Payent gateway? which is best?
- 174
- 1361
- 4/14/2011
- Ukraine
When selecting a payment gateway, you should not only check the payment gateway (the software) itself, but also the credit card processor company's conditions, like pporabik says.
These payment processors and our banks are more-and-more playing the roles of an evil bureau that we are trying to please constantly.
I mean that beyond the obvious conditions (commissions) there many more things to consider, and these are hidden at first sight.
Just a few that come to my mind.
Most of these payment processors have very strict and illogical policy rules, some have huge lists of forbidden items and activities (you might think of drugs, weapons and similar, no, not just these, but many innocent-looking things you would never consider to be forbidden, e.g PayPal processor Braintree for example has a 59-item list including cruise lines, tour operators, flea markets sales, pharmacies, fake hair or hair extensions, etc. as forbidden activities) We had a customer who sells beauty and personal care items (e.g. nail gels) her application for a merchant account was declined because of she sells 'high-risk items'.
There is also a great difference how they process different currencies, some companies require you to apply for new account for each currency you wish to accept payment in. And each account costs you an additional fee.
Some have very strict rules on chargebacks, each time your customers ask for a refund, it is a bad point, and if these reach a certain threshold (there's not a clear number published), the payment processor can close your account, and you are not getting your money even from the other sales for a long time in such a case. We have met some horror stories already.
It is even a greater trouble if any of your customer ever uses a stolen card number, if such a thing ever happens, they can close your account very fast. According to their rules it is your responsibility to decline all suspicious sales.
There is also a difference how fast a payment processor approves your account. They check both your company, and your website. Some processors pre-approve you, so you can begin selling immediately, but after 10-20 sales they do a real background check, and if they find something they don't like, you're in trouble.
The great difference among the processors is the ATTITUDE how they handle the above cases, they can be very narrow-minded and rude, we've met a case when the shop-owner made three sales with his own card to test his shop, he of course refunded these sales to himself, then he sold only five items for real customers in the first month of operation, and his application was declined after this first month because of the 'high rate of refunds' (ie. 8 sales resulting 3 refunds). Ridiculous. His account access was closed immediately, there was nowhere even for him to complain.
The user interface where you handle your merchant account is also very different, some processors webpage is a mess.
Another great difference is how they require you to be PCI DSS compliant to accept credit cards. There are four levels of PCI compliance. If they classify your company and activity anything beyond level A, you are screwed. All other levels are not feasible for a small company.
I suggest to check some independent reviews. for example here https://www.merchantmaverick.com/review-category/merchant-accounts/ and similar sites.
Read the user comments also in the bottom.
These payment processors and our banks are more-and-more playing the roles of an evil bureau that we are trying to please constantly.
I mean that beyond the obvious conditions (commissions) there many more things to consider, and these are hidden at first sight.
Just a few that come to my mind.
Most of these payment processors have very strict and illogical policy rules, some have huge lists of forbidden items and activities (you might think of drugs, weapons and similar, no, not just these, but many innocent-looking things you would never consider to be forbidden, e.g PayPal processor Braintree for example has a 59-item list including cruise lines, tour operators, flea markets sales, pharmacies, fake hair or hair extensions, etc. as forbidden activities) We had a customer who sells beauty and personal care items (e.g. nail gels) her application for a merchant account was declined because of she sells 'high-risk items'.
There is also a great difference how they process different currencies, some companies require you to apply for new account for each currency you wish to accept payment in. And each account costs you an additional fee.
Some have very strict rules on chargebacks, each time your customers ask for a refund, it is a bad point, and if these reach a certain threshold (there's not a clear number published), the payment processor can close your account, and you are not getting your money even from the other sales for a long time in such a case. We have met some horror stories already.
It is even a greater trouble if any of your customer ever uses a stolen card number, if such a thing ever happens, they can close your account very fast. According to their rules it is your responsibility to decline all suspicious sales.
There is also a difference how fast a payment processor approves your account. They check both your company, and your website. Some processors pre-approve you, so you can begin selling immediately, but after 10-20 sales they do a real background check, and if they find something they don't like, you're in trouble.
The great difference among the processors is the ATTITUDE how they handle the above cases, they can be very narrow-minded and rude, we've met a case when the shop-owner made three sales with his own card to test his shop, he of course refunded these sales to himself, then he sold only five items for real customers in the first month of operation, and his application was declined after this first month because of the 'high rate of refunds' (ie. 8 sales resulting 3 refunds). Ridiculous. His account access was closed immediately, there was nowhere even for him to complain.
The user interface where you handle your merchant account is also very different, some processors webpage is a mess.
Another great difference is how they require you to be PCI DSS compliant to accept credit cards. There are four levels of PCI compliance. If they classify your company and activity anything beyond level A, you are screwed. All other levels are not feasible for a small company.
I suggest to check some independent reviews. for example here https://www.merchantmaverick.com/review-category/merchant-accounts/ and similar sites.
Read the user comments also in the bottom.
MVP
Silver Solution Partner
- 5236
- 49485
- 10/4/2010
- Mexico
libor wrote:
Quite a good list of considerations. Here are some more to consider:
- The country where you want to taky the payments. Some processors are good for some countries and other for other countries.
- Filters and insurances to protect the merchant against frauds.
- Sometime filters such as 3D Secure are too strict and discourage sales, thus can also be counterproductive.
- Other payment options that they offer besides credit/debit cards. For instance in Latin America they offer options such as:
-- Differed payments (3 monts, 6 months, etc.) with credit card with/without financial charges to the card holder.
-- Deposits/transfers to various bankn accounts (of the processor)
-- Deposits in department and/or convenience stores
When selecting a payment gateway, you should not only check the payment gateway (the software) itself, but also the credit card processor company's conditions, like pporabik says.
These payment processors and our banks are more-and-more playing the roles of an evil bureau that we are trying to please constantly.
I mean that beyond the obvious conditions (commissions) there many more things to consider, and these are hidden at first sight.
Just a few that come to my mind...
These payment processors and our banks are more-and-more playing the roles of an evil bureau that we are trying to please constantly.
I mean that beyond the obvious conditions (commissions) there many more things to consider, and these are hidden at first sight.
Just a few that come to my mind...
Quite a good list of considerations. Here are some more to consider:
- The country where you want to taky the payments. Some processors are good for some countries and other for other countries.
- Filters and insurances to protect the merchant against frauds.
- Sometime filters such as 3D Secure are too strict and discourage sales, thus can also be counterproductive.
- Other payment options that they offer besides credit/debit cards. For instance in Latin America they offer options such as:
-- Differed payments (3 monts, 6 months, etc.) with credit card with/without financial charges to the card holder.
-- Deposits/transfers to various bankn accounts (of the processor)
-- Deposits in department and/or convenience stores