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Pros and Cons of E-Commerce Payment



E-Commerce or Electronic commerce payment systems use electronicElectronic Payment payment methods like online transactions. These systems have transformed the money transaction processes by reducing the time consumed in paper work and the cost of labour, etc. It also helps market expansion due to its vast possibilities and global reach.

The speed and simplicity of such payment methods have made its use wide-spread, though it does include the risk of theft, etc.Methods of online payment are numerous, all with their own advantages and disadvantages – cards, e-wallets, bank transfer and cash on delivery.

Market for E-Commerce payment

The global e-commerce payment market is growing steadily at a compound annual growth rate of 16% with the credit going to the online shoppers. The market driving factor in this case is online shopping. The number of people who prefer to shop online increased by 20 million last year and is expected to grow even more with the number of transactions increasing by 115 million for last year alone. E-commerce is the future for shoppers whether we are talking about media, sporting goods, electronics, furniture, apparel and accessories or even health care. This system will continue to evolve with the expansion of payment methods. Social media and the 3G/4G network is also a factor for the rapid growth of these payment methods.

Advantages and Disadvantages of e-commerce payment systems:


  • Service is user-friendly as you only need internet access to make transactions anytime and anywhere.
  • Controls your expenses as you can easily keep a digital summary of all your expenses.
  • Saves a lot of precious time since online money transfer takes barely a few minutes and you do not have to waste your time in lines at banks.
  • Low transaction costs to be paid as the fee in these kinds of operations consists of around 1% of the total amount to be paid only.
  • Reduces risk of loss and theft as you cannot simply lose your virtual wallet and theft is impossible if you keep your personal information like PIN secure.


  • Loss of privacy of transactions as all the data is stored on the servers, keeping all the details of the transaction as well as the parties involved.
  • Restrictions on some transactions due to company policies on the number of transactions per day or the amount being paid in a month.
  • The risk of being hacked if you do not follow the security guidelines
  • Internet access is crucial to these transactions, or else you are locked out without money.


Payment methods like card payments and netbanking are also very popular due to being easy, safe and available 24x7. However the risks associated with it are also many, to avoid these risks customers should follow certain guidelines. A few tips of keeping e-commerce payment safe are – never to tell your personal details to anyone or write them down, keep changing your PINs and passwords, use strong passwords and be careful while using public handheld payment machines. Happy shopping!

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