Ever since the non-cash payment methods came into existence, peoples’ life has become too expedient and effortless. It’s easier for them to avail products and services by charging their credit or debit cards and paying for them later. This system, other than providing convenient payment processing solution to both customers and businesses, also ensures secure flow of cash.
Providing an online credit card processing service has become a necessity in order to grasp more market share than your competitors and sustain in the market for a long period of time. This payment procedure, however, is not quite familiar to many ecommerce businesses. While many businesses are aware of their offerings, they tend to have less information regarding the intricate procedure of providing credit card payment solutions to their customers.
Nowadays, ecommerce retailers give utmost priority to consumers and offer them endless options to pay for the goods and services they wish to avail. The payment choices can vary from the type of business and their own personal preferences.
Here are a few terms that are required to be fully understood before proceeding towards understanding the best method to join the credit card processing regime.
A merchant account allows the ability to businesses of providing best ecommerce payment solutions by accepting payment from debit or credit cards. They hold the money until they are transferred to the business’s bank account. Creating a merchant account involves an in-person session at a merchant acquiring bank for the settlement of credit or debit card transactions, where information regarding the business is vetted by any employee at the acquiring bank. Merchant account allows the ability to payment processors to directly involve themselves and use merchant account, but this process isn’t necessary.
Another common method of providing the ability of online credit card processing to the customers is a payment gateway. A payment gateway helps businesses to connect with merchant account and allows the successful transaction of money – done via credit and debit cards by the customers in exchange of the products and services availed by them. Payment gateways validate credit card payments thereby providing support to point of sale system. The process of paying through credit cards involves the participation from several other entities other than businesses and customers, possible including the acquiring bank that creates a merchant account and a credit card issuing bank which provides credit card processing solution to customers. Other than the mandatory fee of establishing payment gateways method, no other substantial fee is involved in this process which makes it preferable by many ecommerce businesses dealing online.
All in one solution enables businesses to combine a merchant account and a payment gateway under one platform. The best example of this is PayPal business account. Payment via PayPal Cash Card online is considered one of the best electronic alternatives of typical cash payments that usually involved checks and money orders. Apart from authorizing the ability to businesses to all payment types in low cost, it also allows businesses to accept payment from customers without having a PayPal accounts. This convenient feature encourages businesses to go for this method thereby providing best ecommerce payment processing solutions to its customers. The all in one solution often redirects customers to a separate payment processing page in order to complete a purchase transaction.
Simplified credit card processor works in a much similar manner as an all in one solution. It also collaborates with an ecommerce store and allows a convenient and seamless experience to customers visiting ecommerce websites online to avail products and services.
These options are the most widely used methods in the realm of online credit card processing services to customers. The methods can be adopted by ecommerce businesses based on quite factors and can substantially vary from businesses to businesses from ease of setup being the most important and cost and monthly fees being the least important or vice versa.
The merchant account and payment gateway bring maximum convenience to new ecommerce retailers – providing ease to especially those new to the field. Despite the fees for both the merchant account and payment gateway – which is often waived in some scenarios, it makes it a top choice by many ecommerce retailers because of secure flow of financial data and customization. However, the extensive process of setting up a new account and gateway and too much paper work involved may not make it the best choice for some ecommerce retailers.
The all in one solution is the most preferred choice of processing credit card payments as it is convenient for both retailer and customers. PayPal; the largest payment system provides the best payment processing solutions processes all online transactions. The best feature about this method is they have no initial costs except for the additional costs for additional components that are specifically added by users. Moreover, their setup procedure is quite easy. Probably the only downside which is merely considered a disadvantage is that customers are redirected to a separate page for transactions which most consumers find a jarring thing to do.
Last method to accept credit card payments is a simplified credit card processor. The best parts about credit card processors such as Stripe are not only their quick and easy setup but their instant acceptance of credit card payments – ensuring best ecommerce payment solutions to customers online. Furthermore, their rates are similar to all in one solution. The only disadvantage about this method is it requires more than usual time to process and doesn’t function in real time. It processes over email or troubleshooting manuals, instead.
In nutshell, Ecommerce retailers should do proper analysis on the pros and cons of each method before adopting a specific method of credit card payment for their ecommerce website. They must incorporate a payment method according to the type of business and market environment they operate in to provide best ecommerce payment solutions to customers online.