For some, one of the biggest barriers to shopping online may have been a very simple one: the tendency for online retailers to only accept credit card payments. Today, the Associated Press reported that new trends include an increased willingness to invoice as well as accept what many see as an old-fashioned route, paying by check.
OK, so the act of writing out checks is so... so last decade, maybe, considering that so many of us are willing to lay down the plastic these days, and especially considering the fact that debit cards are taken just about everywhere.
A pioneer in online payment flexibility was eBay (NASDAQ:EBAY), with its PayPal service. One might even argue that PayPal has been a differentiator that has helped eBay become entrenched in mainstream society. Meanwhile, for instant gratification at sites like Amazon.com (NASDAQ:AMZN), for now, think credit -- if you pay by check, you can expect to wait two to three weeks for your delivery, and that's a long time, by Internet standards.
Then there are online subscriptions. Netflix (NASDAQ:NFLX) would have been a good example of the old way. Now sign-up includes a new option that includes e-checking through Certegy (NYSE:CEY) -- more like debit than a traditional check. TiVo (NASDAQ:TIVO) still requires that subscribers use a credit card to pay for their monthly subscriptions.
Among the new revenue channels the Associated Press article cited included consumers who, for various reasons, do not have credit cards. Add on the elderly folks who still fear online fraud too much to punch in their credit card numbers over the Net.
However, there are several other factors at work here, too, that make it essential for the big names in e-commerce to embrace other payment methods. Considering the years of easy, ballooning consumer credit, many consumers are likely trying to pare down their balances in light of possible continued interest rate hikes. (And if you need help, be sure to visit our Credit Center for lots of tips on getting your debt under control.) Of course, it should come as no surprise that credit card fees are already on the rise.
Meanwhile, hackers are getting more serious all the time about ways to try to get your account information over the Net. At some point, security flaws could represent a huge barrier to new online customers -- or even cause a defection from current online shoppers.
Sometimes, progress seems like a step backward. However, being open to alternative (and seemingly anachronistic) ways of paying for services is likely to boost online retail as attitudes change.
Read more about the pitfalls of heavy credit reliance in Stupid Credit Tricks, by Dayana Yochim. Or, get tips from other Fools on the Consumer Credit/Credit Cards discussion board.
Alyce Lomax does not own shares of any of the companies mentioned.
