Payment gateways are powerful tools that forms the backbone of e-commerce, enabling businesses to accept and process online payments. But what is a payment gateway? Simply put, it’s a technology that transfers payment data from the customer to the merchant.
How Payment Gateways Work
Payment gateways are like middle man that works between the merchant and the buyer. It works by encrypting sensitive data like credit card numbers most often these gateways offer API to merchants and gateways read these parameters like purchases. Once a customer makes a purchase, the gateway sends this data to the merchant’s bank, which then sends it to the customer’s bank. If the transaction is approved, the payment goes through.
Choosing the right payment gateway can feel overwhelming. There’s no one-size-fits-all solution. It’s essential to consider factors like pricing, payment methods, and security. What you need to do is list down the features you want and choose among these gateways that best describe your needs.
Fees
Pricing varies widely among payment gateways. Some charge a flat fee per transaction, while others offer a tiered or subscription model. Be sure to read the fine print and understand all the costs involved.
Payment Gateways Supported Payment Methods
Payment gateways also differ in terms of the payment methods they accept. Some handle credit and debit cards, while others also process digital wallets and cryptocurrencies. Choose a gateway that supports the payment methods your customers prefer.
Here are some list of the payment methods commonly supported by payment gateways.
- Credit Cards: This is the most common method. Most gateways support a variety of cards such as Visa, MasterCard, American Express, and Discover.
- Debit Cards: Like credit cards, debit cards are widely accepted by most payment gateways.
- Bank Transfers/ACH Payments: Some payment gateways allow direct transfers from a customer’s bank account.
- Digital Wallets: Many payment gateways support digital wallets like Apple Pay, Google Pay, and Samsung Pay.
- PayPal: Given its wide usage, many payment gateways support PayPal transactions.
- Cryptocurrencies: Some gateways support cryptocurrency payments, like Bitcoin, though this is less common.
- Buy Now, Pay Later Services: Some gateways may support services like AfterPay or Klarna, which allow customers to purchase items and pay in installments.
- Prepaid Cards: Some gateways accept prepaid debit cards as a form of payment.
- Direct Deposit: Certain gateways may also support direct deposit payments.
- Mobile Payments: Mobile payment options such as Venmo or Zelle may also be supported.
Security should be a top priority when selecting a payment gateway. Look for features like encryption and tokenization, which protect sensitive data of your users and yours as well. Also, ensure the gateway is compliant with Payment Card Industry Data Security Standards (PCI DSS).
PayPal
A global giant in the payment gateway market, PayPal offers a seamless user experience. It’s ideal for businesses seeking broad international acceptance.
| Rating | Payment Method | Pros | Cons |
|
4/5 |
Credit/Debit Cards, PayPal Balance, PayPal Credit, Bank Accounts | Broad international acceptance, trusted by consumers, easy to use. | Fees can be high, especially for international transactions. Some customers report poor customer service. |
Stripe
Loved by developers for its customization options, Stripe supports over 135 currencies. It’s perfect for businesses catering to a global audience.
| Rating | Payment Method | Pros | Cons |
|
4.5/5 |
Credit/Debit Cards, ACH transfers, Apple Pay, Google Pay | Highly customizable, supports a large number of currencies, excellent for developers. | Requires some technical knowledge to fully utilize, may not be ideal for less tech-savvy users. |
Square
More than a payment gateway, Square offers a suite of business tools. It’s an excellent choice for small businesses looking for an all-in-one solution.
| Rating | Payment Method | Pros | Cons |
|
4/5 |
Credit/Debit Cards, Square Gift Cards, Apple Pay, Google Pay | Provides a suite of business tools, flat-rate pricing is simple and predictable. | Not the cheapest option for larger businesses, some reports of account stability issues. |
Braintree
This PayPal-owned service is designed for easy, secure transactions. It accepts a variety of payment methods, from credit cards to cryptocurrencies.
| Rating | Payment Method | Pros | Cons |
|
3.5/5 |
Credit/Debit Cards, PayPal, Venmo, Apple Pay, Google Pay, Cryptocurrencies | Accepts a wide variety of payment methods, including cryptocurrencies, offers excellent customization. | The fee structure can be complex, and it may not be the cheapest option for small businesses. |
Authorize.Net
As a long-standing player, Authorize.Net offers exceptional customer service. Its robust fraud protection makes it a secure choice for businesses.
| Rating | Payment Method | Pros | Cons |
|
4/5 |
Credit/Debit Cards, ACH transfers, Apple Pay, PayPal | Long-standing and trusted, excellent fraud protection, great customer service. | Charges a monthly fee in addition to transaction fees, setup can be complex. |
Amazon Pay
By leveraging existing Amazon accounts, this gateway offers a familiar experience. It’s a good fit for businesses targeting Amazon’s massive user base.
| Rating | Payment Method | Pros | Cons |
|
4/5 |
Amazon account balance, Credit/Debit Cards linked to Amazon account | Seamless integration for Amazon customers, trusted by consumers. | Primarily benefits businesses targeting Amazon's customer base, transaction fees can be high. |
2Checkout
This versatile gateway supports multiple payment methods and currencies. It’s an excellent option for international businesses.
| Rating | Payment Method | Pros | Cons |
|
4.5/5 |
Credit/Debit Cards, PayPal | Supports multiple payment methods and currencies, good for international businesses. | Transaction fees can be high, some reports of occasional payment delays. |
Adyen
Adyen allows businesses to manage all transactions in one place. It’s a great choice for businesses seeking a streamlined solution.
| Rating | Payment Method | Pros | Cons |
|
3.5/5 |
Credit/Debit Cards, Apple Pay, Google Pay, PayPal, Local Payment Methods | All-in-one payment system, supports a wide range of payment options. | Requires a minimum amount of transactions, not ideal for very small businesses. |
Shopify Payments
If you’re using Shopify, this gateway offers seamless integration. It’s an excellent choice for Shopify-based e-commerce stores.
| Rating | Payment Method | Pros | Cons |
|
4.5/5 |
Credit/Debit Cards, Apple Pay, Google Pay | Seamless integration with Shopify, easy to use. | Only available to Shopify users, account stability issues have been reported. |
Apple Pay
Utilizes iOS and MacOS users. This mobile payment systems cater to tech-savvy customers. They’re ideal for businesses targeting younger demographics.
| Rating | Payment Method | Pros | Cons |
|
4/5 |
Credit/Debit Cards linked to Apple Wallet | Fast and convenient for users, secure. | Not all customers use these services, requires a smartphone with these payment methods set up. |
Google Pay
Another mobile payment solution that utilizes android users. Highly convenient for mobile users that uses Android phones.
| Rating | Payment Method | Pros | Cons |
|
4/5 |
Credit/Debit Cards linked to Google account | Fast and convenient for users, secure. | Not all customers use these services, requires a smartphone with these payment methods set up. |
Worldpay
A comprehensive global provider, Worldpay processes payments in over 120 currencies. It’s perfect for businesses with a global customer base.
| Rating | Payment Method | Pros | Cons |
|
3.5/5 |
Credit/Debit Cards, PayPal, Bank Transfers | Comprehensive global payment provider, supports a large number of currencies. | Some users report poor customer service, the fee structure can be complex. |
Skrill
Skrill supports over 40 currencies, making it ideal for international transactions.
| Rating | Payment Method | Pros | Cons |
|
3/5 |
Skrill Wallet, Credit/Debit Cards, ACH Transfers, Cryptocurrencies | Supports a wide range of currencies, good for international transactions. | Not as widely recognized or trusted as some other options, fees can be high. |
Stax
With its transparent pricing model, Stax offers a range of payment solutions. It’s a great fit for businesses seeking clarity in fees.
| Rating | Payment Method | Pros | Cons |
|
4/5 |
Credit/Debit Cards, ACH transfers | Transparent pricing model, provides a range of payment solutions. | Monthly subscription might not be cost-effective for low-volume businesses. |
Helcim
Known for its transparent pricing and excellent customer service, Helcim is an excellent choice for small businesses.
| Rating | Payment Method | Pros | Cons |
|
3.5/5 |
Credit/Debit Cards, ACH transfers | Transparent pricing, excellent customer service. | Not the cheapest option for businesses with low sales volumes. |
Payment Depot
This gateway offers a membership-based pricing model, perfect for high-sales-volume businesses.
| Rating | Payment Method | Pros | Cons |
|
3/5 |
Credit/Debit Cards | Membership-based pricing model can be cost-effective for high-volume businesses. | Membership fees may not be cost-effective for smaller businesses. |
Merchant One
Merchant One provides a variety of merchant services, making it a one-stop-shop for businesses seeking comprehensive solutions.
| Rating | Payment Method | Pros | Cons |
|
3.5/5 |
Credit/Debit Cards, ACH transfers | Provides a variety of merchant services. | Some reports of hidden fees, customer service could be better. |
Choosing the Perfect Gateway for your need
Before deciding, consider whether the gateway supports on-site or off-site transactions. On-site transactions occur entirely on your website, providing a seamless customer experience. Off-site transactions redirect customers to the payment gateway’s site, then back to your site once the transaction is complete.
Payment gateways also differ in terms of integrations and customizations. Some gateways seamlessly integrate with various e-commerce platforms, while others offer APIs for custom integrations. The right choice depends on your specific needs and technical capabilities.
In conclusion, the best payment gateway for your business depends on your unique needs. Consider the gateway’s pricing structure, accepted payment methods, security measures, and compatibility with your e-commerce platform.
Remember, the goal is to provide a seamless, secure shopping experience for your customers. By doing so, you’ll not only increase conversions but also build trust, which is crucial in the online world. With the right payment gateway, you can achieve this and more.
So take your time, do your research, and choose the payment gateway that fits your business needs best. Happy selling!