As innovations are required to keep up with the demands of the connected world, alternative payment methods have become more popular than paying using traditional methods like checks or cash. Statistics reports of 2019 show that of all the online transactions, an astonishing 55 percent were done with the use of alternative payment methods.
As the payment method ecosystem continuously develops, so do the alternative payment methods. The online payment network sometimes requires that the banking institutions and credit card unions be tapped. These payment methods include mobile banking and using money services companies for email transfers.
Traditional fund transfer methods
The traditional payment methods like using the SWIFT network to send bank-to-bank payment is no longer the preferred international fund transfer by many. There was a time, not so long ago, that we had no choice but to use banking institutions for cross-border payments. The conventional methods of transfers by the banks are undergoing digital changes such as that of mobile banking to keep up with the times.
Peer-to-peer money transfers
There are peer-to-peer apps that enable a person to send funds both internationally and locally without using the banking network. One of the advantages of sending money using peer-to-peer apps is that the funds are credited to the recipient’s account instantly. There is usually a fee for sending money using this alternative payment method. But, the good news is that there is a money services peer-to-peer app that you can use to send funds for free.
Banking mobile technology developments are unable to provide innovative payment solutions. One of the reasons why is that the network established by the financial institutions for funds transfers and other transactions can no longer be applicable unless the remittance is sent instantly, like certain alternative payment methods. With open banking technology, there are alternative payment methods such as that of social payment apps that link their bank accounts for transactions.
Contactless payment terminals
There are payment methods wherein the funds do not pass through the conventional banking channels. Transactions are typically made through e-wallets. These digital wallets can store, send, and receive payments. These e-wallets are commonly used for scan-to-pay contactless terminals at offline retail stores.
Bitcoin and other cryptocurrencies
Paying using virtual money is now becoming more popular. Just a few years ago, cryptocurrencies like bitcoin were not accepted as a form of payment. Now, the value of one bitcoin is far higher than any banknote. Payment transactions can be made using bitcoin and other popular cryptocurrencies.
Preferred payment methods
For online merchants and offline retailers, it is necessary to have the preferred payment methods such as accepting cash. However, it is also possible for most businesses to integrate the alternative modes of payment as these are getting to be more popular than those that have been around for decades. It is vital for any company to be able to accept more alternative payment methods so that the customer will be able to choose the methods that they prefer.