You’ll need to set up a secure payment gateway with your payment processor. This technology creates a secure connection between your business’s website and the credit card processing company for online payments when a credit card is not physically present.
Did You Know?Did you know
Investing in credit card fraud detection and monitoring tools can help prevent unauthorized transactions and chargebacks.

Payment processing tools

If you want to accept digital payments in your brick-and-mortar or e-commerce store, you must have the right equipment. Consider the following:

  • The right POS system: Your POS system must be able to accept the payments you want to support. Many systems go beyond payment acceptance to provide inventory management, customer loyalty programs, employee tracking and more.
  • Payment processing terminals: You’ll need modern card terminals to accept contactless payments, such as those made with NFC-enabled mobile wallets or contactless credit cards. These devices support tap-to-pay functionality, ensuring a fast and seamless checkout experience. (Your POS platform should provide the equipment you need.)
  • Mobile POS systems (mPOS): Mobile POS systems are tablets, smartphones or proprietary wireless devices that use an app and a card reader to process payments. Many of the best POS systems include mobile processing functionality, allowing you to accept digital payments on the go.
  • QR code payment support: QR code payments allow customers to scan, pay and go without waiting for traditional checkout processes. Read our review of Square and our Toast review to learn about POS systems that support QR code payments.
  • Virtual terminals: Virtual terminals are software-based platforms that allow businesses to accept digital payments without physical hardware. They’re particularly useful if you accept credit card payments over the phone

Why your business should accept digital payment methods

Accepting digital payments positions your business as professional and modern while showing you’re attuned to your customers’ needs. Consider the following additional benefits:

  • Meeting customer needs: Ben Richmond, managing director at Xero, emphasized the importance of accepting digital payment methods to accommodate customer preferences: “Providing customers with the flexibility to pay the way they want helps businesses get paid faster, retain customers and ultimately grow.”
  • Providing a better CX: Digital payments are more convenient, improving the customer experience. Patrons can make payments with just the swipe or tap of a card rather than needing to bring cash or checks.
  • Enhanced security: Digital payments are also more secure, ensuring your customers’ confidential payment information is kept safe.
  • Lower expenses: Digital payment methods are often cheaper for businesses to process. They have low transaction fees and much faster processing times. Plus, digital payments can streamline the checkout process, meaning you’ll need fewer employees to meet customer demand.
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Written by: Sammi Caramela, Senior Writer
Sammi Caramela is a solopreneur who has spent nearly 10 years using her first-hand experiences to help aspiring entrepreneurs and business owners understand all facets of running a business. With her management experience, she is adept at examining the business world from both the employer and employee perspectives. At business.com, the versatile Caramela covers a range of business topics, including accounting, marketing and workplace issues. Caramela's expertise has been highly sought after by the U.S. Chamber of Commerce, 24/7 Wall St., and other organizations and outlets. She is also a published fiction author and poet.
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