Selecting a payment method for your Ecommerce Store

I am going to talk about payment gateways and how you can receive payments on your website for all the lovely goods that you sell. There are basically three different ways that you can receive money on your website.

There is the do-it-yourself solution where you gather credit card information yourself and you process them yourself via your own means. There is also server integration by API which means that the data is passed from your website to another website into a handshake transaction. And there is the redirect solution which means that the customer, the buyer, is actually redirected to a totally different site to complete the transaction & then return to your website.

The third mentioned above, used to be the preferred method or at least it was a very standard method. You would be quite familiar, a few years ago, visiting a site and getting your shopping cart all sorted, pressing go and then having to be redirected.

This always felt like the website from where you were buying the goods just did not want the responsibility of actually taking the card payment. I personally always felt a little suspicious of the idea of another company being in control of my card details.

So people became more trusting of the do-it-yourself solutions, for example if you buy products from some of the big brand websites, they are actually gathering credit card data. You are putting the data straight into their website and their own systems in the background are processing the credit card information.

That sounds great but actually and certainly as a small business that is not what you want. One of the main reasons is that of security and also actually holding the data. As soon as you get anywhere close to credit cards all sorts of different protections are then required for your servers such as PCI compliance, which essentially means that appropriate restrictions are in place for server access. So for anyone who is a small operation, then this really a non-starter. 

The intermediary solution, the server redirect and API integration, this is quite a good method in that the main benefit is that people will stay on your site, or as far as they are concerned they stay on your site, during the transaction process.

You tend to build something within the page such as a timer to indicate that something is happening.  And actually in the background your system is talking to some kind of payment card gateway and then being given a yes or no based on the credit card information that was given.

This is all fine but if you are developing your own website this can be quite a complex thing to integrate. Simply because you have to have the full list of API functions from the credit card supplier, you have to go thorough lots of testing back and forth of various scenarios. And this actually is quite a lot of work and therefore expensive to get going.

One of the main reasons that the third option of redirection has come back into play is actually because of the software as a service websites now. What I mean by that is that you host your website on somebody else’s shopping cart and you add your own identity. The reason that redirection is back in the frame again is because it is much easier for you to enter your PayPal account into your software cart.

When people make a purchase they are redirected to PayPal, as an example and on the PayPal page you have simply said to PayPal "please transact for this amount for this email address", and then they are handed over to PayPal for the duration of that transaction then passed back again to the website.

So this is a relatively clean way to allow anyone to take transactions from day one. Some software solutions do allow you to, what we might call the second method which is an integrated method using web-payments pro via PayPal.

But just to get going on day one, actually the old view, in that redirection was a bit cheap and cheerful, really has disappeared now. I am hearing from a lot of companies that they like the fact that they are redirected to PayPal, they transact on PayPal all the time and getting into the PayPal world has been beneficial for many.

Don’t feel that because you have a redirection you are in anyway less than the bigger sites. It’s all about payment transactions that are quick, reliable, fully traceable and easily reversible.

Companies like PayPal might charge you with a higher percentage but you will be saving a great deal of money in terms of upfront development costs. So you do need to weigh this up but you will most definitely be better off with PayPal and being able to trade online from literally day one in a trusted environment. 

Author: Sadhiv Mahandru.
Website: Search engine optimisation Oldham