I have been through this dilemma many times with new apps. So finally I'm seeking some help. So when the app is new and in the process of gathering more users, is it good to let them use the app without even signing up and once they want to make payments or book something then asking them to sign up?

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    I'm not sure why it's a dilemma. What would your rationalisation be for forcing users to sign up and provide their payment details before they've even been able to look at anything? If you go to a shoe shop does someone on the door take your details and credit card information before they'll let you through the door or even look in the window? – JonW Aug 19 '14 at 11:35
  • Its completely understandable in e-commerce apps, but apps like Uber or something similar, they take your details upfront. Whats your take on that? – Sokratus Aug 19 '14 at 11:54
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    My take on it is that, as soon as you introduce a barrier to entry (and it could be as simple as a tickbox to proceed, up to a full personal data entry form) then not everyone is going to proceed past that barrier. The more complex the barrier the greater the drop-off rate. – JonW Aug 19 '14 at 12:02

The answer is progressive engagement. You delay the sign-up until the user needs to (e.g. save selected items, use shopping cart etc.). The initial sign-up must require information that is absolutely necessary (no credit card). Only when the user is ready to buy ask for a credit card.

The following article by Joshua Porter explains it in more detail :

Design for Sign-Up: How to Motivate People To Sign Up For Your Web App

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