When you set up an ecommerce shop, your mind is on products, sales and marketing; few business owners consider payment gateways. But these are essential ingredients of a slick online shop, so a spare a thought.
By Andy Macauley, Chief Operating Officer, Handepay
The UK is one of the world’s most developed markets for e-commerce, with customers adding more items to their e-retail baskets per shop than ever. Large high street brands even refer to their website as another one of their ‘stores’ as demand for online shopping continues to grow.
This is never truer than in the run-up to Christmas, with savvy online retailers experiencing levels of year on year growth that high street stores would kill for.
For small businesses, online provides a platform to sell while keeping overheads, such as a physical shop with rent and heating costs etc, to a minimum.
Taking advantage of the huge growth in online retail by setting up your own e-commerce site is an exciting and potentially profitable move. There are many things to consider when building your site, making it user-friendly for customers is vital to its success and how you enable them to pay is an essential part of this.
Anyone selling online needs an internet merchant account to process payments. To sell online, you’ll need an internet merchant account to authorise, process and settle payments from your customers.
You’ll also need a payment gateway. Think of this as a terminal for the internet. It’s a secure site that is linked to your e-commerce store where consumers can safely enter their card details. The payment is then submitted for authorisation, just like a terminal, and customers receive an electronic receipt.
This reduces security worries as you are not capturing customer card details directly on your website. Off the shelf payment gateways will come already integrated with a wide range of the most popular shopping carts and are a great solution for all sizes of e-commerce businesses as they accept accept all major cards and PayPal.
By taking the card details away from your site and on to the gateway, you are also making your business compliant with the Payment Card Industry Data Security Standard.
This is a mandated requirement by the payment schemes (Visa, MasterCard) that every business that accepts, transmits or stores cardholder data MUST comply with. It’s about the secure storage and processing of important cardholder data to protect against fraud and other financial crime.
There are many providers of these gateways, but you need to be sure the one you choose is “approved” by your acquirer – the organisation who actually process the payment. They normally charge a monthly fee for a “bundle” of transactions or a certain amount (usually a few pence) per transaction.
Many offer a back office system, which lets you see detailed reports of the transactions that have been processed and do other functions such as sending refunds.
If you’re just starting your e-commerce business, you might want to consider making your site mobile optimised– there are many companies that can do this for you when you set up.
What you will be charged for each transaction will either be a percentage of the transaction or so many pence per transaction – that can be negotiated with the company you enter into the agreement with and depends on whether most of your transactions are of a high or low value.
Your customers want to pay by card and there are solutions out there for every type of business. So there’s nothing holding you back from getting started – you’ll never look back.
Handepay’s guide ‘so you’re thinking about taking card payments’ is available to download for free at www.handepay.co.uk/accepting-card-payments
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