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magento & ecommerce

Choosing the best payment gateway for your Magento store

Your payment gateway processes and transfers money from your customer’s account to your account. It’s a crucial part of any Magento stores.

Unless a gateway performs as it’s supposed to, customers are not likely to return. A bad gateway creates even more transactional problems for you, not to mention any reputational damage. A good one must meet your needs in terms of capabilities, fees, security, and convenience.

But there is more to choosing the best payment gateway than meets the eye. This write-up provides you with tips on how to make the selection. And there are also a few recommendations for gateways that are worth your attention.

What you need to consider

The most popular payment methods worldwide are credit cards, e-payment services (PayPal and others), debit cards, and direct bank transfers. In the United States, it’s mostly credit cards, and payment gateways lump Visa and Mastercard debit cards in with credit cards, at least as far as the interface is concerned.

But if you plan on expanding your international presence, your store might need to accommodate more payment methods.

Magento store edition

The edition/type of your Magento store is one of the things that affect your gateway choice. Magento Commerce and Magento Open Source offer different functionality and features.

The Commerce platform is a premium product which requires more investment at the start. But you might find it easier to integrate payment gateways that offer different payment methods.

Preferred payment method

Each payment gateway supports different payment options. For US stores, credit card support is a given. You’ll still need a merchant account to link to your gateway, but the easiest gateway can provide one for you.

You will have to pay a fee known as credit card discount every time your customer runs a credit card. The discount is taken out automatically before the processor deposit the money into your bank account. This fee is determined by:

  • Individual cards: No-frills Visa and Mastercard would have the lowest fee, while American Express and cashback cards are known to be the most expensive.
  • Your payment processor: They will add a small percentage to the base fee. Again, you could have your processor (where you have your merchant account) or the gateway may provide one for you.
  • Risk factors: This includes your credit, business, merchandise, etc. If your business model and merchandise carry less risk of returns, defaults, etc., then the processor might charge you less.

As for the other payment options, PayPal can be more expensive than the most expensive credit cards. But it’s much easier to get approved if you have a new business. Online wallets and mobile payments are not standardized and might be a pain to incorporate individually. At the moment, most merchants only think about them if they want to make it easier for overseas buyers to pay.

Most importantly, customers want to feel safe so you need to be careful about the payment form and the included security steps. Here you have 3 options:

Redirect

This one offers the highest security and it’s suitable for most companies. A payment form can be integrated on the iFrame of your store. But the customer is actually leaving your website to make the payment.

Browser payment form

A browser payment form transmits customer data to the processor. There are lower security demands on your side except standard PCI data security standards.

Server payment form

This type of form allows your customers to quickly and easily enter their data. Speed is a great plus, but there are challenges in terms of security including PCI security compliance.

Customer experience

When all is said and done, a great payment gateway gives your customers a streamlined and enjoyable experience. It offers an easy check-out and the interface feels and looks safe.

You may enable auto-fill and saved payment info for your customers’ convenience. Guess who gets to enjoy the benefits of quick and easy payments in the end?

Top payment gateways for Magento stores

1. PayPal

PayPal earned its reputation by being one of the most secure payment gateways. Plus, it provides a lot of payment options. Your customers can pay via PayPal account, credit card, or PayPal credit.

This gateway also offers cutting-edge encryption and advanced fraud protection. The standard fee structure is 2.9% plus $0.30 for each authorization. You may qualify for a personal account manager and lower rates if you hit a certain monthly volume.

2. Authorize.net

If you run a small or mid-sized business, Authorize.net is a great solution. It offers more than a few payment options and good security. Your customers get to pay by Visa Checkout, Apple Pay, e-check, PayPal, and credit cards.

As for the security, this gateway features Advanced Fraud Detection Suite and CVV and address verification. Your customers can also store payment info by using the Customer Information Manager (CIM) option.

Authorize.net is available for businesses based in the US, Australia, Europe, and Canada. For credit cards, you can use your own merchant account or Authorize.net can refer you to one.

3. Stripe

Stripe is for business owners who need to quickly set up a payment gateway. It accepts Android and Apple Pay, Alipay, Bitcoin, and all major credit cards. And you can expect even more payment options in the future.

The gateway features PCI compliance and real-time fee reports. You pay the same fee per transaction as with PayPal and there are no monthly fees.

4. Amazon Payments

With Amazon Payments, customers are allowed to pay via an Amazon account. This can help you increase sales and reduce checkout time.

The gateway utilizes widgets to help your customers select shipping methods and payment options without leaving your store. Amazon Payments features the same fraud protection system as Amazon.com.

You are not required to pay monthly fees. The standard discount is 2.9% plus $0.30.

5. Braintree

Braintree is a PayPal-owned payment gateway that provides support for domestic and international businesses. Your customers can have 6 different payment methods including Bitcoin, Apple Pay, and Venmo.

This gateway offers built-in PayPal integration, fraud protection, and data storage. Your customers can also delete or add payment information. As you might guess, Braintree has the same fee structure as PayPal.

Cashing out

Choosing a payment gateway depends on your business needs. You’ll want to accept payments that make sense to you and your customers and make it easy for them to pay.

By interactivated • on March 15, 2019

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