Payment methods: How to pay online securely & conveniently

You can pay the invoice in a range of ways when shopping online. Besides the familiar payment methods, such as direct debit or credit card, new, special payment systems for online shopping have taken hold. This is because it’s just too longwinded to go filling out your bank details or grabbing a credit card for small amounts. Mostly, all it takes is a click and the money is as good as with the retailer. Here’s an overview of the key internet payment systems, including their upsides and downsides.

From good to bad: Popular online payment methods

Invoice: The most secure method

You pay once you receive the goods and have checked that they’re all in order. Typically, the invoice is then paid by bank transfer.

+ Very secure

– Really longwinded

– Only a few retailers offer this

PayPal: Simply practical

PayPal doesn’t just offer secure money transfers, but also Buyer Protection where PayPal will reimburse you if the eligible item doesn’t arrive or doesn’t match the seller’s description. However, you first need to register for the service at www.paypal.com before you can pay online using PayPal. To pay, you can add a credit card, enter your bank details for direct debit, or top up your PayPal account with credit. Sensitive data is not transferred during the payment process. Plus point: A growing number of online shops are offering the Express Checkout option where the retailer also receives your delivery address details from PayPal.

+ Secure

+ Convenient

+ Widespread

Amazon Payments: Pay using your Amazon login details

Practical: Many shops offer Amazon Payments. You just need to click the button and enter your Amazon login details. Payment is by direct debit. The retailer also receives your address details. To pay using Amazon Payments, you need to have stored your banking details and address in your Amazon account.

+ Secure

+ Very convenient

– Only a few retailers offer this

– Need to have an Amazon account

Direct debit: The classic way to pay

You permit the retailer to debit the amount due from your account. To do so, you provide your account details and your consent. In the case of unjustified transactions, you have a certain period of time in which you can dispute them – which can take up to six weeks, depending on the bank. You’ll then get your money back.

+ Convenient & secure

– Only a few retailers offer this

Credit card: Great protection

It’s so easy: Enter your credit card number, validity date, and verification code – done. Although there are occasional cases of fraud, you can dispute unjustified credit card transactions.

+ Good customer protection

+ Widespread

– Credit card fees 

Cash on delivery: Expensive and nonsensical

With cash on delivery, you pay once the courier has handed over the goods. The positive aspect is that you don’t have to go sending any sensitive data over the internet to the retailer. The negative aspect is that retailers often demand hefty additional fees. Furthermore, cash on delivery doesn’t offer you any guarantee that you’ll actually get what you ordered as you’re not allowed to open the parcel beforehand to check what’s inside.

+ Convenient

+ Secure

– High fees

– Only a few retailers offer this

Prepayment: Only good for the retailer

Avoid it at all costs! With this method you first receive an invoice which you then need to pay such as via a bank transfer. This means you’re transferring the money to the retailer before you even get a whiff of the product. There’s no guarantee that you’ll get what you’ve ordered, so if the retailer goes bankrupt you’ve also got virtually no chance of seeing your money ever again. On top of all this, you need to factor in long delivery times as to transfer the money alone can take anywhere up to three days – and the goods won’t be shipped until the money’s been received.

– Insecure

– Long delivery times

Learn about your rights if an order turns out to be a turkey in the fifth part of our series.

This post is also available in: German