One of the little perks of running an eCommerce business is not having to deal with cash. Traditional business owners face hours of counting, bagging up and paying in money to the bank. But Ecommerce store owners are able to completely bypass this aspect of business.
Still, when it comes to money, you want to be sure that the company you choose to process your online transactions is reliable, secure, and cost-effective. There are a lot of companies offering such services for small to medium sized eCommerce operations. So how do you know which one to go with?
There are a key four factors to consider:
- Cost. Of course, you don’t want to be paying over the odds every time you process a payment or pay a supplier. And watch out, some online payment processing companies may charge up-front costs as well as ongoing costs (such as a subscription fee), so make sure you know how much you’re paying and what you’re getting for it.
- Compatibility. Not all payment processing companies are compatible with all shopping carts. This means that, before you set your heart on a particular provider, make sure to check whether you’re able to use them. If they’re not, look elsewhere or else change your shopping cart (alas, easier said than done).
- Service. Money can be an extremely stressful subject. Indeed, for most business owners, it has been at the centre of too many problems. So when things go wrong, you need to know that there’s somebody available to help you. What you need is quick and high-quality After all, yours and your customers’ hard-earned money is at stake.
- Chargebacks. It is an unfortunate fact, but we live in a world where fraud exists. And many fraudsters’ favourite hangout is the internet. By default, as an eCommerce business owner, you’re at risk from fraud, so it’s important your payment processing company has measures in place to protect you.
So, just what companies are out? And which is best for you? Read our list to find out.
Ah, PayPal, perhaps the most well-known of all the online payment processing companies. PayPal owes much of its success due to its relationship with a certain online auction website. But PayPal is actually a whole lot more than a way to buy things off eBay.
PayPal is a fully developed payment processing system. It can be used to create and send invoices, make online payments, and accept any credit and debit card payments (as well as PayPal payments) made on your site.
The cost for a PayPal Pro account is just £20 a month, plus a per transaction fee depending on your monthly sales volume.
Additionally, PayPal Pro users receive a Virtual Terminal, which allows them to accept payments over the phone.
All in all, PayPal is a pretty safe bet.
Though PayPal may be better known, WorldPay is actually the UK’s leading payment provider, processing around 11 billion transactions a year and approximately 44 percent of sales made on the UK high-street.
So, yeah, they’re a pretty big deal. And they also happen to be pretty good.
The company offers two distinct payment options: Pay as You Go and Pay Monthly.
If you opt for the Pay as You Go option, you will be charged 2.75 percent plus 20p for transactions; whereas, on the Pay Monthly plan, you will pay £19.95 per month plus 2.75 percent for credit card transactions, and 0.75 percent for debit card ones. So, really, which of these plans you choose will depend very much on how many sales you make each month.
WordPay, as you’d expect from such an established company, offer great customer support as well as excellent fraud protection.
One drawback, however, is a lengthy application process. Still, you only have to do it once.
Stripe, a relatively new name in the UK, actually has a substantial market share in the US and Canada.
The company operates a simplicity first approach, and make sure that customers know exactly what they’re getting. This means no monthly fees, no refund costs, no set-up fees, no charges for fees in other currencies, and no charge for recurring payments.
Instead, Stripe simply charge a flat rate of 2.4 percent plus 20p per transaction. This makes it cheaper than both PayPal and WorldPay.
However, consumers like to stick with what they know. So until Stripe really starts getting some traction in the UK, in order to avoid putting customers off (especially if, say, you sell particularly expensive items), you may want to stick to the more familiar names.
Amazon Payments allows customers to login and pay for goods via their Amazon account. The biggest benefit of this is brand recognition: Amazon is the most popular eCommerce store in the world, and very few people are going to feel insecure making a payment through them. Still, it does limit customers to those who have an Amazon account – and, believe it or not, not everyone does.
It’s a good thing, then, that you can offer Amazon Payments in addition to another payment processing service, which should keep everybody happy. This means that, in theory, you should be able to enjoy the positives of using a well-known brand without isolating those who don’t use it.
Choosing which payment processing company is for you is not a decision to be taken lightly. It’s important that you make the right choice, since changing at a later date will mean a lot of upheaval and stress. And don’t just consider what’s best for you. Think about your customers, too. Make sure that they are comfortable with your provider, and that the service is easy to use from their point of view.
Which online payment processing company do you use? And why? Let us know with a comment! Over and out.