E-Commerce Website Payment Gateways

January 17, 2011 accept payments online, authorize.net, google checkout, paypal Resources No Responses

When you are ready to take you online business to the next level with ecommerce, there are multiple options when accepting payment online. Online payments can boost your revenue considerably if implemented correctly and effectively. I will focus on 3 of the most popular payment methods that I have worked with extensively: PayPal, Authorize.net and Google Checkout and the possibilities that exist for using each one.

PayPal is the faster, safer way to pay and get paid online. The service allows members to send money without sharing financial information, with the flexibility to pay using their account balances, bank accounts, credit cards or promotional financing. With more than 87 million active accounts in 190 markets and 24 currencies around the world, PayPal enables global ecommerce. PayPal offers 3 methods of service to accept payment online: Express Checkout, Website Payments Standard and Website Payments Pro.

PayPal Express Checkout

PayPal Express Checkout allows your website visitors to pay using their personal or business PayPal account. The visitor must have a PayPal account to use Express checkout. This option will be chosen by a visitor who is obviously familiar using PayPal versus entering their credit card information. If you have Website Payments Pro or Website Payments Standard integrated you are required to offer Express Checkout as a payment option. PayPal Express Checkout can also be offered in addition to Authorize.net, Google Checkout or any other merchant service you may utilize.

PayPal Website Payments Standard

When a customer pays using PayPal’s Website Payments Standard they temporarily leave your web site and go to PayPal to enter their credit/debit card information. This process is relatively painless but may not be ideal depending on your website setup and the nature of your products. The benefits of using PayPal’s Website Payments Standard include:

Easy set up
No monthly fee
SSL (Secure Socket Layer) is not required for your website since the actual shopping cart and checkout page is hosted on PayPal and not your web site.

PayPal Website Payments Pro

PayPal’s Website Payments Pro is PayPal’s merchant service that allows you to accept credit cards directly on your website. The funds from the transaction will go to your PayPal account. As with most merchant accounts there is a monthly fee associated with Website Payments Pro (currently $30). PayPal Express Checkout must be included as a payment option with PayPal Website Payments Pro.

Authorize.net provides a payment gateway for you to accept credit cards directly on your web site. The benefits of Authorize.net include low cost and direct integration using a trusted merchant service provider. Authorize.net can be used to process credit cards in addition to offering PayPal Express Checkout and Google Checkout.

There are a variety of ways to integrate with Authorize.net. Typically, I will integrate Authorize.net directly with a shopping cart or custom checkout application on your website. I am a Preferred Partner of Authorized.net. Please use the “Sign Up Now” button below to start the application process for your merchant account.

Google provides another payment option for shoppers who prefer to checkout using Google Checkout. Google Checkout is a new service that makes online shopping faster, more convenient and more secure.

Visitors must have a Google Checkout Account or register for one to pay using Google Checkout. With Google Checkout, Google simply stores the visitors credit card information and transfers the funds to your bank account. There is a fee associated with each transaction. Google Checkout can be implemented in addition to PayPal and Authorize.net.

How It All Works

Payment Processing Flowchart
As you can see from the above flowchart, the Payment Gateway is responsible for processing the credit card and initiating the payment. The best part is you don’t need a separate merchant account to accept credit cards online, the payment processors serves as the merchant account for you for a small fee, but there are still some exceptions and for those you still need to have your own merchant accounts.

Features

eCheck Payments – eCheck is short of Electronic Check. It’s a check payment processed electronically by providing bank details, but it can take some time to clear, and can also be returned just like a physical paper check.

Virtual Terminals – Virtual Terminal simply means you can accept credit cards by phone, fax or even mail, and you can enter the credit card information from a desktop computer, laptop or smartphone.

Recurring Billing – The concept of recurring billing is simple; it automatically collects payments from customers after a predetermined span of time, like monthly, quarterly, bi-annually or annually. It is typically used for membership or subscription products.

AVS – Address Verification System, is a fraud prevention system which will mitigates chargebacks. Here’s how it works, it matches the zip code of the shipping address with the address on card, if there’s a mismatch the payment is declined. Fraudulent activity cannot be stopped 100% but it can be reduced drastically.

CCV – CCV (Card Code Verification) is the security code on the back of consumer credit cards. This feature compares the card code submitted by the customer for the transaction with the card code on file for the cardholder at the card issuing bank. If the CCV entered does not match the one on file then the transaction can be declined based on the CCV response.

Easy Integration – Fully integrating the payment processing system within your own website can be done fairly simply if you have some HTML knowledge. If not, it’s best to hire a professional web developer. Certain services, such as PayPal, redirects users to the secured PayPal website to process the payment and after the payment is approved, the user is redirected back to the original website. Another method is using an API to easily integrate it to your shopping cart script. This method is much more secure and relatively seamless.

Website Payment Gateway Recommendations

As a web developer, I deal with many different types of clients with very specific needs. Although there are NUMEROUS payment processing services out there, I have only listed the ones that I personally recommend and have worked with myself. There are not only very well know in the industry but they are also very reliable, secure and offer several integration options.