E-commerce payment

Updated: 10/29/2015

When shopping online, there are several ways to pay for your product. Here are a number of payment methods that are common when shopping online, as well as some tips on what is good to consider. 

Debit card/Credit card

Paying by credit card is an option offered by most online traders. The difference between a debit card and a credit card is that a credit card is linked to a bank account and it is charged immediately on purchase, while a credit card payment can be compared to a loan that you pay afterwards.

Please note that if you choose to pay with a credit card you can turn directly to the creditor with your claim, should your products not be delivered within the agreed time.

Things to consider:

  • Do not give out any financial information over an insecure connection. A secure connection means that communications cannot be "intercepted" by a third party. Make sure that the website begins with https://.
  • It is good if the company has a so-called SSL certification. A certificate should be clearly visible on the website. The SSL creates a channel between two computers. When you are sending data to the server it will be encrypted. SSL also adds digital signatures to identify the server and users.
  • Many banks now offer services to implement secure card payments online. It can for example be done by a virtual copy of your card that can only be used for a pre-registered purchase. Contact your bank for information on secure card payments online.

Bank transfer

Bank transfer is a common payment option for cross-border trade. If you are paying by bank transfer, you do not disclose sensitive information. As the Consumer Credit Act does not apply to bank transfers, you do not have the same consumer protection as when you pay with a credit card.

Cash on Delivery

You may at times be offered to pay for goods in connection with the acceptance of it. You will avoid the risk of having paid for a product that is then not delivered. However, this option generally cost more than payment in advance. Cash on Delivery is not as common in Europe as in Sweden.

Remittance services

There are a number of secure remittance services online. The most well known is PayPal and Western Union. PayPal is an option that can be considered safe and used by several well-established e-commerce companies. Western Union offers mainly transfer services to people who already know each other and their service is therefore not suitable for commercial purchase.

Payments and deliveries can be problematic. Sellers and buyers do not often know if they can trust each other. Therefore, many prefer to use payment intermediaries, especially in the case of expensive purchases. Unfortunately, sometimes scammers pretend to be a remittance service. You should do steady research before hiring an escrow company.