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Your Ultimate Payment Gateway Comparison Guide

The Huffington Post The Huffington Post 26/02/2016 Allen Burt

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Did you know that 50% of online shoppers would cancel their purchase if their preferred method of payment wasn't available? (source)
Since the checkout can make or break your customer's ecommerce experience, it's important to choose the best payment gateway possible for your store and your checkout UX.
To be sure you're making the right gateway choice, ask yourself these 3 questions:
1) How does this gateway enhance my checkout user experience (UX)?
Believe it or not, your payment gateway choice can actually improve your checkout process by eliminating some steps and speeding up the process. If you choose to integrate PayPal Express of Amazon Payments, you can auto-populate some of your customer's information through the gateway's API, making it closer to a one-click checkout.
And since the checkout is what determines if the sale actually goes through or not, making it seamless and easy is key. Making the checkout easy and painless makes customers not only more likely to buy, but more likely to return. And, increasing your customer retention rates by just 5% can increases profits up to 95%! (Bain & Co)
2) Does this gateway integrate with my current platform?
Even though it's possible to integrate a payment gateway that doesn't have an existing plugin or application for your platform, you're going to have to go to extreme levels of custom development to make it work. This will cost time and money that could probably be better spent elsewhere.
Also, when you highly customize something in your checkout it becomes quite difficult to streamline across all channels. For example, if your development team crafts a connection between Amazon Payments and your Solidus store, ensuring that this checkout performs seamlessly across all devices is going to require a lot more dev work and resources versus an already-built solution which has been tested.
Most payment gateways integrate with most newer platforms, so if your gateway of choice doesn't integrate with your current platform it may be time to ask yourself if your platform is outdated.
3) How does this gateway promise to grow with my business?
As your business grows, your gateway needs to be able to keep up. Say your target demographic begins to show high engagement level on Twitter. Wouldn't it be perfect if they could shop your products without ever leaving Twitter?
One of my favorite payment solutions, Stripe, has just launched a product that will do just that. Relay allows customers to shop directly from a tweet, with no annoying redirects.
This is a true example of innovation from a payment gateway. Brands that have chosen Stripe and similar platforms that consistently launch innovative products can feel confident about their growth and future success of reaching their customers.

Choosing a Gateway
Once you understand these questions and how they'll help you choose the best gateway, it's time to look at the solutions themselves. Let's take a look at 7 of the most widely-used solutions:

BraintreeBraintree has become a competitive payment gateway since its launch in 2010. Eventually getting acquired by PayPal, Braintree now operates as a "PayPal Company" and could be one of the most progressive movers in the payment industry. They accept payments from PayPal, Apple Pay, Android Pay, Venmo, and even Coinbase (bitcoin)! And, of course, they process traditional online payments as well.
Supported Platforms: Bigcommerce, Magento, Spree Commerce, WooCommerce, Shopify, and more.
Processing Rates: Braintree charges a 2.9%+ $0.30 transaction fee (after first $50,000), and a $15 chargeback fee. You can see all pricing details here.
Contract: There are no contract requirements with Braintree, and you get to take all of your customer data with you for free!
Notable Clients: Bonobos, Airbnb, Uber, and Casper.

StripeStripe began with a simple purpose: make it simple for businesses to do business online. They have a bit of a different appeal in that they build for developers, not merchants. This is an interesting approach for the company and shows their true vision is in the future.
By listening to and working with developers first, the company can be on the forefront of building progressive payment solutions. If it is important for your company to be on top of capturing sales in a "non-traditional way" (through a third-party app, via marketplace, through subscriptions), then Stripe could be the right solution for you.
Supported Platforms: Bigcommerce, Shopify, WooCommerce, Magento, Spree Commerce, and more.
Processing Rates: Stripe charges a 2.9% + $0.30 fee (after first $1 million), and a $15 chargeback fee. You can see all pricing details here.
Contract: There are no contract requirements, but you must have to agree to the Terms of Service & Privacy Policy.
Notable Clients: Harry's, Fitbit, Task Rabbit, Lyft, and more.
Stripe also recently launched Atlas, which looks to break the geographical barriers of starting a business for global entrepreneurs. This could be a game-changer for the startup community. You can read more about Atlas here.

Authorize.NetAuthorize.Net has been in the payment processing space for a while - since 1996. Because of its seniority in the space, this provider has maintained a decent portion of the payment gateway market share. Like the above-mentioned gateways, Authorize.Net provides similar fraud protection services, subscription capabilities, and simple checkout options.
The downside is that if you need to transfer your data, you cannot do it as seamlessly as Braintree's free migration service. If you want to eventually leave Authorize.Net you will have to redo the entire process of collecting payment information from your clients for recurring billing and payment method. Not fun for you or for customers. On the bright side, Authorize.Net has a friendly interface and allows you to get fairly granular with your security settings so this is a nice plus for your development team.
Supported Platforms: Bigcommerce, Shopify, Volusion, WordPress, Magento, and more.
Processing Rates: Authorize.Net charges a $49 setup fee, a $25 monthly gateway fee, and a $25 chargeback fee. The transaction fee is 2.9% + $0.30.
Contract: Authorize.Net has a month-to-month option with no early termination fees, but if you choose to go through a reseller, you may encounter a contract and termination fees. Here is a detailed list of the "fine print" of their services agreement.

PayPal
The name "PayPal" is synonymous with online payments because they spearheaded the movement back in the late 90s - and they're still going strong today. As mentioned above, they've acquired Braintree and now have that and Venmo under their belt. PayPal has also since separated from eBay, so they are one powerful and progressive entity on their own.
PayPal is a great alternative or "back up" solution to any other gateway solution you may have on your site. You can, of course, use it as your sole solution, but many brands have it as an alternative choice at checkout. Why? It's a time saver and an alternative to people who do not wish to dole out their credit card info to every retailer they are purchasing from.
With over 165 million users it's definitely a trusted platform, and chances are a good portion of your demographic has a PayPal account. This could be a good "backup" gateway for you to implement and do some A/B testing on your checkout experience. It could be the difference in making or losing a sale.
Supported Platforms: ALL. Since PayPal usually redirects to its own site, no platform integration is necessary. If you want to integrate with PayPal Express, the redirect is skipped entirely and the necessary information is provided by the Express API.
Processing Rates: PayPal charges 2.9% + $0.30 per transaction (with option for volume discounts), and a 3.9% + fixed fee per international transaction. Additional add-ons may require other fees. and you can see all the pricing details here.
Contract: Paypal does not have a contract obligation and you can cancel at any time. You do have to comply with the PayPal user agreement which you can read in full here.
Notable Clients: You can see an exhaustive list of PayPal's store directory here.

Amazon PaymentsAmazon Payments launched in 2007 with the goal of providing users the same checkout experience they recieve from Amazon.com on other sites. Like PayPal, your customers' transaction(s) can be conducted through Amazon Payments without leaving your website (conducted "inline").
A plus about Amazon Payments is that your customers can have access to their 1-click shipping options, which is a feature of the Amazon.com checkout that highly increases conversions. (source) If your customer base shops on Amazon, introducing this feature could greatly speed up your checkout process and, therefore, increase conversions.
Supported Platforms: Magento, Shopify, WooCommerce, Volusion, and more.
Processing Rat es: Amazon charges 2.9% + $0.30 per transaction and a $20 chargeback fee. There are no setup fees, and no fraud protection fees. You can see all the pricing details here.

Contracts:
Amazon Payments does not operate on a contract and you can cancel your account anytime. Read more about cancellation here.
Notable Clients: Patagonia, Jockey, Honest.Co, Blick, and more.

Orbital Payment Gateway by Chase Paymentech
Chase is quite a big name to be moving in the payment gateway space. Naturally, it comes with pros and cons. One of the pros of choosing Orbital Gateway as your solution is that you may be able to get a much lower processing rate than offered by any company listed here (more on that below).
The main con stems from dealing with such a large entity. When companies are this large, they have problems maintaining customer service and providing a high quality product. Don't expect the level of customer service from Chase that you'd get from PayPal. So, the processing rate is attractive, but it comes at a cost. Additionally, reviews of this gateway show that Orbital is very good at tailoring their pricing to the business versus a flat-rate for all types. If you are looking to lower your cost on processing rates, Orbital may be the right solution for you.
This solution has, however, racked up a lot of negative reviews.
Supported Platforms: Magento, Shopify, and WooCommerce
Processing Rates: Chase charges a $9.95 monthly fee, plus 1.65% + $.25 per transaction with your existing equipment. See all pricing details here.
Contract: Orbital Gateway has now moved away from a contract agreement (though if you purchase through a reseller you may still encounter this) and is now on a monthly model. However, if you sign up to receive equipment from Orbital, you will probably encounter a 24-month service agreement. (source)

World Pay
Another one of the original online payment providers, WorldPay started processing online payments in 1994. They are a global solution and have over 150,000 clients in the U.S. alone. However, because they are such a large company their customer service suffers.
Additionally, there may be some cancellation fees depending on what your WorldPay rep sets you up with in the beginning (more on that below). WorldPay is attractive in its lower rates, but it seems to be laced with fees and charges. Like Orbital, if you are looking for a lower processing rate, this gateway could be the right solution for you - but it's going to come with a tradeoff.
Overall, this solution seems outdated in both interface and pricing model. Our advice would be to read as many reviews as possible before using this solution.
Supported Platforms: BigCommerce, Magento, Spree Commerce, Shopify, and WooCommerce.
Processing Rates: All of the below fees are on a "Limited Offer". WorldPay also charges a PCI compliance fee and chargeback fees.

  • Signature debit transactions at 0.99%
  • Standard credit transactions at 1.99%
  • Rewards credit transactions at 2.6%
  • Corporate/T&E/Keyed-In credit transactions at 3.30%
  • $0.20 per-transaction fee
Contract: With WorldPay, you have a contract of 3 years. Should you choose to cancel early, your fees can be anywhere from $95 - $295. You can read more about their contracts and cancellation fees here, and also take a look at the actual Terms & Conditions on their site.

Conclusion
In researching for this article I came across a very useful resource from Spreedly: their Gateway Index. It provides an overview of even more gateway choices, and allows you to get a bit more insight into the usage and popularity of the solution.
Even though this article and Spreedly's Gateway Index provide a pretty thorough outline of the payment options out there, it is crucial that you make the correct choice in your payment gateway. If made incorrectly, it could come with some serious backlash for your business and conversion rates. Do your due diligence, and you'll have a high converting checkout your customers love in no time.

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