Credit cards suck! Offer some alternatives

By Steve Outing

Credit cards suck for many reasons. (One that annoys me the most is the absurdly high late charges I’ve personally experienced for being a day or two late getting my bill in on time.) But in the physical world, and in certain situations in the online world (e.g., Amazon.com, which can store my account information), they are awfully convenient.

But for paying for low-priced digital content, credit cards largely suck because the fees are too high for online publishers to use them on small amounts without some sort of aggregation system to bill multiple small purchases together, as Apple does with its iTunes accounts when you buy 99-cent songs (and there’s no need for entering a card number more than once).

So it’s a pet peeve for me when I see some media website selling content or subscriptions, and the only payment option is using your credit card, and typing in all your information for the transaction to go through. My peeve is less about the cut that the credit card companies take form the site owner (though it is outrageously high, typically!), than about how much time and bother it takes the buyer to make a small purchase when the required payment method is a credit card.

Online users do not have a lot of patience, and usability experts who’ve studied this will tell you that to get lots of online users to do something (like pay a bit of money for some premium content, or make a donation, etc.), the process must be quick and simple. Typing in card number, expiration date, name on card, security code, e-mail address, postal code, and phone number is not something that you want to ask online users to do very often.

Long credit card donation formThis little rant comes courtesy of me spotting this donation pitch (at right) from the Bay Citizen, the new non-profit online news enterprise covering the San Francisco Bay Area and financed by Warren Hellman, which launches on May 26 under the editorial leadership of Jonathan Weber (ex-NewWest.net and the Industry Standard). Pre-launch, Bay Citizen is looking for “founders” to commit either one-time or repeating donations, and it has this lengthy form for you to fill out.

The sole payment option: your credit card!

Especially for non-profits, those donation forms should be effective at collecting money. A long form like the Bay Citizen’s just gives an excuse for a potential donor to click away rather than spend several minutes filling out a form. But the same goes for for-profit media sites.

How about doing the obvious, web publishers: Offer some choices! Let your contributors or purchasers have multiple options: Paypal, Google Checkout, and more media-centric payment systems such as Zuora and others.

While I can buy a burrito at Chipotle and the counter person swipes my card and hands me a receipt (not even a signature required any more), too many media websites force me to spend precious time filling out long forms like the one on this page (click to enlarge it).

It’s got to be made simpler and faster in the online marketplace!

4 Responses to "Credit cards suck! Offer some alternatives"

  1. Rob Dickens
    Rob Dickens 4 years ago .Reply

    Check out http://www.wepay.com for a great way for groups and non-profits to collect payments.

  2. Allan Hoving
    Allan Hoving 4 years ago .Reply

    PayCheckr.com coming to the rescue! :-)

  3. Samer Forzley
    Samer Forzley 4 years ago .Reply

    Steve

    This is a great post, and you raise a couple of issues, the first is the credit card rates, and I think every one agrees, the rates are very high, and with the recent changes in regulation, they are going to get higher.

    Issue number 2 is the amount of data one has to enter. Believe me I am not defending the cards at all, however at issue is a) consumer/merchant protection b) built in systems/processes. Online when you run a transaction, merchant have to verify, to make sure that you are who you say you are, and to make sure they are not going to be stuck holding the bag for a fraud transaction. In case of a fraud transaction a chargeback can be created which will cost both the consumer and the merchant money/headaches. Further there is the issue of built in systems and processes, payment processors as well as order management systems have been designed to collect and process this type of information and unless the systems are changed, merchants must collect this data.

    The point you make about donations maybe true on the surface, however and sadly those intended on doing fraud transactions online, happen to be good donators, why? Because they run a stolen card on a charity site, which takes the money, and in many cases since the industry is someone connected, enters the card numbers in a positive database. Once the card is in a positive database, the fraudster can then turn that $5 nice donation into a handy profit by going to an eCommerce site and having a shopping spree, since the card is now considered good, it will likely pass a fraud check even if the IP does not match the bill to and ship to addresses.

    There are other options online, example http://www.ebillme.com allows you to pay from online banking or at a walkin location with cash. You dont pay interest, you dont sign up, you dont exchange any financial information, and you surely dont type in any credit or bank account numbers.

    Alternative payments are becoming more common, and you are likely to see some of them on eCommerce site

  4. Kesha @small business website design

    Hey Steve, cool blog!

    I like the vyou video functionality…very cool :-)

    I just told a (non profit) client of mine just the other day that “Online users do not have a lot of patience!” If fundraising is the goal we have to give people as many options as possible to fork over their contributions :-)

    Otherwise, they’ll leave faster than flies! :-)

    ~Kesha

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