Online Payment Methods for Invoices: Complete Comparison

Why Online Payments Matter for Your Business

Accepting online payments isn't just convenient—it's essential for modern businesses. Studies show that businesses offering online payment options get paid 30% faster and have 50% fewer late payments compared to those accepting only checks or bank transfers.

But with so many payment options available, which one should you choose?

Payment Methods Comparison Overview

Method	Processing Time	Fees	Best For
Credit/Debit Cards	Instant	2.9% + $0.30	Most businesses
PayPal	Instant	2.9% + $0.30	Freelancers, international
Bank Transfer (ACH)	3-5 days	$0-1	Large invoices
Wire Transfer	1-2 days	$15-50	International, large amounts
Checks	7-14 days	$0	Traditional businesses

1. Credit & Debit Cards (Stripe, Square)

How It Works

Clients pay with credit or debit cards through a payment processor like Stripe or Square. Funds are deposited to your bank account within 2-7 days.

Pros

• Fastest payment method: Clients pay instantly
• Highest acceptance: Everyone has a credit card
• Professional: Looks legitimate and trustworthy
• Automatic: Can set up recurring payments
• Dispute protection: Processors handle chargebacks

Cons

• Processing fees: 2.9% + $0.30 per transaction
• Chargeback risk: Clients can dispute charges
• Account holds: Processors may hold funds for new accounts

Pricing

• Stripe: 2.9% + $0.30 per transaction
• Square: 2.9% + $0.30 per transaction
• PayPal: 2.9% + $0.30 per transaction

Best For

Most businesses, especially those with invoices under $5,000. The convenience and speed outweigh the fees.

2. PayPal

How It Works

Clients pay through PayPal using their PayPal balance, bank account, or credit card. You receive funds in your PayPal account, which can be transferred to your bank.

Pros

• Widely recognized: Most people have PayPal accounts
• International: Accepts 100+ currencies
• Buyer protection: Clients feel secure
• Easy setup: No merchant account needed
• Mobile app: Manage payments on the go

Cons

• Higher fees for international: Up to 4.4% + fixed fee
• Account freezes: PayPal may hold funds without warning
• Disputes favor buyers: Can be hard to win disputes
• Transfer delays: 1-3 days to move money to bank

Pricing

• Domestic: 2.9% + $0.30
• International: 4.4% + fixed fee (varies by country)
• PayPal Business: Negotiable rates for high volume

Best For

Freelancers, international clients, small businesses. Great for clients who prefer PayPal over entering card details.

3. Bank Transfer (ACH)

How It Works

Clients transfer money directly from their bank to yours using ACH (Automated Clearing House). Takes 3-5 business days.

Pros

• Lowest fees: $0-1 per transaction
• No chargebacks: Once cleared, funds are yours
• High limits: No transaction limits
• Secure: Bank-level security

Cons

• Slow: 3-5 business days
• Manual process: Clients must initiate transfer
• Errors: Wrong account numbers cause delays
• Less convenient: Clients need your bank details

Pricing

• Most banks: Free for incoming transfers
• Stripe ACH: 0.8% (capped at $5)
• PayPal ACH: 1% (capped at $10)

Best For

Large invoices ($5,000+) where percentage fees would be significant. Also good for clients who prefer bank transfers.

4. Wire Transfer

How It Works

Clients send money directly from their bank to yours via wire transfer. Faster than ACH (1-2 days) but more expensive.

Pros

• Fast: 1-2 business days (same day for domestic)
• Large amounts: No limits
• International: Works worldwide
• Secure: Bank-level security
• Irreversible: No chargebacks

Cons

• Expensive: $15-50 per transfer
• Client pays fees too: $25-50 to send
• Manual: Requires bank visit or phone call
• Errors costly: Wrong details = lost money

Pricing

• Domestic incoming: $15-25
• International incoming: $25-50
• Client's bank (outgoing): $25-50

Best For

Very large invoices ($10,000+), international payments, or when speed is critical.

5. Checks

How It Works

Clients mail physical checks to your address. You deposit them at your bank.

Pros

• No fees: Free to accept
• Familiar: Traditional businesses prefer them
• Paper trail: Physical record of payment

Cons

• Very slow: 7-14 days (mail + clearing)
• Can bounce: Insufficient funds = no payment
• Lost in mail: Checks can get lost
• Manual: Requires bank visit or mobile deposit
• Outdated: Looks unprofessional to modern clients

Pricing

• Free to accept
• Bounced check fee: $25-35 if it bounces

Best For

Traditional industries (construction, legal), older clients, or businesses that prefer paper records.

6. Venmo & Cash App

How It Works

Peer-to-peer payment apps. Clients send money from their app to yours.

Pros

• Instant: Money arrives immediately
• Popular: Many people already use them
• Easy: Just need username/phone number
• Low fees: 1.75-3% for business accounts

Cons

• Unprofessional: Seen as casual, not business
• Limited protection: Hard to dispute
• US only: Doesn't work internationally
• Transaction limits: $2,000-5,000 per week

Pricing

• Venmo: 1.75% for business accounts
• Cash App: 2.75% for business accounts

Best For

Very small businesses, freelancers with young clients, invoices under $500.

Which Payment Method Should You Choose?

For Most Businesses: Credit Cards (Stripe)

Why: Fast, professional, widely accepted. The 2.9% fee is worth the convenience.

Setup: Create a Stripe account, add payment link to invoices.

For Freelancers: PayPal + Credit Cards

Why: Offers flexibility. Some clients prefer PayPal, others prefer cards.

Setup: Offer both options on your invoices.

For Large Invoices ($5,000+): Bank Transfer

Why: Saves hundreds in fees. 2.9% of $10,000 = $290 vs. $1 for ACH.

Setup: Include bank details on invoice.

For International Clients: PayPal or Wire Transfer

Why: PayPal handles currency conversion. Wire transfer for large amounts.

Setup: PayPal for under $5,000, wire transfer for over.

The Best Strategy: Offer Multiple Options

Don't limit yourself to one payment method. Offer 2-3 options:

• Primary: Credit card (Stripe) for speed and convenience
• Secondary: Bank transfer for large invoices
• Backup: PayPal for clients who prefer it

This gives clients flexibility while ensuring you get paid quickly.

How to Add Payment Methods to Your Invoices

Option 1: Payment Links

Include clickable payment links in your invoice:

• Stripe Payment Link: https://pay.stripe.com/invoice/...
• PayPal Invoice Link: https://paypal.me/yourname/1000

Option 2: Bank Details

Include your bank information:

• Bank Name: Chase Bank
• Account Number: 1234567890
• Routing Number: 021000021
• SWIFT Code: CHASUS33 (for international)

Option 3: QR Codes

Add QR codes that clients can scan to pay instantly via Venmo, Cash App, or PayPal.

Security Considerations

Protecting Your Business

• Use secure payment processors: Stripe, PayPal, Square are PCI-compliant
• Never store card details: Let processors handle it
• Verify large payments: Call to confirm before shipping/delivering
• Watch for fraud: Be suspicious of overpayments or urgent requests

Protecting Your Clients

• Use HTTPS: Secure website for payment pages
• Show trust badges: Display security certifications
• Provide receipts: Send confirmation after payment
• Clear refund policy: Explain how refunds work

Start Accepting Online Payments Today

Don't let outdated payment methods slow down your cash flow. Modern businesses need modern payment solutions.

Try InvoiceKit free and add custom payment instructions to your invoices. Include bank details, PayPal links, or any payment method your clients prefer!