Are guest checkout payments safe?

What is guest checkout?

Guest checkouts are an option provided by online stores that allow customers to complete their purchases without creating an account or logging in with an existing one. Guest checkouts may streamline a purchase by requiring only essential information — such as payment and shipping details.

A guest checkout process usually follows the below steps:

• Items are added to the shopping cart.
• Guest checkout is selected on the checkout page.
• Billing, delivery, and payment details are entered.
• The purchase is reviewed and completed.

Potential reasons for using guest checkout

Shoppers may have various reasons for using guest checkout. They may not have time to enter in all information to create an account or may be using an alternative checkout method that autofills their details, such as Fastlane by PayPal.

• Avoid adding personal information: Someone might checkout as a guest to avoid storing personal login information on the merchant's website, such as passwords. This may potentially reduce the risk of account takeover in the event of a data breach.
• Avoid account creation: Using guest checkout bypasses the need to create an account. Some people may simply not want to have to remember another login or don’t want to receive marketing communications from the store or website.

Security considerations with guest checkout

It’s important to choose online stores with robust data security measures for guest checkouts.

Shoppers should check that online stores and marketplaces use modern encryption protocols and secure payment gateways. Be mindful that:

• Stores need to comply with data privacy regulations to safeguard shopper information.
• Established payment processors integrate encryption and fraud prevention tools for the security and protection of all transactions.
• Security measures are designed to help prevent unauthorized access to payment information and reduce the risk of online shopping fraud.

Guest checkout vs. account creation

There are a range of checkout options for shoppers today. These include:

• Merchant guest checkout: This option lets customers buy from a merchant’s website without creating an account and by providing only essential information needed for the transaction.
• Merchant account checkout: This is when customers create (or log into) an account on a merchant's website to buy what they want. People can then pay with stored delivery addresses and payment methods.
• Third-party account checkout: This option lets shoppers use their account with a third-party service, like PayPal, to complete a purchase on a merchant's site, potentially enhancing security and convenience.
• Third-party guest checkout: Much like Fastlane by PayPal, this option allows shoppers to save their payment details on their first initial checkout. Details are then securely saved and prefilled on future checkouts with participating retailers.

There is no "right" checkout; this choice can be personal and one that best suits customer needs around convenience and security.

For example, for a one-off purchase from a trusted brand and website, merchant guest checkout may suffice. For people who make frequent repeat purchases at the same stores, using merchant account checkout might be the option if they are loyalty program members. Similarly, a third-party account checkout may be useful if trying to earn rewards across stores or with a broader reward program, like PayPal Rewards.