Online payment processing is the process of accepting electronic payments for goods or services purchased online. It involves a series of steps, including authorization, capture, and settlement of payment transactions. Payment gateways are a critical component of online payment processing as they provide a secure and reliable connection between the merchant’s website and the payment processor.
Payment gateways act as an intermediary between the merchant and the customer’s payment method. When a customer makes a purchase on an online store, the payment gateway encrypts the payment details and transmits them to the payment processor for authorization. Once the payment is authorized, the payment gateway sends a confirmation to the merchant’s website, allowing the transaction to be completed.
In summary, payment gateways facilitate the secure transfer of payment information between the customer, merchant, and payment processor during online payment processing.
Online stores and payment gateways are related because payment gateways are used to securely process and authorize online payments made on an online store. When a customer makes a purchase on an online store, the payment gateway is responsible for encrypting and processing the customer’s payment information, verifying that the customer has sufficient funds, and approving or declining the transaction. The payment gateway then sends a response back to the online store, indicating whether the transaction was successful or not. Without a payment gateway, an online store would not be able to securely process payments and complete transactions with customers.
To link an online store with a payment gateway, you need to follow these general steps:
- Choose a payment gateway: There are many payment gateway options available, such as PayPal, Stripe, Authorize.net, and more. Research and choose the payment gateway that works best for your business.
- Sign up and create an account: Once you have chosen your payment gateway, you need to sign up and create an account. Follow the instructions and provide the required information.
- Configure payment settings: In the payment gateway dashboard, you need to configure payment settings, such as payment methods, currencies, and transaction fees.
- Integrate payment gateway with your online store: Depending on your online store platform, there are different ways to integrate the payment gateway. Most payment gateways provide integration instructions and plugins for popular platforms like Shopify, WooCommerce, Magento, and more.
- Test and go live: Before going live, it’s important to test the payment gateway integration to ensure that it’s working properly. Once you’re satisfied with the test transactions, you can go live and start accepting payments.
Note that the exact steps may vary depending on the payment gateway and online store platform you’re using. It’s important to follow the specific instructions provided by your payment gateway and online store platform.
Intuit Merchant Services
Intuit Merchant Services is a payment gateway service offered by Intuit, the company behind popular accounting software QuickBooks. The service is designed to help businesses of all sizes accept credit card payments online, in-person, or through mobile devices. Here are some pros and cons of Intuit Merchant Services for small and medium-sized businesses (SMBs):
Pros of using Intuit Merchant Services:
- Integration with QuickBooks: If your business is already using QuickBooks, Intuit Merchant Services offers seamless integration and automatic syncing of transactions, which can save time and reduce errors.
- User-friendly interface: The platform is user-friendly and easy to use, with a simple setup process and a dashboard that offers detailed reporting and analytics.
- Competitive pricing: Intuit Merchant Services offers competitive pricing, with no setup or cancellation fees and no long-term contracts required.
- Fraud detection and prevention: The platform offers fraud detection and prevention tools, including address verification and card security codes, to help protect your business from fraudulent transactions.
Cons of using Intuit Merchant Services:
- Limited payment options: While Intuit Merchant Services accepts major credit cards, it does not support alternative payment methods such as PayPal or Apple Pay, which may be preferred by some customers.
- Customer support: Some users have reported difficulty contacting customer support or receiving timely responses to their inquiries.
- Additional fees for certain features: While the base pricing is competitive, some features such as recurring payments or mobile card readers may come with additional fees.
Overall, Intuit Merchant Services can be a good option for small and medium-sized businesses that are already using QuickBooks and want a user-friendly payment gateway with competitive pricing and fraud prevention tools. However, businesses that require a wider range of payment options or need more responsive customer support may want to consider other options.
PayPal is an online payment system that allows individuals and businesses to make and receive payments over the internet. It was founded in 1998 and is now a subsidiary of eBay Inc. PayPal offers a range of services, including the ability to send and receive payments online, link multiple bank accounts and credit cards, and manage transactions from a central account. The service is available in over 200 countries and supports more than 25 currencies. PayPal is widely used for online shopping and e-commerce transactions, as well as for personal money transfers between individuals.
PayPal is a popular payment gateway that allows individuals and businesses to send and receive payments electronically. Some pros and cons of using PayPal for small and medium-sized businesses are:
Pros of using PayPal:
- Easy to set up and use: PayPal is user-friendly and easy to set up, even for those with little technical expertise.
- Trusted and reputable: PayPal is a well-known and trusted brand, so customers may feel more secure making purchases through a business that uses it as a payment gateway.
- Wide acceptance: PayPal is widely accepted by merchants and customers around the world.
- Multiple payment options: PayPal supports various payment options, including credit cards, debit cards, and bank transfers.
- Fraud prevention: PayPal offers fraud prevention tools and protection against unauthorized transactions, which can help safeguard a business’s finances.
Cons of using PayPal:
- Fees: PayPal charges fees for transactions, which can add up over time and eat into a business’s profits.
- Payment holds: PayPal may hold funds for a period of time, which can be inconvenient for businesses that need immediate access to funds.
- Limited customization: PayPal has limited options for customizing the payment experience, which can make it challenging for businesses with specific branding needs.
- Customer service: Some users have reported poor customer service experiences with PayPal, which can be frustrating if issues arise with transactions or account management.
- Limited integration: PayPal may not integrate with certain e-commerce platforms or software, which can limit the options for businesses that need more specialized payment processing solutions.
Square is a financial and merchant services company that provides a range of payment and point-of-sale solutions to businesses of all sizes. The company was founded in 2009 by Jack Dorsey, who also co-founded Twitter. Square’s core product is a credit card reader that plugs into a smartphone or tablet, allowing businesses to accept payments on the go. In addition to this, Square offers a suite of software and hardware tools for managing inventory, tracking sales, and analyzing business performance. Square is popular with small and medium-sized businesses due to its ease of use, low fees, and accessibility.
Square is a payment gateway that allows businesses to accept online payments through its platform. It has become a popular choice for small and medium-sized businesses due to its ease of use and competitive pricing.
Pros of using Square:
- Easy setup and use: Square has a user-friendly interface and easy setup process that requires no technical knowledge.
- Affordable pricing: Square offers competitive pricing with no monthly fees or setup fees, and only charges a small fee for each transaction.
- Multiple payment options: Square allows businesses to accept various payment options, including credit cards, debit cards, and mobile payments.
- Built-in security: Square offers built-in security features, including fraud detection and data encryption.
- Integration with other tools: Square integrates with other business tools, such as accounting software and inventory management systems, making it a more comprehensive solution for businesses.
Cons of using Square:
- Limited features: While Square offers a range of features, it may not be as robust as other payment gateways in terms of customization options and advanced features.
- Hold times for funds: Square may hold funds for a period of time to ensure there are no issues with the transaction, which could be a drawback for businesses that require immediate access to funds.
- Customer support: Some users have reported issues with customer support, particularly with regards to account freezes or holds.
Overall, Square can be a good option for small and medium-sized businesses that require an easy-to-use, affordable payment gateway with built-in security and integration options.
Stripe is an online payment processing company that provides a platform for businesses of all sizes to accept payments over the internet. It offers a suite of APIs and tools that enable businesses to accept and manage online payments, including credit and debit card payments, subscription billing, and mobile payments.
Pros of using Stripe:
- Easy to use: Stripe’s API is easy to integrate into websites and apps, making it simple for businesses to start accepting payments quickly.
- Wide range of payment options: Stripe allows businesses to accept payments from all major credit cards, as well as digital wallets like Apple Pay and Google Pay.
- Security: Stripe is Level 1 PCI compliant, which is the highest level of security certification in the payments industry. This means that customer data is protected with the most up-to-date encryption and security standards.
- Transparent pricing: Stripe charges a flat fee per transaction, which makes it easy for businesses to understand and manage their payment processing costs.
Cons of using Stripe:
- Limited phone support: Stripe primarily offers support via email, chat, and self-help resources, which can be a challenge for some businesses.
- Chargeback fees: Like most payment gateways, Stripe charges fees for chargebacks, which can be costly for businesses that experience frequent disputes.
- Payout delays: Stripe holds funds for up to seven days for new accounts, which can be a challenge for businesses that need immediate access to their funds.
Other Payment Gateways
There are several Canadian payment gateways available for online payment processing, including:
- Moneris Solutions: A joint venture between BMO Bank of Montreal and Royal Bank of Canada, Moneris offers a range of payment solutions for businesses of all sizes.
- Payfirma: Payfirma offers a range of payment processing solutions, including online payments, mobile payments, and in-store payments.
- Authorize.net: Although based in the United States, Authorize.net is widely used in Canada and offers a range of payment solutions for businesses of all sizes.
- Chase Paymentech: A subsidiary of JPMorgan Chase, Chase Paymentech offers a variety of payment processing solutions, including credit and debit card processing, mobile payments, and eCheck processing.
- Bambora: A payment processing company that offers payment solutions for online, mobile, and in-store transactions. The company provides payment processing services to merchants of all sizes, including small and medium-sized businesses. Bambora offers a variety of payment solutions, including credit and debit card processing, digital wallets, and bank transfers. The company is headquartered in Sweden, but also has offices in North America, Europe, and Australia. Bambora was acquired by Worldline in 2020.
- Global Payments: A payment processing company that offers services such as credit and debit card processing, check processing, and electronic funds transfers. They provide payment solutions for various industries including healthcare, retail, hospitality, and e-commerce. Global Payments operates in over 30 countries and processes millions of transactions daily. They offer a range of payment processing options including point-of-sale terminals, online payment gateways, and mobile payment solutions.