Choosing an online payment provider

Choosing the right payment provider is an important decision for an eCommerce website owner. There are lots of different payment providers that offer different services and pricing structures. The right payment provider for you will depend on many different factors including customer preferences, the type of product or service you are selling and the number of transactions you expect to be getting.

Things to consider when choosing an online payment provider

These are the main factors to consider when choosing a new payment provider for your business.

1. Payment provider fees

One of the most important factors when choosing an online payment provider will be the overall cost of using the service. Fees will vary between different providers and may include setup fees, monthly fees, fixed costs per transaction and variable fees based on a percentage of each transaction.

In addition to the fees for using the service, many payment providers will charge extra for things like international payments and chargebacks (when a customer complains about a transaction and the bank reverses the payment).

2. Length of contract

You need to be aware of the length of contract that you will be committing to, especially if your requirements are likely to change over time. Some providers will offer monthly rolling contracts while others will want you to commit to a minimum term.

3. Ease of use

Before adding a new payment service to your website you’ll want to look at how easy it is for your customers to use. You’ll want to consider how many steps it will take for the customer to complete a transaction both on a PC and mobile.

4. Recurring payments

If you’re planning to take payment for online subscriptions then you’ll need to make sure that your chosen payment provider has the ability to set up recurring payments.

5. Multiple payment options

It’s usually a good idea to offer customers more than one payment option on your website. Having multiple payment option gives your customers more choice and increases that changes that there will be a payment option that they’re comfortable with. Apple Pay, Google Pay and PayPal are popular alternatives to traditional card payments as they give the customer convenience of making payment without entering card details.

6. Reliability and support

Your payment system will be the lifeblood of your eCommerce website. Take a look at feedback from other users of the payment provider to see how often they experience technical issues, what their customer support is like and if there are any reports of users accounts being blocked unexpectedly.

Recommended Payment Providers

Below is a list of reputable payment provides that you might want to consider looking at when choosing a new payment provider for your website:

Stripe Payments – Best for startups

Stripe is one of the most innovative payment processing providers on the planet – and when it comes to power, value, and versatility, its payment gateway doesn’t disappoint.

Stripe Fees
Transaction feeSetup feeMonthly feeFree transactions?
1.4-2.9% (+ 20p)£0£0X
ProsCons
  • One of the cheapest payment gateways on the market
  • Customised payment forms look great on your website
  • Customer service is lacking when compared to other providers

WorldPay – Best all-rounder

Worldpay is a colossus in the card payment industry. Trusted by more than 300,000 UK businesses, its payment gateway is one of the most dependable on the market.

WorldPay Fees
Transaction feeSetup feeMonthly feeFree transactions?
0.75-2.75%£80 (integration)£19.95X
ProsCons
  • Simple, flexible pricing plans to suit businesses of all sizes
  • Online hub offers great eCommerce advice for UK SMEs
  • Not the cheapest when compared to other providers

PayPal

As a well established household name, PayPal gives customers the safety of a brand they already know and trust.

PayPal Fees
Transaction feeSetup feeMonthly feeFree transactions?
POAPOAPOAPOA
ProsCons
  • Smooth interface makes your customers’ buying journey a effortless one
  • Stores your customers’ card details for quicker purchases
  • PayPal transaction fees are expensive – especially for smaller businesses

Amazon Pay

Amazon Pay helps to cut out the administrative hassle for everyone involved in the transaction by reusing payment details stored in the Amazon accounts you already use.

Amazon Pay Fees
Transaction feeSetup feeMonthly feeFree transactions?
1.4-3.4% (+20p)£0£0X
ProsCons
  • Range of API integration options
  • Familiar, easy to use login and interface
  • High transaction fees means it’s not so suitable for startups or small businesses with fewer sales

Klarna – Best for buy now, pay later

Klarna is one of Europe’s biggest banks, providing payment solutions for 60 million consumers, through 70,000 merchants in 18 countries.

Klarna Fees
Transaction feeSetup feeMonthly feeFree transactions?
1.4-3.4% (+20p)£0£0X
ProsCons
  • Customers can pay after delivery
  • Customers don’t need to pay if they are returning the goods ordered
  • Easy checkout experience
  • Customers can pay by instalments
  • Klarna pays businesses at checkout
  • Customers experience problems with their purchase being refused without any valid reason
  • Delay in responding to emails from customers
  • Problems with refunds to customers

GoCardless

GoCardless offers a simple way to accept direct debit payments. The company processes £2.9 billion worth of transactions each year.

GoCardless Fees
Transaction feeSetup feeMonthly feeFree transactions?
1% capped at £2£80 (integration)£0 standard plan
£50/month plus plan
£200/month pro plan
X
ProsCons
  • Excellent technical team
  • Lack of bureaucracy
  • Positive transformation of fee collection – less debtors
  • Great value
  • Good customer service
  • Customer service has deteriorated over the last 7 years
  • No new services being introduced
  • Serious glitches with SAGE integration
  • Delays in account setup
  • Communication between departments is sadly lacking

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