How to consider which payment methods are best for your ecommerce store

There are many, many ways to accept payment on your ecommerce store these days. They all serve different purposes with different services, but also there is a lot of overlap.

Timeframe to implementation

I consider this critical for many clients who want to get started quickly. There are lots of barriers to implementation for some services, so having something quickly can be the top priority.

If you’re in any way looking at a service that involves your bank, you can expect the process to take longer – up to 3-6 weeks.

Ask the payment service provider how much time is likely involved and what it could stretch to depending on circumstances.

Your preference versus client preferences

We have clients who hate Paypal, and want to use Stripe. We have clients who absolutely love Paypal, and absolutely hate their bank. Be careful not to let your own preferences cloud your judgement, at the end of the day it’s what your clients want that will make your ecommerce business more successful.

I personally don’t love accepting Paypal payments in some circumstances, but do love using it to buy things online given its convenience. But, I know many of our clients find it very useful, and when we ended up applying it to our own online stores we observed a 10% upswing in sales as a result.

Consider your profit margins and the overall cost of the facility too. For example, a 3% charge for a per sale service works well until your sales exceed a certain amount and then it may be a good idea to get a credit card facility from your bank who could charge 1.5% or lower.

Credit card, bank payment, cheque

All of these methods you can make available, but again consider your business and be prepared to change to streamline things. For example, having to manually reconcile bank payments against online store sales because you accept people transferring direct to your account after ordering is going to add more time and cost than is perhaps needed to your processes.

Automated processes, where the funds are guaranteed after checkout, will help streamline a small growing business’ ecommerce front and reduce your administration.

Did you know you can streamline and accept bank payment automatically and directly through your website? Ask us how.

As for cheques, we still receive a small dribble of these to our business every month, but wouldn’t offer it as an option for ecommerce unless you are selling high value items to an older demographic that do not have an urgent delivery timeframe.

For credit card, there are so many ways to do this. I cover just a few options below:

Accepting credit card payments via your bank and a 3rd party gateway

This involves setting up a merchant facility with your bank, and then connecting with a well supported payment gateway provider such as eWay or Payment Express (we are a partner), to take the payment from your site and put it into your bank account.

The 3rd party gateway will typically charge an ongoing minimum fee and a per transaction fee.

Then the bank typically charges a per transaction fee, and an ongoing minimum fee too (often waived when you reach a minimum monthly sales threshold).

You do end up with a lot of little fees, but at a certain volume of sales it’s more cost effective this way.

Then there are providers like Stripe, which charge just a % and per transaction fee, but pay the money to your bank.

Paypal also can accept credit card and pay to your bank, but some people feel Paypal makes it not so obvious as to how to simply pay by credit card without signing up to the Paypal service.

Keep your options open with ecommerce payment methods

My overall advice is keep your options open. Consider offering a range of 2-3 payment options. Stay away from more manual payment methods if you don’t need them. It reduces cart abandonment and streamlines the sales process.

If you’re not sure about which is the best method, feel free to contact us for our opinion and advice.