How To Choose the Perfect Payment Gateway for Your eCommerce Site
Cash only, credit cards, debit cards, an iPad connected to a card reader — even bricks and mortar shops face a plethora of payment options when they’re getting started. Yet, for ecommerce businesses, the decision is even more confusing and critical to their success.
How do you find an affordable payment gateway which will make your potential customers feel secure? Is PayPal enough? What sort of security do your payment options offer? Are your customers’ details safe? What do all of these acronyms mean? Can you use more than one payment gateway?
Getting set up online is a pretty perplexing process if you’ve never done it before, and sorting out how you’re going to take payment is often at the very bottom of a long to do list. If you’ve reached this point, don’t panic. Our guide to payment gateway best practice will have your virtual cash register jangling in no time…
The Big Four
Before you go any further, there are four crucial factors you need to know about. No two payment gateways are identical, so you need to be able to distinguish between your options in order to find the right solution for your business. Make sure you understand and look out for the following features — think of this as your basic payment gateway shopping list!
1. Accepted payment types
The more credit cards, debit cards and payment methods your payment gateway can handle, the better your ecommerce site will convert. There’s nothing more frustrating for customers than researching a product, getting to an online checkout and finding the seller doesn’t accept their card. These days it’s essential to have at least credit cards, debit cards and popular online payment methods like PayPal up and running.
Even if your preferred gateways do take a wide range of payments, make sure they take them in the conventional “on page” form, instead of making customers link the gateway up to their bank accounts. This process isn’t just long-winded and off-putting for buyers, it’s also less-than-ideal from a security perspective.
2. Transaction fees
Again, there’s a huge amount of variation between payment gateway providers when it comes to transaction fees. Usually you’ll pay a flat monthly or yearly fee for your gateway and a fee for each transaction on top of this rate. The option you choose will depend on the shape, size and turnover of your business.
3. On form payments
When your customer reaches your website’s payment page, you may have chosen to use a pre-built form which has been integrated with your gateway. Sometimes this is where collection will be taken, but in some cases your customer will be whisked off to your payment gateway’s page to finish their payment. This may not very good from a trust and confidence perspective, making buyers feel nervous about entering payment details if they are redirected to an unrecognised card provider. However this could also be a benefit. PayPal is widely recognised and in some cases adds an extra degree of trust to your brand rather than entering card details on-site. Consider carefully your target customers and what kind of brands they are likely to recognise and how security conscious they may be.
4. Security
This is a huge, huge concern for both ecommerce stores and their customers at the moment. With data theft rife and Google now offering ranking incentives to websites who upgrade from http to https it’s more important than ever before to choose a payment gateway with adequate security features and to offer a secure log in to your website as I discussed in a recent blog.
Once upon a time, many ecommerce businesses considered now essential security features to be too much hassle, today everyone is wising up and getting serious about payment gateway security. Even for those of you using PayPal alone, SSL certificates are now essential. The must-have security kit to look out for includes:
- Strong data encryption
- SSL certification support
- Billing addresses for all transactions
- CVV2 verification
Is the price right?
Now you have your shopping list of essential features, it’s time to find the right deal for your business. As mentioned above, fees vary widely between gateways so look out for handy comparison sites and do your homework before you go ahead. You’ll normally encounter a combination of the following three charges:
Set up fees
These are one-off costs involved in getting your website hooked up with your chosen payment gateway. In some cases set up will be free or factored into later charges.
Yearly or monthly fees
Some gateways take a monthly or annual subscription fee. This fee will usually vary depending upon the size and type of your business.
Transactional fees
Other gateways will charge you a transaction fee either instead of (or in addition to) a subscription fee. These transaction fees are either:
- A flat rate per payment
- A set percentage per payment
- A combination of flat rate and percentage per payment
Making it your own
I spoke a little about using on form payments earlier as a way to maintain customer trust and to make sure you don’t put off imminent customers with a switch to a website they don’t recognise. However, even on form payments can look a little unfamiliar (they usually come in the form of a code you can include in your website provided by your gateway guys).
Lots of businesses (particularly those with strong branding and decent budgets) will want to make their payment page look like the rest of their website. This will require processing APIs for developers to use and site testing to make sure everything’s running smoothly. If you’re keen to integrate your payment gateway cohesively into your website, make sure your gateway provides both of these services.
Caring for your customers
A final variation between gateways which you need to be aware of is the level of customer support provided by your payment gateway. Some offer 24/7 support via phone and email, others don’t offer anything close to this level of assistance. As a rule, the better the service, the higher the fees. But can you put a price on customer confidence and customer care? If you are unable to resolve customer payment queries quickly due to poor customer service from your payment gateway you may end up loosing sales. A good experience could mean repeat custom and recommendations, a bad experience could mean nasty online publicity.
Should you use multiple payment gateways?
As a general rule of thumb, sticking with one good quality payment gateway which accepts a comprehensive range of payment types and provides and versatile, flexible service is worth the money. Choosing a couple of cheaper gateways to increase the number of payments accepted without breaking the bank is not usually the best idea. It’s often difficult to integrate more than one payment gateway neatly into a payment page which can be a big customer trust buster.
However, in some cases, particularly for international businesses where a broad range of unusual currencies and payment types are used, multiply payment gateways will be inevitable. Again, security and customer care should be paramount — particularly where international payments are concerned. In a nutshell, if you’re using multiple gateways, don’t do it to scrimp and save — only do it to boost functionality.
Which payment gateway do you use? Please share your recommendations with us.
