Payment Systems for EcommercePosted on
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Millions of consumers use the Internet for banking, shopping and so forth on an everyday basis and are reliant for their security on ecommerce payment systems. An e-commerce payment system is a secure online payment system, operated by a High Street bank or a specialist company and often, although not always, integrated into the checkout process of a site. The aim of an ecommerce payment system is to provide transactions that are not only secure – in real and perceived, terms – but fast and at minimal cost to the consumer. There are several different methods of achieving this aim and costs vary, so it is worthwhile to examine some of the options available.
Bank and Credit Card Payment Systems
Many large online businesses use the payment systems offered by major credit card operators, such as Visa and MasterCard. Cardholders create and register a password with their bank and use that password to authenticate each online transaction that they perform. If you have a merchant account with a bank, it may also be possible to collect credit card details online, but to process transactions manually – as “customer not present” – depending on the terms and conditions of your agreement.
PROTX (now Sage Pay)
Another alternative is to integrate your online checkout process with an e-commerce payment system provided by a bank, for which you will be required to pay a monthly fee, plus a percentage of each transaction. Protx which has just been rebranded as Sage Pay) for example, provides a payment gateway which integrates with bank systems for a fixed monthly charge, provided that you have a merchant account with one of its bank partners. Sage Pay “Go” costs £20 for up to 1000 transactions per quarter and from 10p per transaction if you regularly processing over 1000 transactions per month.
If you want to accept online payments directly through your own website, you will need what is known as an Internet merchant account. This can be handled indirectly, through a service such as the SecureTrading Merchant Account Service. This can also arrange merchant accounts for mail order or telephone ordering if need be – or directly at a bank. Charges for merchant accounts vary from bank to bank, and according to the type and age of your business, together with other trading factors such as turnover.
If you feel that you do not need, or do not want a merchant account with a bank, PayPal may provide a simpler option. You can create a PayPal account very quickly, and there are no set up or cancellation fees. Importantly, you are not bound by a minimum number or value of transactions each month. You can simply cut and paste the HTML code supplied by PayPal for the creation of a payment button into your online checkout for single item transactions. Alternatively you can choose one of the many shopping carts already integrated with PayPal for multiple items. Transaction fees range from 1.4% to 3.4%.
Other ecommerce systems that you wish to consider include Google Checkout, which allows online shoppers to make purchases from anywhere on the Internet, but provides tracking and delivery information in a single location. Merchant fees range from 1.4% + £0.20 through to 3.4% + £0.20 per transaction depending on sales volumes, with additional costs for international transactions.
WorldPay is backed by the Royal Bank of Scotland, the fifth biggest bank in the world. It – which allows secure payment not only by credit, or debit, card, but by what the firm claims is the widest range of payment means currently available.
All of the major ecommerce payment systems providers are rated by the PCI Security Standards Council which is a global forum concerned with security standards for account data protection. The Council has a stringent set of Data Security Standards (PCI DSS) to which payment providers are encouraged to adhere.