Payment by request link, commonly referred to as “pay by link,” allows a business to send a payment request to a customer through a digital link. This link then takes the customer to a payment portal to complete the transaction. Various sectors, from retail to the service industry, have adopted this payment method, and it’s particularly gaining traction in regions with high mobile usage.

Pay by link systems are agile, often integrating multiple payment options in a single link to accommodate the diverse payment preferences of global customers. This enables these systems to support global credit and debit card leaders (such as Visa and Mastercard), region-specific local payment methods (such as iDEAL in the Netherlands, Alipay in China, and Pix in Brazil), and digital wallets.

The simplicity of clicking a link to complete a payment on any device aligns with growing customer expectations for convenience and speed in online transactions. Below is a comprehensive guide to how pay by link operates, including its application, scope, and financial nuances across different markets.

What's in this article?

• What is pay by link?
  
• Where is pay by link used?
  
• Who uses pay by link?
  
• How pay by link works
  
• Business benefits of accepting pay by link
  
• Pay by link costs and fees
  
• Pay by link security measures
  
• How businesses can accept pay by link
  
• How Stripe Payment Links can help
  

What is pay by link?

Pay by link is a digital payment method that allows businesses to request payments from customers through a shareable link. It’s useful for remote payments, since it eliminates the need for physical card terminals or a physically present card. Businesses can generate a payment link through their payment service provider and send it to their customer through various channels (such as email, SMS, or messaging apps). The customer can then complete the payment online through a secure webpage.

Pay by link supports a variety of payment options – including credit and debit cards, bank transfers, and digital wallets – depending on the payment processor’s capabilities. For small businesses or individual sellers, this is a simpler way of accepting payments without developing an e-commerce system. Adoption of pay by link has surged, particularly as the retail and service sectors have adapted to handle increased online interactions and contactless transactions.

Where is pay by link used?

• United States: In the US, businesses of all sizes use pay by link technology to streamline billing and collections, particularly in the e-commerce and professional services sectors.

• United Kingdom: UK customers have a strong affinity for pay by link solutions, driven by a high level of customer comfort with digital payment methods and a large e-commerce sector.

• Germany: German businesses – particularly in the automotive, healthcare, and retail sectors – are integrating pay by link methods for flexible payments. This trend is supported by a strong infrastructure for electronic payments.

• Brazil: Brazil is rapidly adopting pay by link, due to the country’s growing number of mobile internet users.

• Japan: In Japan, pay by link complements a range of other advanced payment options – particularly in international commerce.

• South Africa: Pay by link is becoming an important tool for South African businesses to reach a broader customer base, including the unbanked population. Its integration with mobile payments is key in a region where mobile usage outpaces bank account usage.

Who uses pay by link?

Both businesses and individuals use payment request links. These links are normally generated through a payment gateway and sent via email, SMS or other messaging platforms. They allow for a quick and secure transaction without the need for a physical point-of-sale (POS) system.

• E-commerce businesses and online retailers: Online retailers are among the primary users of payment request links. They offer customers a direct, hassle-free payment option.

• Service-based businesses: Service providers – such as consultants and freelancers – and professional services companies – such as law firms and marketing agencies – frequently use payment request links to bill for their services. This method is especially popular for invoicing and remote payment collection, serving one-time and recurring billing needs.

• Small and medium-sized enterprises (SMEs): SMEs choose to use payment request links for their low cost and ease of integration with their existing systems.

• Non-profit and charitable organisations: Non-profit and charitable organisations use payment request links to simplify the donation experience, boosting fundraising.

• Educational institutions: These institutions can accept payments efficiently without requiring in-person transactions, which is particularly useful for distance learning platforms.

• Healthcare providers: Healthcare providers have adopted payment request links to settle bills for treatments and consultations.

• Restaurants and food delivery services: In the food service industry, payment request links are a contactless alternative to traditional card payments.

• Artisans and craft markets: Individual creators and small-scale artisans use payment request links to sell their goods without a physical storefront or cash transactions.

• Real estate agents and landlords: Real estate agents and landlords use payment request links for secure deposit and rental transactions, reducing the need for face-to-face meetings and handling physical checks.

How pay by link works

Payment request links, while simple for the user, involve a complex network of operations to ensure secure, reliable, and efficient payment processing.

The process begins when a seller generates a payment request link through their payment service provider’s interface. This link contains the required payment information, such as the numerical amount and the currency. When a customer clicks this link, they’re directed to a secure payment gateway where they can complete the transaction.

Once customers have submitted their payment details, the transaction information is encrypted and transmitted through the payment gateway. The data is then routed to the acquiring bank, which forwards the transaction requiring authorisation to the card network, such as Visa or Mastercard, which in turn communicates with the issuing bank.

Following authorisation, the pay by link system facilitates the clearing process, where transaction details are confirmed between the financial institutions involved. Settlement – the actual movement of funds – usually occurs later, often on the same day or on the following working day.

Business benefits of accepting pay by link

Expanded customer reach

Payment by request links are easily accessible and convenient, enabling businesses to connect with a broader audience. Businesses can share these links via email, chat or social media, so that customers can make payments anywhere and at any time. This is particularly beneficial for markets with high rates of digital banking adoption and customers who are accustomed to online transactions.

Transaction speed

Once a customer clicks on the payment link and enters their payment information, the payment is processed almost instantaneously. This increases cashflow for businesses, as they can receive payments without significant delays.

Enhanced security

Payment by request links are designed with security as a core feature. These payment system providers adhere to stringent security standards, such as PCI DSS, and incorporate encryption and other protective measures to safeguard personal information.

Access to customer insights

With each transaction, businesses gather valuable data that they can use to understand customer preferences and behaviour. Pay by link systems can track payment patterns, frequency, average transaction values and other metrics. This data can help businesses to customise their services and marketing efforts to better meet customer needs.

Flexibility in payment acceptance

Businesses that employ payment links can accept a wide range of payment methods, from credit and debit cards to digital wallets. This versatility allows businesses to cater to a customer base's diverse payment preferences.

Operational efficiency

Integrating payment links into a business's operations can improve efficiency. Automating invoicing and accounting practices is possible with APIs that connect payment systems to business software. This integration can reduce manual errors and save time doing back-office operations.

Customer loyalty and engagement

Payment by request links can increase customer engagement by including loyalty rewards and discounts in the payment process. These incentives can be a powerful tool to build a loyal customer base and encourage repeat customers.

Customer preference for digital payments

Statistics reflect a growing preference for digital payment solutions. Digital payment methods are on the rise, with the global mobile payment market projected to grow from $4.97 trillion in 2025 to $26.53 trillion by 2032. Pay by link systems are well-positioned for customer adoption, offering the convenience and security that modern customers are seeking.

Pay by link costs and fees

When businesses adopt pay by link systems, they are subject to various fees. These fees can vary based on provider, region, and the specifics of the transactions. Here are the common categories of fees:

• Transaction fees: Each payment processed through a payment by request link typically incurs a transaction fee. Payment processors often charge a percentage of the transaction amount plus a fixed fee.

• Monthly and annual fees: Some payment by request link providers charge monthly or annual service fees for using their platform.

• Chargeback fees: Chargebacks occur when customers dispute a transaction. Businesses may incur additional fees when handling these disputes, which can include the cost of the chargeback as well as an additional administrative fee imposed by the provider.

• Cross-border fees: These fees compensate for the costs associated with currency conversion and the increased risk associated with cross-border transactions.

• Integration fees: If a business requires specialised integration of the pay by link system with its existing operational software, there may be fees for the development and maintenance of these integrations.

Customers also encounter fees when using payment by request links, although these tend to vary less than the fees for businesses do. Customer fees generally include:

• Foreign transaction fees
  
• Cash advance fees
  
• Late payment fees
  
• Annual fees
  

Pay by link security measures

Pay by link systems take various measures to ensure the integrity of transactional data and protect financial information.

• Encryption technologies: Payment by request link providers use advanced encryption to protect data in transit and at rest. They secure data in transit with TLS protocols and encrypt stored data using AES with key lengths of at least 128 bits, following industry standards.

• Tokenisation services: Tokenisation is a core security feature that substitutes sensitive card details with unique identifiers. This process ensures that actual card numbers are not stored or transmitted during transactions, reducing the risk of data breaches.

• Advanced risk assessment: Providers use real-time, machine learning – driven algorithms to analyse transactions for fraudulent patterns, continuously improving their ability to detect and mitigate threats.

• Multifactor authentication protocols: Customers may be required to provide a second form of identification, such as a one-time passcode sent via SMS or generated through an authenticator app.

• Biometric authentication: Pay by link systems are increasingly adopting biometric verification methods, such as fingerprint scanning, facial recognition, and voice authentication.

• Compliance with global regulations: Pay by link providers adhere to a range of international and local regulations. For instance, the General Data Protection Regulation (GDPR) in the European Union sets stringent standards for data handling and privacy, while the PCI DSS provides a global benchmark for payment card data security.

• Monitoring high-risk sectors: Providers also customise security measures for businesses in industries with elevated risk profiles, such as healthcare and financial services. Improved due diligence processes and additional security layers might be required to address the specific threats faced by these sectors.

• Customised security features: Businesses using pay by link systems can often access customised security options. For instance, corporate clients may benefit from configurable spending controls and real-time alerts to monitor and manage corporate expenses.

How businesses can accept pay by link

Allowing customers or donors to pay via pay by link isn’t difficult, but it does require a few steps. Here’s how businesses can do it.

1. The business generates a payment link using their payment platform.
   
2. The business shares the link anywhere – in an email, text message, or social media post. The same payment link can be shared with multiple customers.
   
3. The customer clicks on the payment link.
   
4. The link redirects the customer to a secure payment page where they can complete their purchase.
   
5. The customer chooses a payment method (such as a credit card, digital wallet, or bank transfer) and enters their details.
   
6. The business receives a notification that the payment was successful.
   

Whether you’re creating one-off payment links or configuring payment links at scale for an automated marketing campaign, it’s a quick process for both the business and customer.

How Stripe Payment Links can help

Stripe Payment Links is a no-code solution that allows you to quickly create and share secure payment pages online.

Payment Links can help you:

• Get paid faster: Share custom payment links with customers and accept one-time or recurring payments instantly, without invoicing or complex integrations.
  
• Improve conversion: Boost payment conversion rates with a mobile-optimised design and streamlined checkout experience.
  
• Save time: Easily create, customise, and share payment pages through the Stripe Dashboard – with minimal coding.
  
• Expand globally: Accept payments from customers worldwide, with Adaptive Pricing localising prices for 135+ currencies and offering local payment methods that are ready to use.
  
• Access other Stripe products: Integrate Payment Links with other Stripe products – such as Stripe Billing, Stripe Radar, and Stripe Tax – to add more payment capabilities.
  
• Maintain control: Customise the look and feel of your payment pages to match your brand, and track all your payment activities in one place.
  

Learn more about how Payment Links makes it easy to accept online payments, or get started today.