Wednesday, March 27, 2019

Dropshipping has been in the business of retail and e-commerce and continues to grow over time. There are people who want to have their own dropshipping business yet does not have good credit.  Most drop shipping sites have monthly subscriptions. Our post today will discuss what payment methods can be used in dropshipping.

Do I need a credit card for dropshipping?  Yes, you need a credit card for dropshipping because most sites have monthly subscriptions.  Also, when buying products, your suppliers may ask for your credit card information to process your orders.  But, there are other payment methods available like a debit card and PayPal.

What if I do not have good credit, how can I do dropshipping?
Earlier, we talked about using a credit card when doing drop shipping.  It is true that we need a credit card for most transactions. In addition, you will maximize your credit card by earning points and rewards out of the purchases made in dropshipping.  But does this mean that those without credit cannot have a dropshipping business? The answer to this is, no.

You may be a student without credit or may have spent over the limit, or just someone who does not believe in the perks of credit cards. I tell you, this is not going to be a problem if you want to do dropshipping now, or maybe in the future.  There are other payment options available that you can use to continue dropshipping. Let us discuss them one by one.

Debit Card Transactions
Your first option is to use a debit card transaction.  This could be your Mastercard, Visa, even Amex debit card.  One good thing about using a debit card is that it is as good as cash.  The payment posts real time and is deducted from your available balance.  No fees, or interest that will show up on your bill.

Secured Credit Card
A secured credit card works like a regular credit card but you need to have a refundable amount to deposit in exchange of the credit limit.  If you are one who does not have good credit, you can use this and build a credit history and improve your credit. Works win-win, you get the drop shipping business going, while building credit.

PayPal Account
PayPal is a form of payment facility that has been established for years already.  You can register your account online and use this to transfer, send, receive money and pay other establishments online.  PayPal accounts may be linked to a credit card, checking account or debit. Some businesses prefer using PayPal as a form of payment because of their convenience and security.

Some suppliers would still receive checks payment being sent out especially those who are traditional.  One of the disadvantages though is that checks usually take time to deliver, possibly days to weeks. Also, takes a day or two to clear from your bank.

Why prefer using a credit card for dropshipping transactions?
Why prefer using a credit card for dropshipping transactions?
Now as we get along this post, let us talk about why a credit card is preferred in dropshipping transactions.
  • When you order something from a supplier, it will be more convenient if you use a credit card and pre-authorize the transaction.  This makes the transaction secured and fast.  
  • Credit card transactions do not require you to pre-pay any transactions and help you manage your expenses.  For businessmen, you do not want to be empty-handed and spend all your finances to just one single transaction.
  • Most drop shipping sites charge subscription fees. When you sign up for their services, it will ask for a credit card information to proceed.  This is one way to keep you from doing business with them.
  • When you use your credit card for dropshipping transactions, you will be spending thousands of money every month.  This means you get more points and rewards that you can use to possibly buy airline tickets, book a hotel and other freebies.  There are financial institutions that are designed for business purchases and helps you earn points or rewards.
To sum it up, it is preferred to use a credit card for dropshipping but is definitely not required.  But, if you do not have one, that’s fine. There are still other payment methods you can use for dropshipping.