A payment gateway is the internal processes that run after the person decides to pay with their card at your store. The payment is processed within a couple of seconds, but right there within those 2 seconds lives the diverse universe of payment processing with lots of players, services, solutions, competitors and alliances.
Merchants usually use the word “payment gateway” to denote “an internal system that’s in charge of payment processing”. Actually, there are two types of systems here – payment gateways and payment processors. The payment gateways are used to channel the data between various platforms, while the payment processors actually process the data.
It’s important to understand that any payment-related data is highly sensitive. If a hacker steals the info, they would be able to perform fraudulent operations.
What options do you have when choosing a payment gateway?
Generally, as a store owner, you have 4 options:
1. Hosted payment gateway.
This will mean that users will need to click on the button and then go to another site where they’ll complete the purchase. This is the easiest method. The main downside is that users will need to leave your site which might increase the abandonment rate.
2. Integrated gateway via the out-of-box method.
For instance, you use Woocommerce. You go and look for a payment gateway which you can integrate right within your cart. Thus, the users won’t need to leave your site! The downside is that you won’t be able to adjust all the fields and parameters.
3. Integrated gateway via the fully customized method.
You hire a professional developer who codes in whatever you want to see in your cart! In this way, you can split-test various cart settings and identify those that enable the best customer journey. This will surely reduce your cart abandonment!
4. Own payment gateway.
It will cost you millions of dollars 🙂 Not even the largest stores can justify the investment.
How do you choose the payment gateway that suits your needs most?
The best way is to not to.
Just go online and google “best payment gateways”.
The list you get either way is what you need. You just need a simple payment gateway to start you off, or to enable the continued growth at the early stages of your journey.
Reach out to some of those big payment gateways and try to compare their offerings. Try to understand what their USP is and what specific market segment they are focused on.
That would be a super-useful exercise and you’ll learn a lot of useful information.
But there’s a more optimal way to act here. Choose PayPal.
PayPal as the best payment gateway out there for new/rising stars
Each and every online store is unique in terms of products, approaches to customer service and the team. But there’s something hidden that unites all of them. They are online stores. Hidden, right?
That’s why whenever you launch on your journey into the tumultuous and hi-po waters of ecommerce, you want to start rowing as opposed to constantly thinking about how you’re gonna do this or that. Time to row.
And the best tech for a new business is the tech that enables it to row.
PayPal does that – it enables you to row.
How does it compare against potential competitors? It doesn’t. You don’t need to compare it against the competitors.
Because it’s not about the competitors and their comparative benefits for your business.
It’s always about your business’ needs. In order to clearly identify your needs, you need to start growing the target audience and sales. Then, your needs will become clear. And you’ll be able to scout the market for the payment gateways that deliver on your unique needs.
Right after you’ve launched or during the first months/years, it doesn’t matter what system you use.
And since it doesn’t matter, PayPal is the best choice for you. Learn more about PayPal’s offer. And, YOU CAN ALWAYS CHANGE THE PAYMENT GATEWAY AS YOUR BUSINESS GROWS WITHOUT MUCH PROBLEM.
What are the benefits that PayPal offers? Actually.
1. Global recognition
Everybody knows what PayPal is.
Whether it’s a hosted or integrated version, PayPal always takes care of the actual processing inside. This means that you don’t need to. If you touch any sensitive data, you need to comply with super-stringent requirements called PCI. And it’s very hard to ensure compliance ith them. Thus, the best option is let PayPal do the work.
3. Decent adjustability
If you go for an integrated version, you’ll be able to implement a sufficient number of adjustments in your efforts to cut down on the abandonment rate. It’s not the completely customized payment flow, but it’s completely sufficient for your rising-star store.
4. Reliability in the customers’ eyes
This is the product of the 3 benefits above. But it’s important to clearly identify this advantage. People trust PayPal. There’s a certain feeling that it’s too big and that it’s monopolizing the market and that it might be banning some accounts. But, you know what? No sane customer thinks about these things. It’s us, industry folks, who register them. Customers only see the reliability of PayPal, and then they think as to “how this impacts my decision to click the Pay button”.
Should I migrate from another payment processor to Paypal?
We don’t know that answer to this question. It’s probable that since you are completely OK with this system, you should stick with it.
At the same time, a transition to another payment platform won’t take much effort. And it’s not expected to have a major impact on the customer journey and the sales.
Just make sure that your store offers the payment options, preferred at the local market where you operate.
We are a team of ecommerce consultants. Ping us on FB with any queries you have on your mind. We’ll either channel you to a relevant article or help you figure out the best course of action in your case. We’ll also be happy to offer paid consultations and services for deeper engagements.