Choosing an Online Payment Processor

[Ozzy]

Getting started in E-Commerce - Choosing an Online Payment Processor

Despite the claims that the UK is a great place to set up shop, finding the right service for taking credit card payments online can be a stressful journey! In the second of our Getting Started with E-Commerce series, we guide you through some of the minefield that is online payment processing.

So, what do you need to take debit and credit cards online?

1) A business bank account
2) A merchant account to process credit card payments
3) An online payment processor to process card transactions automatically online

These can all be with separate institutions, or at your business bank.

Business Bank Account:

If you don't already have a business bank account, get this sorted first. You can do little without it! Have a look at MoneySupermarket.com for a comparison of accounts.

Merchant Accounts:

A Merchant Account is an addition to your business bank account that allows you to accept credit and debit card payments. If you already have a merchant account from your bank, check with them before processing internet transactions as additional permission is usually required for this, even if you already do process Cardholder Not Present transactions. If your bank is unwilling to set up a merchant account for you, have a look at the sites mentioned below for information on a payment processor combined with a merchant account. Be warned however, that it is usually more expensive to go down this route.


Choosing a Payment Processor:

An online payment processor automatically processes debit and credit card orders from your site, so you don't need to handle the card details at all. There are a number of areas that you need to consider when choosing an online payment processor:

1) Setup fees: These can vary from free to £250+
2) Annual Fees: Again this may be free or can be as high as £160 (for example WorldDirect from Worldpay). These may be replaced with a monthly fee in some cases.
3) Merchant transaction fees: These are the fees your merchant bank charges for the transactions. Can be a fixed rate or a % of the transaction, or both.
4) Online processing fees: This is charged by the company processing the transactions online for you. Can be a fixed rate per transaction or a % of the transaction.
5) Bank fees: A generic fee (for want of a better description!) that may be charged for transferring funds to your bank account.

And check the lead time for receiving the cash in your bank!

1) Worldpay's WorldDirect service has a lead time of 4 weeks + (though this can be negotiated after a period of trading)
2) Others may be daily or weekly if you have a merchant account

If you have a merchant account, then one of the following online payment processors can be used:

http://www.protx.com
http://www.netbanx.com
http://www.secpay.com
http://www.worldpay.com
http://www.kwikpay.co.uk
http://www.securetrading.co.uk

If you don't have a merchant account, then try the following (they include merchant facilities):

http://www.worldpay.com (WorldDirect service)
http://www.kwikpay.co.uk (KwikOnline service)

There are also alternative options such as:

http://www.paypal.com
http://www.nochex.com
http://www.fastpay.co.uk


Step by step example using Worldpay's World Direct service:

1) You need a company bank account if you are trading as a company, so that's your first step. Best place to start is the bank where you have your personal account as you will have a history with them.

2) Then set up your website and the shopping basket you have chosen. If you don't have a merchant account, and don't think your bank will give you one, then you will probably go for World Direct from Worldpay so get a shopping cart that works with that.

3) Once the cart is set up, order your Worldpay account. You need a bank account and a website in order to apply for Worldpay.

4) Once Worldpay has approved your account, link it to the cart (this varies with each system so you will have to read the cart's manual for that)

5) Test it in test mode and then set it live. It's worthwhile testing it in live mode as well with a low-priced product and then refunding the money to your account.

Written by Managed Web - http://www.managedweb.com

 

[kyber]

I would like to add Pay Systems to the list. We have used them for over a year and have been very happy indeed. Yiu can use them with or w/o a merchant account.

Charges vary so shop around.

Stuart

 

[momtrepreneur]

Hi,

There are so may merchant services out there.

Nochex and Paypal - previously you have to be a member to purchase something and now thats change but does this mean that they don't need to be a member to purchase right there and then but once the order is processed you would still need to apply to be a member prior to the shop despatching your goods.

They're cheaper version of Worldpay but then they give out the small business operating from back bedroon kind of image or am I mistaken? Yes there is nothing wrong, I suppose it depend on how you want your business to perceived.

Paysystem is ok but they don't allow you to refund partially, just full or nothing at all. Check their charges for sending you the funds. If you're selling multiple items of different types, the shopping cart does not itemised these.

Regards

 

[SillyJokes]

We use WorldPay which seemed expensive at first but was convenient as we didn't need a merchant account.

Now we have negotiated much lower rates because they know our business is working.

Lower rates are there for the asking once you have been up and running for a while.

 

[Sibs]

Also, if you have a merchant account with your bank (for online payments) you probably won't need a separate payment processor.

You don't also need to use an off-the-shelf shopping cart as your web designer should be able to write a tailored one for you.

Thanks
Sarah

 

[springbrook99]

I think offering all 3 as an option to pay is the best offer.

Worldpay - probably give out the best image.

Nochex - I've actually found this to be an excellent system and if you are a small business looking for a processor without having to pay startup costs (like Worldpay) or cannot wait 4 weeks for your cash (like Worldpay) then this has to be a good alternative.

Paypal - Used to get a lot of bad press. Things are changing with Paypal. They are now owned by E-Bay, you no longer need a Paypal account to buy on a site using Paypal as a gateway. Many people regard Paypal as looking amateurish - however, you do not need to use the buttons provided by Paypal - design your own instead and simply have a Paypal button as an option at the final checkout.
There are 43 million account holders, so to ignore Paypal in case it "conveys the wrong image" might not be such a good idea.


My advice is to develop your own shopping cart (or use a third party shopping cart) and then offer the user the choice of which payment gateway to use. Strangely enough, we used to be a Worldpay affiliate partner but most people paying on our site used Paypal when given the choice out of the two (although I know other people who found the reverse to be the case).

 

[Deleted member 2816]

I've just discovered this thread, and am glad that I have!

So far, as I'm a small business for a pretty specialised market, I've used NatWest Fastpay, but I don't recommend them at all! I have continual problems with them & can only contact them online. The latest hassle was their refusal of a client's payment...because it was over £25! On their site, they tell you £50 is the payment limit but surprise! all of a sudden it seems the limit is now £25!! They didn't bother to change this info on the website, or let clients know :evil: They did give me an apology but what good is that?? I had to call the client, calm her down & persuade her to send me a cheque! The sign-up process is also long & complicated, so no wonder the majority of my customers prefer to send a cheque.

So now I'm looking into Nochex & Paypal, both of which seem to offer a good cheap service. From customers' feedback, it seems so many have Paypal accounts already - I suspect they are all E-bay fans! :wink: But Nochex is fairly well known too.

I had a look at the Pay Systems site, but they don't seem to want to tell us about their charges (or maybe I just couldn't find this - it could be me). At least Nochex & Paypal are quite clear on this.

Onwards & upwards....

 

[kyber]

I should have mentioned, we have stopped using Pay Systems. They were forced to switch to requiring full merchant accounts which we did not want.

As most of our (LAM Design) customers are after personal service they pay in cash or by cheque when they visit, we have decided to just use PayPal and Nochex from now on especially given how much simpler PayPay payments are for newcomers these days. We find features such as sending PayPal invoices very useful.

I don't think that the majority of people on the net have a big problem with PayPal these days but accept that for higher volume transactional sites, it is important to have a number of payment alternatives including a "proper" card processor.

Stuart

 

Most purchasers don't have a problem with Paypal but, as a vendor, I wouldn't go near them. They have the ability to freeze your account for the most trivial reasons with any money you still have in it. If it's your only payment system your business immediately grinds to a halt. If you've carelessly left a lot of money in the account, you could end up out of business. And Paypal definitely gives that "Mom & Pop in the garden shed" business image.

Ebay itself has a bad reputation for not dealing adequately with fraud - and there's plenty.

In contrast, WorldPay seems to have gotten it about right. Maybe that's because they can afford to. They cost more but it's probably worth it.

 

[StartUp]

Interesting discussion, I have always used worldpay, and still do, but since adding Paypal as an alternative, quite a few people have gone for this option rather than paying through Worldpay.
I suppose it's because they don't have to add their credit card details again if they already have an account?

I have also found that quite a number of what I would call "big players" on the internet only use Paypal.

Julia

 

[ARTzWeb.net]

It is worth mentioning that I stopped using WorldPay because of their inability to detect fraudulent transactions. They may seem hype, but the amount of money that was drawn from my merchant account with them due to chargebacks is something that all of you need to be aware of.

We registered for the 2co.com service and guess what, even though you don't even need a business bank account, they have detected most fraudulent transactions.

I ended up paying more than 200 quid to them in less than 4 months. This is not good at all.

So I decided to drop the hype worldpay account and get one at 2co. Much happier customer with them!

 

So I decided to drop the hype worldpay account and get one at 2co. Much happier customer with them!

Hmm, it doesn't exactly inspire me with confidence in them to find two typos in just one sentence:

Should you elect this payment method, you will be given further payment instructions. As soon as the funds are received, which is dependant on the sender and their contries banking systems, the order will be filled.

(This appears in a pop-up when the customer wants to get more info about credit transfer).

 

[WSC-Will]

For some additional advice on choosing an online payment processor I'd suggest looking at http://www.electronic-payments.co.uk, a website backed by the DTI and Scottish Enterprise.

 

[sportingmemories]

Thanks for the good advice, we (www.sport-signings.com) have gone with the PayPal Shopping Basket option to start with, with a view to move to Protx (www.protx.com) in the coming weeks. PayPal almost has it all, fantastic transaction fee`s, easy for the customer to use etc.

It does have its drawbacks though, which I will highlight here. They don`t accept quantities, for example our company generally only has one quantity of each item so when that is purchased it needs to be displayed as sold, this isn`t possible with PayPal. We got around that problem with some nifty. asp scripting on our end of the site. When the checkout procedure reaches our successful payment page it is then displayed as sold on our website.

Also the £500 spending limit on unverified accounts can prove a sticking point if you`re products are of a high value. Due to those two quite major problems we will be moving to Protx ASAP, which still provides fantastic transaction fees without any of the drawbacks.

Has anyone else had similar problems with PayPal?

 

[IMEX Sourcing Services]

I am not sure if its directly relevant, although I would like to know, isnt paypal the easiest to set-up? Also do you need to have a business bank account to actually set-up paypal (I guess you dont) ?

 

[GamesMission]

There are also some UK based "All in one" bureau accounts that allow you to use their merchant account

These are:

www.metacharge.com
www.optimalpayments.com
www.worldpay.com

Other options include

www.2checkout.com
www.durangomerchantservices.com (not tested)

I urge people to check these out.

But all in all the best option is still getting a IMA number (internet merchant account number) from your bank and then use a 3rd party psp such as protx, datacash etc

You could also try www.paypal.com, www.nochex.com and www.natwestfastpay.com

I hope this helps!!

Cheers

 

[jasonj]

I have recently advised two of my clients who we are designing ecommerce websites for to use paypal to take the payments. Any small business wanting to get into ecommerce is being charged through the roof with £250 set up costs and £25 per month costs. If you start turning over 4-5k per month then worldpay and other authorisers are worth considering. If your a small business testing the water then paypal is the way to go.

We can help companies who want to get into ecommerce develop a professional looking site at a reasonable cost. www.3k-design.co.uk

 

[simon-at-shopfitter]

Interesting thread and it highlights that there many differing views about online card processing.

We at NOCHEX are keen to work with internet vendors to provide merchant accounts that are equivalent to Worldpay's World Direct account (i.e. combined merchant account and payment gateway).

The good news is that we're improving our payment pages and functionality all the time to provide a professional looking service.

Something that is worth mentioning is that our rates are lower than PayPal, our anti-fraud activities are robust and as standard we provide chargeback protection (subject to certain limitations that shouldn't affect most small businesses) on our basic seller account.

We also do listen to our users and respond to customer support queries as quickly as we can, which is an advantage for UK based small businesses who don't have dedicated IT staff.

If anyone has any comments or queries then please feel free to contact us, either here directly to me or visit our contact page at http://help.nochex.com/esupport/index.php?_a=tickets&_m=submit



Simon
Communications Manager
www.nochex.com

 

[kyber]

Simon,

Do tell me more about the "merchant account" offering. There is no information on your website, just a get in touch request.

Stuart

 

[simon-at-shopfitter]

Hi Stuart,

The reason the website only says 'get in touch' is because we tailor the service to suit your needs rather than providing a prescribed level of features.

We will be rationalising our product offer soon, however, in the meantime I can tell you that we can be flexible on a number of account parameters depending on your status and transaction levels.

Sorry this is a bit vague but it really is determined by looking at a number of variables and requirements on an individual basis.

I hope thats of some help.



Simon
Communications Manager
www.nochex.com

 

[kyber]

Some. I shall PM you. Thanks.

 

[spigmite]

Hi Simon-at-NoChex,

I was testing both Paypal and Nochex out initially but found that with NoChex, on some orders, the confirmation email failed to contain the buyer's address details. As this isn't listed as part of one's account details when logged into the site, this meant I had payments, but no delivery addresses. When I emailed customer support (numerous times) they simply said that 'oh yes, we're aware of this problem'. No suggestions of a work-around and not forthcoming about how any fixes were going.

A shame, as I would have liked to use a UK company. Obviously though I went with Paypal in the end.

Nick

 

[simon-at-shopfitter]

Hi Nick,

This is something that we have addressed recently.

We're phasing in new payment pages etc. which include all the information that you're looking for. This will be well underway soon so if you decide you'd like to take another look at Nochex please feel free.

There is a large volume of accounts to be migrated to our new system, so if you already have a Nochex account that you'd like to use please watch the Nochex website for news and instructions on how to implement the changes.

I hope thats of help.



Simon
Nochex

 

[whitesparkpromo]

We use protx for authorisation with our own merchant account.

This works out much better for us as the % on transactions is really low.

Apparantly a lot depends on your business.

Worldpay has a great reputation, but waiting 4-6 weeks for money must hurt cashflow. I only wait 2 days!

Stu

 

[spigmite]

Hi Simon,
You should have told yr support people to be more forthcoming with that information! -- as a result of being in the dark about whether nochex was doing anything about it, I got myself up and running with Paypal.

I'll bear it in mind in the future though.
best,
Nick

 

[cantspel]

Hi,

I'm surprised no one has mentioned how often ProTX are down.

In April and May 2005 they for offline for far to long due to a Distributed Denial of Service attack (DDoS) and recently they have also had intermittent problems.

I get the impression that they do not have the capacity to handle modern hackers and suggest that they are cheap for a very good reason - their service is poor!

 

[Ozzy]

People I have spoken to know I personally do not trust Protx because of their companies history, but they seem to have secured some high profile support from the likes of LloydsTSB. I don't know why but then theer goes.

I am impressed as a consumer that NoChex have put themself in the public by taking part in a forum such as this, it reminds you that they are human and willing to help.

I have used Worldpay since they were just a small private company of 5 people, and was pretty much their first partner when they launched their partner programs. Things have changed a lot since Royal Bank of Scotland acquired the remaining shares and took the company right over. Some of the people I used to know well are still there but its a lot of new meat and the customer service levels have dropped through the floor. Shame because generally their technology and service is very good, just their support team are dead from the neck up when you try to solve a problem.

One day I will probably leave Worldpay but because of my contacts and history there the rates they charge me are lower then any other provider can match. I've shopped around and not even Protx can match the rates

 

[Dynamic-Xchange]

I would suggest the DXGlobal Payment Console.

. : What Is The DXGlobal Payment Console? : .

The DXGlobal Payment Console is one of the most exciting services to be provided by the DXBusiness range of services. The DXGlobal Payment Console allows businesses to integrate a single payment method onto their web site and simplify their transactions between their customers. With over 30 payment services and over 50 payment options the DXGlobal Payment Console is just the solution you're looking for.

By providing a central management console for your payments you can eliminate the need to have multiple payment buttons on your web site and allow you to present your checkout in a clean and professional manner.

Best of all, the DXGlobal Payment Console can be used and implemented for FREE and even better still, allows your business to claim a bonus on the payments processed through your DXGPC!


. : Who Can Use The DXGlobal Payment Console : .

Any registered DXBusiness can make full use of the DXGlobal Payment Console for their web sites. Features provided within the DXGPC allow web site owners and developers to seamlessly integrate multiple payment services with minimal coding. By providing your customers with the broadest range of payment options you make your customers experience more enjoyable and keep them returning again and again.


. : Where Do The Funds Go? : .

As the DXGlobal Payment Console is a gateway between your web site and external payment services, the funds remain in your external accounts or services. This provides you with some unique benefits:

- Never worry about checking multiple services to see if a payment has been processed as all your payment logs are contained in one easy service.

- Use only the service you feel comfortable with or maximize your service acceptance. By providing you with the option to customize the services that you wish to accept you can add or remove a payment service within minutes.

Visit - https://www.dxinone.com/?DXLink=103373 and then click on the 'Find Out More . . .' link below the flash presentation.

Also to find out more information about DXBusiness Services click here:

http://www.dxinone.com/DXBusiness/General/General.Overview.asp

Hope someone finds this useful.

 

[cantspel]

Hi,

Has anyone tried Velocity Pay?

http://www.velocitypay.co.uk/

Rates are £18 + VAT fixed a month for under 350 transactions, then 0.1%.

Might be worth a look as cheaper than ProTX![/url]

 

[enigmatix]

If you use paypal on your site... does the Customer need a paypal account to proceed with the purchase?

I mean that would be a pretty big BLOCK on getting payments.. if you come to the pay option and paypal is the only option and then you have to create an account to purchase using paypal.

 

[cantspel]

Yes, I believe you need a Paypal account to pay with Paypal.

Reasearch has shown that users don't trust sites as much that use such obvious 'partner' payment systems.

If you have the time and skills it might be worth trying something that uses direct payment in to a merchant account and does all the checking invisably on your own site, such as ProTX direct or Velocity Pay.

 

[Dynamic-Xchange]

No they do not need a PayPal Account to pay via PayPal. They can simply be taken to the purchase screen and pay through the PayPal service via their Credit or Debit Card.

 

[Dynamic-Xchange]

I would suggest the DXGlobal Payment Console.

. : What Is The DXGlobal Payment Console? : .

The DXGlobal Payment Console is one of the most exciting services to be provided by the DXBusiness range of services. The DXGlobal Payment Console allows businesses to integrate a single payment method onto their web site and simplify their transactions between their customers. With over 30 payment services and over 50 payment options the DXGlobal Payment Console is just the solution you're looking for.

By providing a central management console for your payments you can eliminate the need to have multiple payment buttons on your web site and allow you to present your checkout in a clean and professional manner.

Best of all, the DXGlobal Payment Console can be used and implemented for FREE and even better still, allows your business to claim a bonus on the payments processed through your DXGPC!


. : Who Can Use The DXGlobal Payment Console : .

Any registered DXBusiness can make full use of the DXGlobal Payment Console for their web sites. Features provided within the DXGPC allow web site owners and developers to seamlessly integrate multiple payment services with minimal coding. By providing your customers with the broadest range of payment options you make your customers experience more enjoyable and keep them returning again and again.


. : Where Do The Funds Go? : .

As the DXGlobal Payment Console is a gateway between your web site and external payment services, the funds remain in your external accounts or services. This provides you with some unique benefits:

- Never worry about checking multiple services to see if a payment has been processed as all your payment logs are contained in one easy service.

- Use only the service you feel comfortable with or maximize your service acceptance. By providing you with the option to customize the services that you wish to accept you can add or remove a payment service within minutes.

Visit - https://www.dxinone.com/?DXLink=103373 and then click on the 'Find Out More . . .' link below the flash presentation.

Also to find out more information about DXBusiness Services click here:

http://www.dxinone.com/DXBusiness/General/General.Overview.asp

Hope someone finds this useful.

Following on from my previous post an integration guide has been released to aid people in the setting up of the The DXGlobal Payment Console into your own website.

https://www.dxinone.com/GDTDownloads/PDF/DXGPCUserGuide.pdf

Hope someone finds this useful.

Best Regards,

Simon.

 

hey everyone.
here is lisa from Shanghai China. I own a e-store. I have been on e business for a long time. I have some customers in EURO. but I meet a big problem. that is how to get payment from customers. Customers perfer credti card payment. But i have no UK bank account to set up online payment account. would you give me some advice ? Is there any good online payment that good for Chinese sellers.
thanks a lot!

 

[MarkPearson]

Does anyone use www.velocitypay.co.uk?

Your feedback would be nice

 

[thegateways]

I've not heard that name so far, if you're looking for good solution especially for European country you can check it with chronopay.com, they are having good service and support and their charges are quite affordable.

 

[Norseman]

Sorry, I've deleted my post

 

[etechsupport]

Good advice You can add chronopay.com another stable and reliable payment processor especially for EU.

 

We have used Nochex from day one and have found the system to be excellent both for the buyer and trader. Funds are transferred to your account quickly and transactions so far have been smooth.

I used Paypal when i had an Ebay account but they caused me too many problems and locked the account for stupid reasons and then you couldn't get any sense out of their 'customer services'.

 

[ink4-u]

i like NOCHEX best, but try and let a customer try and pay you more than £100 in the same transaction.