Ecommerce payment gateway options for small businesses


If you are interested in setting up an ecommerce website or if you currently have an online shop selling products online one of the most important choices, you will make is around the payment gateway.

What is a payment gateway - the basics

Let’s start with the basics. A payment gateway is a service which allows you to process debit and credit card transactions. Most of the banks offer payment solutions and then there are specialist companies such as Stripe, SagePay, PayPal and WorldPay. In simple terms its just the code that sits between your business and the customer and allows them to move money via a debit or credit card from their account to your account. In return for providing this service they will then charge a fee.

Payment gateway charges

In recent years the fees to process card payments have decreased in part due to more choice but also in the early days of the internet online payments were less common than they are today and as such the cost to businesses to process them was higher.

We deal with a few different payment gateways and they vary in charges however some charge a monthly fee and most also charge a percentage of the transaction. Most also charge a flat rate per transaction so an example is that you may pay 1.4% of the transaction plus 20 pence. There are some gateways, such as PayPal, who will charge a sliding scale for the transactions based on the volume of sales you do each month.

In our view you should not use a payment gateway that charges a monthly fee as a fee per transaction is offered with several good gateways.

PCI compliance

The payment card industry (PCI) regulations dictate certain factors so when dealing with card payments, both online and offline, you need to understand the rules. These rules are complex and warrant an article individually so in due course we shall publish a detailed article on this. For now though just be aware that there are regulations surrounding what you can and cant do with card payments and that these rules are designed to protect all parties so exist for very good reasons.

Our 2 favorite ecommerce payment gateways

From all the different ecommerce payment gateways available we have our favorites.

Firstly, any ecommerce business should be familiar with a gateway called Stripe. This is a relatively new payment gateway, but we have worked with them for several years and they offer first class support for both businesses and developers. They offer a variety of different payment integrations and can offer a solution that is fully PCI compliant so there is no additional risk or cost to a business using them to process card payments. In terms of charges they are fair although there are other gateways which are cheaper but do not offer the same quality of user experience.

Our second pick is PayPal. Although arguably an expensive option for businesses they do offer a sliding scale so as your volume of transactions grows each month the transaction fee will decrease. The main reason for suggesting for looking at PayPal is that it makes checkout simple for consumers and as ecommerce is largely about conversion it’s an option that all businesses should explore. Again, like Stripe it can be integrated in a PCI compliant fashion saving you additional costs associated with onsite payments.

Both Stripe and PayPal have no monthly fees.

Expert help with ecommerce websites

Picking the right payment gateway is an important choice and it maybe that you work with several. For example, many of the ecommerce websites we create offer debit and credit card payments via Stripe and then PayPal for people who have a PayPal account. Every individual item which can impact on your website conversion should be considered carefully as if we assume that an example ecommerce website obtains a 3% conversion you can see the important of this. Changing a few small things could give you a significant uplift on your total sales.

If you are looking at improving what you do online or if you are interested in finding out more about ecommerce, then please get in touch and one of our team will be happy to share your experience.