Taking Payments Online - Gateway/Costs

[i234i]

Hi folks,

Just wondered if any of you who take payments online can give your thoughts, experience and advice on the below for me please.

I'm looking to do this online for our business and haven't done so before, because of the service i want it to be totally integrated to our website.

I'm aware i need:
1) Payment Processor
2) IMA
3) Business Bank Account

I've been looking at Sagepay etc and the various other options.

I'm trying to work out a total cost per transaction or as near as possible, as we are a music venue we will be adding our event tickets to the website too, so want to offer the booking fee to be as near to the cost as possible to make them as cheap to purchase. (Websites already built etc)

What are the costs associated with the above? Do all 3 of the parts come with there own charges (Payment Processer, IMA and Business Bank Account) for this our business bank account is free for a year, but on the other two, is there a charge for both or just for the processing of payment? Does the IMA hold money and is this charged or does it just go straight to the Business bank account?

My other question which i suppose is a bit of a main one is, how long does it take in your situation or experience for the money to appear in your business bank account, i've heard of some of the companies holding it for lengthy periods etc.

Just trying to get all costs involved from Customer paying online to actually being in my business account and the timeframes around it

Do you recommend i contact anyone else or suggest a Gateway for us to look at?

 

[Sparx]

Typically you can expect transactions to take 3-4 working days to process from your IMA to BBA - this happens automatically.

If you try get the payment gateway and IMA separately, you may find the merchant account provider charge extortionate set-up fees (£100-200+). You would be best speaking to companies such as Cardsave or PaymentSense who offer both, in fact I think even SagePay can offer both now as they have a deal with a merchant account supplier.

I'm not sure on PS' or SagePay's prices, but Cardsave typically offer 'the package' from £15-30 per month depending on your requirements.

Lastly, you then have the 'per transaction charge'. You can expect to pay anywhere from 1.2 to 3% on your credit card and 15-35p on your debit card transactions.

Hope this helps.

 

[LMDServicesUK]

Sparx has got it bang on, but I would another few things to consider

What you are setting up is in a High Risk Business category for an Merchant Account provider, be prepared to provide business plans, projected P&L, Cashflow etc in support of your application.

As a start up business some Merchant Account Providers may impose special terms on you ( delayed payments / rolling Bond for 12 m) so be prepared for that in your business plan.

In PaymentSenses case, we do normally charge a set up fee for the gateway as there is no underlying contract to fund the set up costs, but it does include the merchant account set up, again without contractual requirement.

Upside if you get all the info we ask for and the Bank are happy, you would have a decision in 72 hours from submission and could be live on your gateway in 48 hours thereafter. Nobody else in the UK can offer this fast a turnaround.

Re SagePay, yes it is a mature product, but expensive for what it actually does, and there are lot better gateways out there (more reliable, more functional, lower cost) so do not default to SagePay look around first.

Also when researching g/way providers always let them know who your shopping cart provider will be no point finding out your great gateway wont work with your chosen cart..

Good luck

 

[HobbyMounts]

Interesting topic. I have just been to my bank )LLOYDS TSB) and setup up a new business bank account and spoke to someone from their IMA dept, who offered the following deal:-

£99.00 setup cost

£5.50 per month for the service

1.25% on credit card transactions

16.5p on debit card transactions

2% on corporate credit card transactions

25p on corporate debit card transactions

2.5 - 3.5% on AMEX transactions

2.49% on DINERS transactions

£10 a month minimum throughput required

12 month contract with a £200 cancellation fee if cancelled within that perioid.

Plus optional, ClientLine at £4.99 a month, although I didn't really understand what this was.

How does this deal stack up with other reputable IMA providers?

 

[Sparx]

@HobbyMounts

That is actually a fairly decent deal. Is this just for an ECOM or MOTO merchant account? No payment gateway included by the sounds of it.

ClientLine is just an online reporting tool, the website is www.myclientline.net which has a Demo page.

Don't forget to ask what the terms are after the initial 12 month contract; cancellation notice, option to review charges after initial 12 month period, etc.

 

[HobbyMounts]

Thanks Sparx, I'm guessing it's a MOTO, I'd not heard of those phrases until tonight. Lloyds said they didn't have a payment gateway service to offer at the moment, although they said they are working on one.

They recommended UPG >>> http://www.upg.co.uk/pricing

To be honest, although I understand the pricing on the Merchant Account, I don't understand anything on that website :|

Not really sure what I should be looking at or comparing.

Any help appreciated.

 

[Sparx]

MOTO stands for Mail Order Telephone Order. This is also typically called a 'Virtual Terminal'.

What kind of payments are you planning on taking? If you want to accept payments via your website so customers can go on your site and pay you themselves then you want an ECOM (Ecommerce) account.

If you are only wanting to take payments over the phone then a MOTO account with Lloyds and a Virtual Terminal system from UPG (if you prefer them) is all you need.

UPG basically are being offered as the 'payment gateway' between your website (if Ecom) and internet merchant account with Lloyds Cardnet (if you went with them).

If you clarify what you are planning I don't mind suggesting which package would be best if you wish to opt for UPG.

 

[LMDServicesUK]

Hi Hobbymount

Also when looking at Payment Gateways, most of the better ones include an equivalent tool such as ClientLine as part of the service at no extra cost.

Also the pricing for the gateway will normally be a monthly fee plus in some cases a per transaction fee.

Re the rates they are a slightly strange mixture, what exactly are you going to be selling ? also no mention of PCI fees, I would strongly suggest you get the figures discussed in the form of a formal quote so you know you have all bases covered.

Do you need to take Diners & Amex ? If not you will open up your choices as to who can provide your merchant account.

Rgds

Mark

 

[HobbyMounts]

Yes, we'll be taking payments online from the website in my sig.

Not sure on Diners & Amex, I guess not a great deal so open to other suggestions.

I didn't hear PCI fees mentioned by Lloyds or is that something the payment gateway provider charges?

 

[Sparx]

You will want to ensure they are providing you an ECOM (Ecommerce) merchant account then - not a MOTO account.

PCI is the responsibility of the acquirer to enforce (Lloyds) - but usually other related parties (i.e. UPG, SagePay, etc) do tend to 'prompt' you to ensure you are PCI compliant.

I would ask Lloyds what their current stance is and costs are for PCI. All acquirers are now enforcing this and it is at the very forefront of the industry currently being pushed.

I would personally not bother with Amex or Diners unless you think your target market will use these. As you can see there rates are much higher than typical Visa/MC credit cards.

 

[LMDServicesUK]

PCI Management fee from LloydsTSB Cardnet (the Merchant Services provider who actually operates your merchant account for you), will be approx. £ 4.99 per month.

They should arrange for you to have access to the PCI compliance Portal where you will be invited to self register and depending on your resultant profile you will be assigned the appropriate SAQ to complete and also be prompted (possibly) to have your web site IP address scanned.

Once you are accredited it is valid for 12 months after which you then have to be reaccredited.

You will have a 3m grace period, thereafter the fines will be between £ 50 - £ 70 per month until you get accredited.

Hope this helps

 

[reclusive46]

I would personally not bother with Amex or Diners unless you think your target market will use these. As you can see there rates are much higher than typical Visa/MC credit cards.

I actually found out that it was worth taking Amex because if you don't Amex cardholders always seem to pull out another reward card (Often Capital one World/World elite card) or natwest your points card, you then normally end up being charged another 1%(Varies slightly) anyway in a "premium" card charge.

Now you get charged around another 0.6% for out of EU transactions, Amex could quite easily end up cheaper. You at least know what you are going to be paying with Amex.

Since pretty much all foreign credit cards seem to be World or Signature cards that could be an extra 1.6% on top of your normal rate.

My Amex rate dropped after the first year as well.

Also remember by taking Diners Club you can also accept JCB, China UnionPay and Discover, which is handy if your business involves customers more far afield.

 

[Baldini]

Dunno if this helps much, but my recent experience would advise avoiding Barclays for a merchant account at all costs if your business is deemed high risk.

 

[Talay]

I actually found out that it was worth taking Amex because if you don't Amex cardholders always seem to pull out another reward card (Often Capital one World/World elite card) or natwest your points card, you then normally end up being charged another 1%(Varies slightly) anyway in a "premium" card charge.

Now you get charged around another 0.6% for out of EU transactions, Amex could quite easily end up cheaper. You at least know what you are going to be paying with Amex.

Since pretty much all foreign credit cards seem to be World or Signature cards that could be an extra 1.6% on top of your normal rate.

My Amex rate dropped after the first year as well.

Also remember by taking Diners Club you can also accept JCB, China UnionPay and Discover, which is handy if your business involves customers more far afield.

When you are talking about a couple of percent maximum and as you notice, less than that in many cases, you risk losing a sale because you don't take Amex.

Of course you need to review the bigger picture and the impact on rates available for your non Amex business but I think the Amex hate is unjustified if other terms can be as attractive.