Whether you’re selling or buying, you need a way to exchange money for services and goods. You can conduct online transactions by using a variety of payment methods.
Credit cards are the most common method of payment. Credit cards offer the possibility of a credit line where you can take out up to a specific amount. When you make a purchase with your card the transaction is sent to the bank for processing. The bank verifies all the information and sends the authorization back to merchant. The merchant can then accept or decline the transaction.
Another popular method of payment is an ACH (Automated Clearing House) or wire transfer. These are electronic transfers that usually require one or more days to complete. These transfers may be domestic and international, and may require additional information such as the routing number.
Today, a large number of people discover and buy products from social media platforms. Using features like in-app checkout and shoppable content, these platforms offer a convenient and simple way to purchase directly from brands.
The popularity of social platforms has prompted companies to develop alternative methods to facilitate online payment. These types of newer payment include cryptocurrency and digital currencies, which function in a similar way to traditional currencies but have the added benefit of anonymity and cryptographic verification. The rapid growth of these technologies reveals how the infrastructures supporting online transactions are evolving and are becoming a larger class of information called transactional.