Accepting Credit Cards and PayPal on Your eCommerce Site

Opinions expressed by Entrepreneur contributors are their own. This excerpt is part of’s Second-Quarter Startup Kit which explores the fundamentals of starting up in a wide range of industries. In Start Your Own e-Business, the staff at Entrepreneur Press and writer Rich Mintzer explain how to build a dotcom business that will succeed. In this script, you ‘ll find recipes for success, road maps that pinpoint the hazards, and dozens of interviews with dotcom entrepreneurs who ‘ve proved they ’ ve got what it takes to survive in this sometimes erratic market. In this emended excerpt, the authors discuss the two types of on-line payment processors you can use on your ecommerce site.

Thanks to the increase of ecommerce sites over the past ten years, credit card accounts are now very slowly to set up on your site. The coarse methods of accepting citation batting order payments is either by using your own merchant account or by utilizing a requital gateway report, besides known as a third-party merchant. An internet merchant report gives you the ability to process credit cards and can be obtained through a bank. It ‘s viewed by the bank as a line of credit that ‘s extended to you. You must apply for this, just as you would any lend. A good topographic point to start your search for a merchant account is your own bank. Most emergence credit cards, and if you have a long-run relationship with the institution, that ’ s a boastful asset. What if your bank says no ? Try a few other local banks and flush offer to move all your accounts there or at least set up a business report. You precisely may be rewarded with merchant condition. You ‘ll besides probably need a requital gateway report, which is an on-line credit poster processor or transaction handler that ‘s able of hooking into credit card accounts belonging to the on-line shopper and your internet merchant bill. The requital gateway handles confirmation and transfer requests. It interacts with the circuit board issuer ’ s deposit to authorize the recognition poster in real fourth dimension when a purchase is made on a web site. The leading providers of payment gateway accounts targeting smaller merchants include : If you don ’ t have a merchant account, these providers can help you set one up and offer a payment gateway in one commodious package. credit cards aren ’ triiodothyronine processed stingily, at least not for a inauguration. A distinctive tip agenda for a small-volume account ( fewer than 1,000 transactions monthly ) would include monthly process fees ranging from $ 10 to $ 100, plus transaction fees of about 3 to 5 percentage per transaction. Some providers besides charge startup fees, but denounce around — in many cases the inauguration fee will be waived if you ask. Related: The 15 Most Popular Online Payment Solutions


Entrepreneurs and freelancers are certain to love this free, cloud-based on-line invoice and payments platform because it ’ south been designed for the small business owner. Due provides a wealth of fiscal, account, and project management tools that can save you time and money on non-revenue generating tasks while delivering a professional look and feel that besides reflects your trade name persona. The platform includes a time tracking app, templates for quotes and invoices, on-line invoices for domestic and ball-shaped clients, mobile and electronic mail bill wake and requital integration, report and dashboard functionality, and consolidation with other software like Basecamp. The transparent, low-cost requital options deepen the value that Due offers, including a range of payment credence methods like domestic and international recognition wag process with a flat rate and no hidden fees, digital wallet functionality, and e-cash/e-check acceptance .


PayPal enables any individual or commercial enterprise with an electronic mail address to securely, easily and promptly send and receive payments online. PayPal ’ mho service builds on the existing fiscal infrastructure of depository financial institution accounts and credit cards, and uses promote proprietary fraud-prevention systems to create a safe, ball-shaped, real-time payment solution.

PayPal has cursorily become a ball-shaped leader in on-line payment solutions. There are two major PayPal offerings for merchants. Related: 25 Payment Tools for Small Businesses, Freelancers and Startups 1. Website Payments Standard. This is an easy means to start accepting citation cards online. A simpleton integration into your shopping cart allows customers to pay securely and easily. ( PayPal seamlessly integrates with hundreds of compatible carts or custom-made storefronts. ) If you don ’ t have a shop haul, the free PayPal Shopping Cart can be set up promptly and easily ampere well. After setting up the system on your web site — which takes just a few minutes — you ‘ll be able to accept all major credit cards, debit cards and bank transfers. Website Payments Standard is secure, and you don ’ t need a disjoined merchant history or gateway. Your customers don ’ t need a PayPal report. transaction fees are moo. 2. Website Payments Pro. This all-in-one solution gives you features comparable to merchant accounts and gateways, through a single supplier and at a lower cost. There ‘s a $ 30 monthly fee but no setup fee. transaction fees are listed on the PayPal web site under PayPal Website Payments Pro. With this service, customers paying by credit card stay on your web site for the integral transaction ; PayPal is inconspicuous. web site Payments Pro is already integrated into many popular shop carts, or it can be well added to a custom-made patronize haul. web site Payments Pro includes a virtual end, which allows you to process payments for telephone, facsimile and mail orders. Both merchant and third-party accounts ( aka gateway accounts ) have their advantages and disadvantages. The primary advantages of having a merchant report include :

  • Ease of transaction
  • Protection. Banks are protected by the FDIC and merchant accounts typically come with fraud protection.
  • You maintain control since the transaction is directly between the customer and your merchant account. There’s no intermediary handling the money or getting the customer’s information.
  • Typically you’ll receive payments faster than if you use a third-party payment service.
  • Your business name is on the transaction statement.

Disadvantages of a merchant report include :

  • Cost. Collecting credit and debit cards comes with a price tag for entrepreneurs.
  • You must handle disputes. If you have your own merchant account, you’ll be responsible for disputes, chargebacks and any compliance, fraud or security issues that may arise.
  • Hidden fees. You can get hit with them, so read your contract very carefully.

Advantages of a third-party merchant explanation :

  • You don’t need to get approved for merchant services by a bank. If you have low credit scores or no credit, you can sidestep the approval process.
  • You have a company on your side when disputes arise. They can play middleman and work on behalf of your business.
  • PayPal, if you choose to use it, is a very well known and trusted service for transactions.

Disadvantages of third-party merchants :

  • Potentially higher fees.
  • Their name is on the transaction and possibly links to their sites or those of other businesses.
  • Reputation. Not all third-party merchants are PayPal, and while many have excellent reputations, others are known for working primarily with adult websites. Still others have been cited for fraud. You need to choose carefully.
source :
Category : Finance

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