Online payment providers - what do you need to know?

4-minute read

Thurs June 19 2018

If you’re working out how to start selling online, or you already run an eCommerce site for yourself or on behalf of a business owner, read on.

Below are some of the main things you need to know about online payment providers, from why you need one, to some key differences between them. At the end you’ll find a list of eight things to look for when choosing an online payment provider or switching providers.

Why you might need an online payment provider

For any site that’s transactional, you’ll need an online payment provider so you can take credit, debit and digital wallet payments from customers. Not only do online payment providers allow you to take card payments online (as the term suggests) but some also offer protection from fraud, the ability to grow with your business and much more. That’s why it’s important to pick the right one for your business as it is now, but also for how you think it could be in the future. In other words, consider business plans and growth when you choose a provider.

In simple terms, online payment providers offer payment gateways. This is basically a secure courier that sends payment information securely from the acquirer to the customer’s issuing bank, and back again. No matter how or where you take card payments, you’ll need a payment gateway of some description. For bricks and mortar businesses, these will be card readers (also known as card terminals and card machines). For eCommerce sites, they’ll be online payment gateways, supplied by online payment providers like Barclaycard.

An online payment provider is your link between the customer and your business bank account. This is how an online payment works and where an online payment provider comes in:

The role of online payment providers in the customer journey

Picking the right provider isn’t just about what’s right for your business in terms of integration, support, fraud etc., it’s also about what’s right for your online shoppers. Your online checkout page process can be the difference between someone completing the purchase or abandoning their basket.

According to Barclaycard research, retailers could be missing out on £18bn because of online basket abandonment.  41% of online shoppers abandoned a purchase in the last year, compared to 24% of people who walked away from an in-store purchase¹.

The right payment gateway from a trusted online payment provider can help businesses cut their losses from basket abandonment.

The difference between online payment providers

All online payment providers offer the same basic service – they allow businesses to take payments online. But that’s where the similarity ends. It’s well worth doing your research into the different providers; with everything from what payment types they accept, to reporting, support, price, fraud protection and more. See below for eight key things to look out for when choosing a provider.

Did you know that Barclaycard processes nearly half of all card payments in the UK? And that in 2017, we processed over £250bn in transactions, globally?

Eight things to look for when choosing your payment provider

1.       Payment types

Does your online payment provider allow you to accept all major credit, debit and digital payments from customers at home and abroad?

2.       Security measures

Does your provider offer industry-leading fraud protection tools that automatically detect fraudulent payments (i.e. someone trying to pay using a card that’s stolen)? And ensure you’re PCI DSS compliant, have access to 3D Secure and benefit from tokenisation as standard?

3.       Technical support

What level of support do you get when you’re integrating the online payment gateway with your eCommerce platform? And if something goes wrong? Make sure you get answers to these questions before you sign up or switch.

4.       Data and reporting

The right online payment provider should offer you insights, payments data and reporting to help you see how your online business is doing and help you manage cash flow. With this information you can make changes to your online business that could help you improve your customer journey and conversion rate.

5.       Compatibility and business growth

Not all online payment providers offer solutions that integrate the most popular eCommerce platforms and shopping carts, so it’s important to understand what will work for your business. It’s worth bearing in mind that you might change your eCommerce platform or expand internationally as your business gets bigger, so make sure you pick the right payment provider that can grow with you.

6.       Consumer trust

Does the online payment provider you’re considering have a brand that’s recognised and trusted by consumers? This can make a big difference to conversion rates. If an online shopper has doubts about the authenticity of your site, they might decide to buy elsewhere. Having a payment page that’s branded with a trusted logo like Barclaycard’s can help people see that your website is genuine and their money and card details are safe.

7.       Price

Price is an important consideration for all businesses. Because online payment providers vary so dramatically in terms of what they offer, check out which of the above six points are included in the price you pay, and which are considered ‘add-ons’ or extras.

8.       Support to build a payment strategy

Taking payments is one thing. But what about when your business grows and you want to take international payments, for example? Or when the payment landscape shifts and you need to accept the latest form of payment? Make sure your online payment provider has a consultative, partnership approach to helping you make the big payment, technology and business decisions that’ll work with your business at it evolves.

Barclaycard is a trusted online payment provider for businesses big and small. Have a look at some payment gateway case studies here, where you can also read about the benefits of Barclaycard Smartpay, our range of payment gateways.