How to Choose a Payment Gateway – 6 Questions to Ask
Choosing the right payment gateway is like choosing your life partner: one should have some special characteristics that you find important but in the end it all comes down to the fact how special they make you feel and what your inner voice tells you about your choice! Like in every relationship it takes a while to get things done right.
“Falling in love” and choosing the right payment provider for your online business can substantially influence your revenues, conversions and user satisfaction. It can basically change your life – your business life.
You can either fall in one of two categories: either you do it for the first time in your life, meaning you are a startup, or you already have some experience with online payments but the experience so far has not been good at all. Hence, you decided to shop around.
Both situations give you good reason to start. Being unhappy is a step towards looking for a new payment processor. Flaws of your current provider such as poor customer service can also be enough reason to start your quest for a change. Having a list of things you do not want based on your previous experience can significantly narrow your search down and help eliminate from your list of suppliers that offer similar sloppy service, or they lack features you look for.
There are plenty of fish in the sea
As there are many card processing companies offering different services you will not have a problem to find one just for you.
Define your business needs. Define the markets you wish to attract with your product. Consider your incorporation place because this will either allow you to work with some providers or it may not be possible due to certain card association rules and banking laws. Have some thoughts about your business model, product or service because this will also define the type of the processor you look for and functionalities it has to deliver to support exactly what you wish to set up. Do you wish to have more control over your payments or maybe you want someone else to deal with that for you?
Like in every business there are some traps to avoid and things to look particularly at to make sure your quest for finding the right payment partner will pay off.
Here is a small list of things you DO NOT want:
1. Inflexibility in the set up
2. Lack of transparency
3. Long and complicated technical integration process
4. Long merchant account application process
5. Sloppy support
6. Hidden fees
Conducting due diligence process on your own will definitely bring you benefits. Your ultimate goal should be finding a hassle-free gateway that supports your business model, your product or service by allowing you to create any payment scenario you want in simplest, fast and friendly way.
What questions should you ask a prospective payment provider?
These days everyone seems to talk about it but only few understand it well and actually deliver it. Can your payment gateway adapt to specific needs of your business? Can they adapt to your programming language? Do they process worldwide in all the currencies you need for your business? The platform should allow you to create any business model and any payment scenario you can come up with. Also, the integration possibilities should be limitless.
Prior to initiating the cooperation, confirm the duration of the application process. Compliance can take some time, so ask your new gateway for the estimated time it would take to obtain your new merchant account and start processing transactions.
It is all about a robust API that is a beating heart of every payment gateway. Great APIs of good providers are usually displayed right on their website, because it is something they are very proud of.
2. Processing options
Where the magic happens.
The way a payment form looks like may decide not only upon your conversion rate but also it will create lower or higher trust from your buyers.
Check if the provider offers you an embedded custom form to keep your users always on your website (no-redirection to other parties’ website will result in significantly higher conversion).
Simple but beautiful checkout option will not only dramatically influence the user experience but also simplify the entire user flow and make the payments fast and easy (simple and perfect solution for one-time and recurring payments).
Innovative payment provider will offer you a wide range of additional features designed to increase your sales and profits (multi language checkout, one clicks upsells, cross sales or “Remember me” function that allows returning clients to conduct payments with a single click).
3. Technical integration
Keep your developer happy or do it yourself.
Hassle-free is the best word that describes how the integration should be done. That can be understood as: fast, simple and easy to execute not only by a developer but also by a regular business owner. Few clicks, few adjustments and you are ready to go in few minutes. As simple as it gets.
Ask about the options and technical documentation. Long and difficult integration processes can take weeks and will cost you time and money. The best payment providers should offer a set of APIs allowing you to integrate with just a few lines of code in a matter of hours.
What your eyes don’t see, your heart won’t feel.
Not true in payment processing. You HAVE TO know in advance the entire fee structure. Moreover, you also have to understand it. Having said that, fees have to be simple and clear.
There should be no room for surprises and lack of trust when your money is involved.
Sometimes you get excited seeing very competitive fees on paper and you may think this is how much you will end up paying. Unfortunately, some payment gateways charge additional fees for certain services or the displayed fees are given only if certain conditions are met (local traffic, minimum volume required or refer to just one currency).
Make sure there are no hidden fees and the pricing policy is transparent. Ask to have everything confirmed before you make an effort and integrate the entire system. Ask, ask, and ask again. Ask the provider to enlist all the costs that you might encounter whilst using their service to avoid unpleasant surprises of paying double the actual price. That could mean that your current product-pricing model may suddenly become not profitable enough.
- set up fee,
- monthly fee,
- registration fee,
- processing fee,
- transaction fee (successful and declined),
- refund fee,
- chargeback fee,
- and any other fees you may be subjected to, based on some scenarios.
Also, make sure you get paid fast. Your cash flow is important, so there is no reason for not getting paid weekly with just few days delay where money travels from one account to the other. Check the payout schedule and make sure it sits nicely inline with yours, in regard to paying your suppliers. Last thing you want is to have a cash flow gap and be subjected to complaints from your business partners or suppliers.
Digital security is not only a hot topic today but an absolute must in case of online payments. Ask your payments provider about the data encryption, VeriSign SSL certificates and CVV2 verification and any additional encryption algorithms ensuring data protection of your customers.
It is not only about the safety of your merchant account but also about the safety of your clients and their financial information.
Token technology can provide additional level of security. With the help of tokens, credit cards digits are being replaced with a string of meaningless numbers making it impossible to use by any fraudster trying to fish for them after hacking your system. This technology can save you a lot of trouble and protect your loyal clients from card abuse.
Make sure you check the gateway provider in terms of fraud protection. They should offer anti-fraud system and active chargeback management.
Verify your payment provider if they meet the strictest security requirements which are known as PCI Level 1. That confirms that not only the technology of the platform is secure, but also the entire organization behind it with people are fully aware of the risk factors regarding payments processing and are ready to act fast due to proper procedures in place to prevent misconduct from occurring.
6. Customer support
… because everyone needs an “angel protector.”
Do you recall the annoying feeling that you went to your Internet banking and one time you wanted just to talk to someone and instead you had either an automatic response system or FAQ with a loop and you end up being upset, lost and wasted time? Yeah. You don’t want that.
Automatization is great when it works well, is simple and user-friendly.
Payment processing is critical in every e-commerce business so the reaction has to be fast and all the issues resolved immediately. Make sure what type of service you might need – sometimes it’s not necessary to have 24/7 support as usually the more service options you have the more expensive the gateway.
What you definitely want is to know where to ask for help or support. You should not be waiting 24 or 48 hours to get a response. Good payment gateways will assign you an account manager that will be there for you not only when the sun shines but also during rainy days.
And this is exactly the difference between a payment provider and a payment PARTNER.
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