Got E-commerce? How To Accept Payments

by Shonali Burke on July 12, 2010

You’ve got your ecommerce website almost ready to go selling software, jewelry, or whatever it is you’re passionate about.

There’s just one thing standing in the way between you and the customers out there eagerly awaiting your launch: a way to accept payments.

Image: Quazie, Creative Commons

Unfortunately, accepting payments can be an arduous and confusing process but I’ll try to elucidate the topic by breaking it down through a series of articles here on Women Grow Business.

This month I’ll give a quick overview of the different pieces needed to accept payments, and each month after, I’ll go into much more detail about each piece.

What you need to get started:

A credit card processor.

A merchant account provider (aka a credit card processor) is responsible for processing your credit card transactions. To sign up, you’ll need to set up a merchant account through your provider.

Be wary when it comes to processors, as they have a reputation for being sketchy and ripping off business owners. When negotiating terms, make sure to ask for interchange plus pricing, the most transparent form of pricing for business owners.

A gateway.

A gateway connects your customer to your processor. Think of it like a virtual terminal comparable to the little gray machine where cards are physically swiped in brick and mortar shops.

The most popular gateway out there is Authorize.net, although there are a lot of other options depending in your needs.

What about PayPal?

Definitely an option for ecommerce businesses starting out, PayPal acts both as a processor and a gateway. There are many versions of PayPal, so make sure to read the details and get the one right for your stage of business.

For example, paying extra to make sure users don’t go offsite to pay can help your conversion rate. When using PayPal, there comes a point when getting a gateway and processor becomes much cheaper (higher volume). Use this nifty PayPal Upgrade Calculator to figure out if it’s the right time to switch.

More to come in future posts; in the meantime, if you have questions, please let me know!

More from:

Stella Fayman blogs about credit card processing at the TransFS Blog. TransFS.com is the comparison shopping site for credit card processors; just like getting multiple quotes for airfare using Expedia, TransFS lets business owners compare top quality processors on an apples-to-apples basis and makes sure they get the best deal by not having any cancellation or hidden fees, and only interchange plus pricing. Contact Stella with specific questions at stella@transfs.com or connect with her on Twitter.

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