Advice on Selecting an Online Payment Gateway

Merchant Warehouse |

December 7, 2010

Even though many online payment gateways are pretty rich in their feature list, you will still want to spend some time comparing them to other gateways. In this article we explain how to go about determining the best online payment gateways and options for your business. Even if you go with a “package deal” with a credit card processor, one which includes the payment gateway, you will still want to compare all the parts of the package with those of other potential deals.

Different gateways have proven better in different environments, and the reasons for that can at times become quite technical. Take the time to research the “specs” and capabilities (and the compatibility) of different online payment gateway packages and offers. If you’re questioning your judgment or have any confusion, or are perhaps not quite certain what might be the best product for you according to your business practices, then you need to make any potential companies supplying your package (or individual gateway product) explain things to your satisfaction. An experienced salesperson should have the ability to fit your firm with the correct products and describe the positive and negative aspects of different gateways, and do so in language you understand.

Step by Step

If you are running an e-commerce business, your search for an online payment gateway may be less lengthy and confusing. If, in fact, you already have a shopping cart on your site, all you need to do is simply mention this to a sales representative when you call. This sales rep could be working for a gateway firm, payment processors who package their deals or some other kind of merchant account company. You can get to this point with your business in a number of different ways.

Usually off-the-shelf shopping cart packages, such as you may have used for your own website, will be compatible with most all of the major online payment gateways. If your business has put together its own shopping cart and database systems you might want to consider that having your technical support person review the documentation for the gateway you choose is perhaps the best option.

AVS Protection

You should make sure that the gateway, at the very least, offers Address Verification System (AVS) protection. The use of AVS reduces the chance that fraudulent transactions will be processed, as it will verify the cardholder’s billing address with the specific card issuer. Depending on the details of your package deal or your existing system, using AVS on transactions might also result in a reduction of fees charged by your merchant bank. This is certainly something to inquire about.

You should ask about other types of transaction protection that are offered to you as a merchant using a particular gateway. It may be that these additional protections will be considered “premium” services, with extra charges added to your basic service fees. Naturally, this will be dependent on the type of products and services you are selling, and your customer profile, but extra precautions may be necessary. If you are in business in certain categories, such as youth- or high-technology-oriented products, it’s probably a good idea to pay for extra services, since the chargeback rates on fraudulent transactions in those categories are statistically higher, and can cost you substantially ($30? $60?) for each separate incident.

Decision Time

When making an informed decision about this matter, you should do some research on credit card fraud, the costs and statistics, etc. Then you will understand how to protect yourself best, as your research will lead you to learn about strategies to reduce credit card fraud. The “crooks” study diligently to rip you off, and you must be just as diligent in rebuffing those attempts.

Major, reputable merchant account providers will carry all of the major online payment gateways, although they may prefer and recommend one over another. You can browse through all of them in the sections for payment gateways at the various provider sites. Whatever choice you end up making, an investigation of the various payment gateways, and the features that are most important to your firm, will prepare you well for your final decision.