How to choose an online payment system

How to choose an online payment system

Category: Payments

When you’re setting up your own ecommerce website one of the most important decisions you’ll make is which online payment system you use. We previously covered the different online payment systems that you can choose from here, and now we’ve taken a look at what things you need to consider before choosing an online payment system.


One of the most important factors will be the cost of your online payment system. The price varies between systems and can include set up costs, monthly fees, a fixed fees per transaction or variable fees based on a percentage of each transaction.

You’ll need to spend some time calculating how many transactions and how much money you’re hoping to take and work out which kind of price structure will work best for you. For example, if you’re just starting out and have a low volume of sales, a payment per transaction may work out better so that you’re only paying when someone makes a purchase and you don’t have a monthly bill to pay regardless of how many payments you’ve processed. As a larger company, a fixed monthly fee may work out cheaper than paying for each transaction. Systems that charge a monthly fee and a charge per transaction are also more suitable for larger businesses.

On top of the basic cost of using each system, some will also charge extra for things such as chargebacks (when the customer complains to their bank about a fraudulent charge and the bank reverses the payment) and payments from international cards.

While some payment systems might appear to be good value, you need to consider whether you’re going to be doing a lot of international transactions or your business is likely to grow rapidly and be affected by increasing fees as you expand.

Contract length

You need to be aware of the commitment you’re making to a particular payment system, especially if you think your requirements for a system are going to change quickly. Some systems will offer monthly rolling contracts, with others you’ll have to commit to for up to two years.

Usability for shoppers

Fully test out the payment system that you’re planning to use before you make a commitment to it. You should consider how many steps a customer has to take between when they decide they want to pay and when their payment is actually taken - if the process is too long or too complicated then shoppers are likely to abandon their shopping and go somewhere else. How well it works on mobile devices, and whether it’s secure are also important considerations.

Feedback and reviews

Your ecommerce website will be completely reliant on your payment system so you need to take some time to research and compare services. A low price will end up costing you more money if it frequently has issues and outages. Take a look into how often they’re experiencing technical issues and any other problems, and also be aware of any reports of users’ accounts being blocked or closed unexpectedly. Most major online payment systems are reviewed on Merchant Maverick.

You should also look into what customer support the payment system offers. As an online business you’ll be taking payments at all times of the day, and if you have any issues you need to be sure that you can get in touch with someone who can help as soon as possible.

Recurring payments

If your business offers monthly subscriptions then you need to make sure that the online payment system you’re choosing has the functionality to take a monthly recurring payment.

Multiple payment systems

Having more than one payment system gives your customers more choice and increases the likelihood that you have a payment option that they’re happy to use. PayPal can be a popular alternative to card payments because users can log in instead of having to enter their entire card details. A well known brand payment system will also give buyers more confidence that they can trust your website. It’s also a good idea to have more than one payment option so that you have backup when there’s an issue with one.

Summary: Choosing an online payment system

The most important thing to do when you’re choosing the online payment system for your ecommerce website is to properly research the different options to find something suitable for your business. It’s essential that you fully understand what you’re agreeing to when you sign up and whether it will still be suitable as your business grows or if you can easily switch to another system.

Find out more about different online payment systems here.

Get tutorials and news in your inbox every two weeks

Share this