It's easy to get confused by the multitude of payment processing options - here we try to debunk many misconceptions and recommend options for clients.
What is the Process?
When a customer makes a purchase online the first thing to happen is the payment card is processed through various fraud checks and declined or authorised. If authorised, the merchant bank account of your online business can then take the payment from the payment card (VISA, Mastercard, etc) - this transaction typically processes overnight (ie: is 'settled') although can take considerably longer.
Once the monies are deposited into your merchant account, you can then move the funds to your business current account. There may be time-delays between these transfers, as banks hold on to the money to i) protect against fraud, and ii) earn themselves interest.
The payment processing is a separate process to the transaction, but many services (often referred to as 'Payment Gateways') will offer both. Each will have their own costs and fee structures, and it is worth reviewing your rates periodically as these change.
All in One Solutions
Services such as Google Checkout, Paypal, Worldpay, Authorize.net and many others offer the payment processing and the merchant account service combined. The fees are typically 1.5%-7% of the transaction + 20p-30p per transaction (see Google's fee structure and Paypal's fee structure). These services generally do not make a cost distinction between credit or debit cards, and the higher the turnover the lower the rates you will get.
Some have integration tools so the transaction may take place on your own website, but in most cases the customer is taken to the payment service provider's own secure website to make payment and then returned to your website once processed.
Payment is generally held for a period of time (a few days to a few weeks).
For those starting out in the world of ecommerce (with generally lower transaction values), we recommend using Google Checkout or Paypal. If necessary you can switch services when the level of turnover reaches a level where it is prudent to do so.
Integration with your Website
4W Web Design can integrate any payment processing service you choose, either as a simple solution redirecting clients to the secure payment service, or fully integrated using an API where the customer remains on your website during the process. Both are fully secure and no sensitive data is stored on your own website's server.
Secure Trading
We have worked closely with Secure Trading over the years and can recommend their service as they provide excellent tools and support for websites requiring integrated payments, where the customer does not leave your own website.
Payment are authorised and your Internet Merchant Account will then take the money from the payment card issuing bank overnight.
Secure Trading charge a £100 set-up fee, £15 per month account fee plus 30p per transaction processed. Based in the UK they are fully PCI compliant and provide 3D Secure.
They also offer a new all-in-one Internet Merchant Account and Payment Gateway solution with Lloyds TSB Cardnet: £150 + VAT set up fee, 2.75% on all settled credit & debit card transactions subject to a monthly minimum invoice of £15 + VAT.
Internet Merchant Account
In the UK, internet merchant accounts typically cost £200-£300 to set-up (no annual fees) plus 2% on credit card transactions and 20p-30p on debit card transactions. They hold your money for a period of time (24hrs - 10 days) and may also impose other restrictions based on your trading history, so your own high-street bank is probably the best approach, especially if you have an existing normal merchant account.
