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8 Things to consider while selecting a Payment Gateway for your Online Store

A payment gateway is a mode or an application service which facilitates the users to share their payment details from one bank to another using a credit or debit card, UPI payments, NEFT, etc. It guarantees the payment between the bank that is acquiring the payment and the bank which is issuing the payment. Generally, this service is by businesses that want to trade online and accept payments from its customers through their website.

According to Markets and Markets, a reputed Consulting Agency, the global digital payment market size is expected to form from USD 79.3 billion in 2020 to USD 154.1 billion by 2025, at a Compound Annual Growth Rate (CAGR) of 14.2%.

The Government of India has also been encouraging through their initiatives like Digital India programme with a motive to transform India into a digitally empowered society and economy. The motive was to provide a facility of uninterrupted digital payments to all citizens of India in a convenient, affordable, quick and secured manner.

Also now in this time of the pandemic, the digital payments market has gained a rapid boost. The government has passed guidelines for banks to encourage customers to use digital payment methods like UPI, NEFT, mobile banking and debit and credit cards instead of cash as a precautionary measure against the Covid is rapidly increasing.

We at Finden, have come across many clients who have various requirements for their business considering the facilities that they want to have for themselves and to give to their customers as well.

Many of these business owners want to build an eCommerce store for better reach and operations while struggling with the common query which is ‘What is the best payment gateway for my business?’

So let’s take a look into some common and most useful parameters that are considered by our clients while choosing payment gateway that suits their website.

Parameters:

1. Setup Cost and Domestic Charges:

The setup cost and domestic charges are those which include the initial costs to set up an account and the transaction charges that can be one-time charge or multiple times on each transaction. Now some of the providers might not charge a setup cost but shall have a higher commission percentage for each transaction. So, it is important to evaluate this factor.

2. International Payments Support:

It is basically a feature which allows its users to pay with help of any foreign cards which at times are not accepted for the payment purposes. For instance, if a foreign traveller coming in our country tries to pay using his foreign national card, then as a feature the payment gateways should accept those in favour of the business owners.

3. Multi-Currency Support:

As a business owner, you need to evaluate your if your target audience is from one or more countries. If so you can opt for this option and select currencies of those countries where your audience resides. So that any of your customers who are willing to buy your product can pay in those currencies.

4. Documentation Required:

When you decide to open a bank account there are some documents that you need to submit to open an account. Same applies for setting up a payment gateway. For example, in India to set up a payment gateway you need to submit a Business Proof, firm/Company PAN number, cancelled cheque / Bank account statement in the name of the business, etc. to get started with your gateway.

5. Settlement Time:

It is basically the time taken by the payment gateway to credit the money collected by them on behalf of you into your desired account. For instance, some gateways provide an option to schedule your settlements, that helps payments to automatically get credited in your bank account.

6. Security:

Security refers to methods used in payment gateways for data encryption. When the customer enters their payment information like credit and debit card details, the payment gateway should protect them from getting leaked.

7, Platform Integration:

It is basically the support for SDKs and plugins into various platforms like WooCommerce, Shopify, etc. that helps you to integrate the payment option into your online store or website.

8. After Sales Support:

After sales support happens to be the most important feature that a business owner should look out for. For example, in case you face technical issues while receiving payment online from your users on the website, customer support of that payment gateway provider is whom you will reach out to. In case the provider doesn’t have 24×7 call support then it will be difficult to address as well as resolve those issues which in turn shall affect your online sales.

There are various national and international payment gateways present in our market. Here are some of the gateways that are a popular choice among the businesses due to various reasons that we are going to see further:

Popular Payment Gateways in 2020

  1. Cashfree
  2. PayU
  3. Razorpay
  4. PayPal
  5. EBS
  6. Stripe
  7. CCAvenue
  8. Instamojo

Among these Razorpay, PayPal, CCAvenue, Stripe and Instamojo are the major players which have a chunk of the digital payments market in India. They have proved to be the most reliable among the businesses in our nation. So, let’s have a look at these payment gateways.

1. Razorpay

It is one of the most popular payment gateways here in India. It was founded in the year 2014 and has more than 800k users now.

The main feature of this gateway is that it has an instant activation and integration. It also has a Dashboard where you can see real-time data of transactions.

Big business names such as Unacademy, UrbanClap, Zoomcar, Groffers, BookMyShow, etc have been integrated with Razorpay as their payment gateway.

Setup Cost and Domestic Charges:

They have a simple and transparent pricing plan which has no hidden fees. The annual maintenance charges are none and transactions fees are as follows:

  • 2% per successful transaction and 1% for International cards, EMI and Amex;
  • No setup fees;
  • GST is applicable to 18% on the transaction fee.

International Payments Support:

Here international payment approval is a separate process and takes a longer period of time, which is subjected to the businesses bank’s approval.

Multi-Currency Support:

It does not have support for multi-currency transactions whatsoever.

Documentation Required:

One Business Proof; firm/Company PAN, Promoter’s PAN, cancelled cheque / Bank account statement in the name of the business, authorized signatory address proof.

Settlement Time:

It usually takes 3 days to settle payments in your connected Bank account.

Security:

This payment system is highly secured and a safe mode to transact through online payments. As it is PCI compliant and is a secured & encrypted communication.

Platform Integration:

They have mobile SDKs for Android and iOS via Cordova/Phonegap respectively. 

After Sales Support:

They have great after sales support. They also provide training for the end-user as a part of the after-sales service.

2. PayPal:

It is one of the most popular and globally recognized payment gateway that has its presence in over 200 countries with almost 325 million active users.

They have various features under their sleeve such as it has support for almost every international credit and debit card. They monitor transactions 24/7 that protects customers from fraud and also has a facility for recurring payment.

Setup Cost and Domestic Charges:

Here the annual maintenance charge is totally free and has zero maintenance charges whatsoever. The transaction fee per transaction is 4.4% + US$0.30 and currency conversions charges.

International Payments Support:

It can be used by a local merchant only for receiving international payments. PayPal does not support or recognize Indian currency, so you need to choose an international currency as your base currency. It means that if somebody pays you in say Yen through PayPal on your eCommerce store, PayPal will first convert that to US$ and then you can withdraw money from PayPal.

Multi-Currency Support:

PayPal has support for over 100 currencies globally and being a PayPal merchant, you can keep your earnings in around 57 currencies as you want to.

Documentation Required:

It only requires an identity proof; your PAN card details and your bank details to get started with your PayPal account.

Settlement Time:

The payments that you receive in your PayPal account gets auto-withdrawn to your desired bank account as per your need or on a daily basis.

Security:

It is considered to be one of the safest and trusted payment gateways globally.

Platform Integration:

It has support for both Android and iOS as well as various eCommerce platforms as plugins.

After Sales Support:

After sales support is one of the features to make PayPal so successful. It has a 24/7 connection on their official website.

3. Stripe:

Stripe is a payment solution that is known for its simplicity and is limited to processing card payments. It was founded in 2010 by Irish entrepreneurs and brothers John and Patrick Collison. They launched their public service in September of 2011. Over the next several years, they received almost $800 million in funding, and a valuation of over $22 billion, making them one of the most valuable private companies in the world.

Stripe grew quickly because their products were developer centric products. The platform was built to be easily integrated into both custom and existing digital apps and to provide clear and straightforward directions.

Setup Cost and Domestic Charges:

Here the initial setup fee is zero, annual maintenance charge is none and transactions fees are as follows:

  • Domestic Credit & Debit cards on Visa, Mastercard: Flat fee @ 2% and  American Express cards issued in India @ 3.5%. Fees exclude GST.
  • International Credit & Debit cards on Visa, Mastercard: Flat fee @ 3%; American Express cards issued outside India @ 3.5% and International Cards with USD or another currency present @ 4.3%.

International Payments Support:

It has support for international payments and credit cards support.

Multi-Currency Support:

They accept payments in 135 plus types of currencies throughout the globe.

Documentation Required:

The documents required are very simple, one which serves as proof of identity, and one which serves as proof of your home address.

Settlement Time:

It takes seven calendar days from a payment being received to it being paid out from Stripe accounts to your bank account.

Security:

Stripe is equipped with certified PCI Service Provider Level 1. This is the most strict level of certification available in the payments industry.

Platform Integration:

It has support for all platforms like Windows, Android and iOS with help of SDKs and various eCommerce platforms as plugins.

After Sales Support:

They have a 24×7 help from our support staff to solve their query on call and also have a feature where you can ask their experts on their website and they answer us with relevance to our query.

4. CCAvenue:

This payment gateway is very easy to use, fast and secure. CCAvenue is one of the most popular payment gateways in the South Asia region.

Air Asia, Lakme India, eCommerce giants like Myntra are the prime businesses that use CCAvenue as their payment gateway.

Setup Cost and Domestic Charges:

Here the initial setup fee is zero, annual maintenance charge for a Startup account is Rs 1200. The transaction fee per transaction are variable and are as follows:

  • Domestic Credit & Debit cards on Visa, Mastercard, Maestro RuPay will have a fee @ 2%
  • Mobile Wallet fee @ 2%
  • IMPS & UPI fee @ 2%
  • International Credit Cards on Visa, Mastercard, American Express, JCB and Diners Club with flat fee @ 3%
  • Taxes extra as applicable from time to time.

International Payments Support:

It has support for international payments. You can represent your product pricing in any number of currencies on your eCommerce store.

Multi-Currency Support:

They have support for Multi-Currency payment Gateway that supports 27 foreign currencies worldwide.

Documentation Required:

PAN card, the front page of Cheque Book. If you are a proprietor then a Proprietorship Registration Certificate is needed. For NGOs, Trust Deed, Audited balance sheets are required. For Financial Advisors you need an Investment Advisor Certificate to submit.

Settlement Time:

It settles payments on a weekly basis for all amounts over & above of Rs.1000, which is the minimum amount required to be kept with them.

Security:

For security purposes, the company has built FRISK (Fraud and Risk Identification System & Knowledge) that gives utmost security while doing payments.

Platform Integration:

This has support for Android, Windows and iOS platforms with help of SDKs and various eCommerce platforms as plugins.

After Sales Support:

They have a 24×7 help from our support staff to solve their query on call and also have a feature where you can ask their experts on their website and they answer us.

5. Instamojo:

Instamojo is another successful Indian payment gateway company that has around 1 million active users. Instamojo is India’s largest payment gateways that empower over 1,200,000 small entrepreneurs, startups, etc to start, manage, and grow their business online across mobile and web.

Shriram Properties, Zepo, Adani Realty, SpringBoard are three of the top customers of Instamojo.

Setup Cost and Domestic Charges:

Here the initial setup fee is zero, annual maintenance charge is none and transactions fees are as follows:

  • The NEFT/ RTGS/ Bank Transfer charges are free.
  • For UPI, Debit or Credit card, Wallets, net banking payments it charges 2% plus Rs. 3 per transaction
  • For International Cards like Visa and Mastercard and American Express cards, it charges 3% plus Rs. 3 per transaction

International Payments Support:

It enables international payments on a case-to-case basis, based on your transaction history on the Instamojo account.

Multi-Currency Support:

They process payments in Indian Rupees (INR). They currently do not support multi-currency payments. For example: Even though an international card is being used, your customers will be charged in INR.

Documentation Required:

PAN card, the front page of Cheque Book. If you are a proprietor then a Proprietorship Registration Certificate is needed. For NGOs, Trust Deed, Audited balance sheets are required. For Financial Advisors you need an Investment Advisor Certificate to submit.

Settlement Time:

It allows recurring billing facilities so that merchants can settle their payment on a monthly basis.

Security:

It is equipped with certified PCI DSS certification, Tamper proof links, 128-bit Encryption. In short, it is highly secured and safe.

Platform Integration:

This has support for Android, Windows, PHP, Java, Python, iOS, etc. platforms with help of SDKs and various eCommerce platforms as plugins as well.

After Sales Support:

They have a 24×7 help from our support staff to solve their query on call and also have a feature where you can ask their experts on their website and they answer us.

We hope the above mentioned points help in understanding the factors that you should consider while selecting a Payment Gateway for your Website. For professional assistance, you can reach out to Finden Go Digital, we will help you with building your business’s digital presence.

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