Wednesday, May 12, 2021

The Worlds of Payment Solution for E-Commerce

There has been a steady increase in online shopping in recent years. Retailers have started selling more products online to grow their
business. However, to have the best service, it is important to make the website capable of handling online transactions. Connecting the site
to a certain payment processing provider (or providers) often requires advanced technical knowledge.

Luckily, third-party payment service providers give access to this capability without much complexity. They deliver the solution to process transactions and create a better shopping experience for both the retailer and the customer. There is a large number of payment solutions available, and all of them have different features, capabilities, and rates.

Online payment solution terms

When comparing payment solutions, there are several things you should know about:

  • Merchant Account is an online bank account that allows businesses to accept online payments by payment cards. It will temporarily hold the payment, until the funds are moved to the actual bank account.
  • Payment Gateway is an e-commerce application service provider that will authorize credit card payments and process transaction for retailers.
  • Payment Service Provider (PSP) will offer service to online stores for accepting electronic payments without a merchant account.

Key attributes for online payment solution

To narrow down the search for a “perfect” payment solution, look for key attributes such as:

  • Fees which can vary depending on the third-party provider. All transactions and services will be charged either on usage, on monthly or annual basis. Different pricing structures can impact profitability of the online store in different ways.
  • Transaction processing is one of the most important aspects of online payment. The fewer days it takes to process funds, the more effective your online store will be.
  • Integration with the website is equally crucial, because some online payment solutions may bring unnecessary complexity.
  • Customers are an important component of any online shop. Considering their preferences is a must.
  • PCI compliance will ensure safe transactions for customers and retailers.

Best online payment solutions for e-commerce

PayPal
With over 450,000 websites and more than 220 million users, PayPal is the most widely used payment platform in the world. Its current market share is 58.85%, which makes it an indisputable giant in the world of online payment solutions. It provides payment processing services for e-commerce vendors, auction sites, and numerous other commercial entities.
PayPal comes with 250+ integrations, plenty of customization options, online invoicing, and facilitates credit card payments over the phone. Pricing is competitive and comes at 2.9% per transaction with no additional monthly fees. It has a three-tiered plan: PayPal Express Checkout, PayPal Payments Standard and PayPal Payments Pro. The biggest complaint about this platform is that the company may limit the account or freeze funds for no reason.

Stripe
The company claims it handles billions of dollars’ worth of transactions annually, which makes them one of the largest platforms in the world. The biggest difference between this service and PayPal, or other payment solutions, is that users are provided with a range of flexible tools to customize their own payment process. It doesn’t allow to go outside of the box, so it is designed for larger businesses in mind. There is a plethora of APIs that allow the creation of own subscription service, on-demand marketplaces, or crowdfunding platforms. With all this, Stripe demands a lot more technical knowledge than most providers.
The platform charges 2.9% per transaction and currently covers more than 150,000 websites. Stripe holds 16.38% of market shares and supports more than hundred currencies. It comes with features such as mobile payments, one-click checkout, and subscription billing. Fees for European cards are 1.4% plus an additional 20p per transaction. For non-European cards, the standard is 2.9% plus $0.30 per charge.

Amazon Pay
Amazon Pay was launched in 2007 as a direct competition to PayPal and Google Pay. It allows people to make an online purchase via the Amazon account and comes with two options: Checkout by Amazon and Amazon Simple Pay. The biggest advantage of Checkout by Amazon is that users don’t have to leave the retailer’s website to complete the process. The transaction can be completed when users log in to their Amazon account.
Amazon Pay aims to be a big provider and is currently covering more than 35,000 websites worldwide. Charging 2.9% per transaction plus an additional $0.30 per charge, the pricing is moderate and similar to other platforms. It comes with 30+ integrations. The downside to this platform is the need to have an Amazon account.

Authorize.net
Founded in 1996, Authorize.net is one of the oldest and most reputable online payment solutions. The main aim of this platform is to streamline the payment process and is developed for companies of all shapes and sizes. The company will provide the necessary tools to sell items and complete online transactions. It supports all major credit cards and has almost all currencies available.
Authorize.net comes with 50+ integrations and charges 2.9% per transaction. Additionally, they charge a monthly gateway fee of $25, a transaction fee of $0.10 and a daily batch fee of $0.10. It is a pricey provider designed with maximum security measures for larger business owners. A very good feature is the ability to set up multiple accounts with permissions to control access for each user.

Adyen
Adyen is mostly used by big companies like Uber, Spotify, Microsoft, and eBay to handle business and customer transactions. The software allows payments to be made from a single platform, giving the necessary tools to manage risk and track results. The platform accepts more than 250 payment methods and covers over 150 global currencies.
A special feature allows transaction data analisis to have a better insight into customer’s behavior. You can identify the buyer’s pattern and tweak the products and services accordingly. Risk-management tools will allow identifying and fighting against fraud. However, the company has a complex pricing structure and needs a merchant bank account to take advantage of interchange pricing.

Google Pay
Google Pay is the direct result of the merger of Google Wallet and old Android Pay. The platform is not the most popular payment solution, but it offers much-needed reliability, security and branding. It enables users to make online transactions using phones, tablets, and even watches. Customers can use the specifically encrypted number to pay in stores.
After the merger, the company provided all users with the new API. This allows merchants to add payment service to websites and applications. The most recent addition is the unique support for boarding passes and event tickets. Google Pay only charges a 2.9% fee on a credit card transaction, while everything else is free of charge.

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