Factors to Consider When Choosing A Payment Gateway For eCommerce Store
A Payment Gateway is that part of your eCommerce that connects your store to a credit card company. In a nutshell, people can process their credit card, and you get paid. It is quite modest if we say that this is an integral part of your eCommerce website. Some of the popular examples of gateway payment are PayPal, Google Pay, Stripe, Amazon Payments etc.
In this blog, we are going to explain all the factors which you need to take into consideration while choosing a payment gateway for your eCommerce site.
Security & Fraud Policies: Read all the policies related to the gateway carefully. Many don’t allow a high-risk business like ‘Adult Material, Casino games’, etc. Another important issue you should read about is how they handle chargebacks. PayPal freeze your account and hold your funds; hence it is a big no. Many follow this rule; hence you should read their security and fraud policies carefully as they are out to protect themselves and not the users.
Time to settle funds into your bank account: Each gateway takes a few hours to settles your funds, i.e. the time they take to send the transaction detail to your bank. Then after 24 to 48 hours, the bank settles the fund, and the money shows up in your account. This is important for an eCommerce site which is working with value products or is bootstrapped. Stripe takes up to 48 hours while others take a week so consider this.
Discount Rate: Discount Rate is the percentage that a gateway charges to process the transaction. For example, PayPal charges 2.9% Discount on all Credit Card Transaction plus a $0.30 per transaction fee. This is amount is charged while the customer uses the gateway. Each gateway has a different Discount Rate, and you can negotiate with them if you show large transactions.
The cost to set up the payment gateway: Many multi-vendor eCommerce solutions come with predefined payment options like PayPal Standard and COD. They charge you extra if you want to add more options. Hence you need to choose a payment gateway which can be easily integrated with your Ecommerce site and doesn’t cost much.
Note: You should also enable CVV & Postal/Zip code verification.
An Interface of your payment gateway: This is very important both for customers and especially you. How easily can you view all the transactions including pending payments, refunds and chargeback? Some Gateway like Stripe offers great analytics and easy to display customer data. Such hassle-free make your work fast and straightforward.
Supported API: An application program interface (API) allows other systems which you have authorized to grab your transaction data anytime and seamlessly. This comes in handy if you are operating 3rd party dashboard systems like Zapier or Barometric.
Target your audience: Do their support the countries you intend to sell your product? Do they accept credit cards from their countries? E.g. ‘Rupay’ is an Indian credit card company, Major Payment Companies like Stripe and PayPal doesn’t support it. Hence customer would repel due to this little reason.