It pays to pick the right payment options

You haven’t made a sale until you have the money in your account. Making it easy for your customers to pay online not only improves your cash flow but helps your increase sales.

There are a number of misconceptions about payment options, this article will provide you with an overview of the two most popular payment options used by ezimerchant customers and their associated costs.

PayPal

PayPal was the first true online payment solution, owned by eBay PayPal has grown a large Australian customer base. Merchant's customers have the option to either pay using their PayPal account or credit card.

PayPal is an ideal solution when you are starting out in business as their are not fixed monthly fees.  It is also a convenient option if you do not yet qualify for an internet merchant account with your bank. 

The multi-currency service is great when selling overseas and you want your customers to pay in their local currency.

Even if you already have online credit card facilities with your bank it is worth adding PayPal as an alternative payment option. Reports* show that most merchants gain incremental sales after adding PayPal to their website.

PayPal pricing

Standard PayPal services for domestic transactions are based on transaction volume and range from 2.4% + 30 cents per transaction down to 1.1%  30 cents per transaction. There are no monthly or setup fees, for more information visit PayPal.

Credit Card

Credit cards account for the majority of online sales. Behind each transaction is  a complex network of intermediaries allowing transactions to be transmitted safely put the money into your bank account.

As the owner of an ecommerce business there are two main components of the payment network you have to deal with, the credit card gateway (provided by ezimerchant) and an internet merchant facility (provided by your bank).

Gateway

The credit card gateway encrypts your customers credit card information and transmits it across the payment network, then returns if the payment has been accepted or rejected. The ezimerchant platform has gateway facilities integrated make it simple and easy to setup your credit card facility.

Merchant facilities

To process credit cards you need an internet merchant facility with your bank, this does differ from your EFTPOS and offline credit card facility. Our experience has found that you should allow 4-6 weeks to setup online facility with your bank.

Costs of process credit cards online

Credit card gateway have 3 sets of costs associated with the facility, a setup fee, a monthly fee (this is covered within your monthly fee) and a per transaction charge.

Internet merchant facilities usually have a setup fee, a monthly fee and a per transaction fee hat consists of a fixed and variable component based on the total value of the transaction.

Payment options as your business grows

Most new websites will use PayPal as their sole payment solution, as their business grows   they then add a direct credit card facility. Top merchants know there is value in retaining their PayPal option as they see the value in this payment option.

Setting up the right payment options can help increase your sales and see money in your bank account faster.

* IPSOS - “Eight in Ten (83%) PayPal Merchants Say Sales Have Increased Since Offering Popular Payment Method” March 2011