When your business decides to accept credit cards online, it is important to discover your options for online payment solutions. Online payment solutions allow businesses and consumers to exchange money electronically over the Internet.
Advantages of Online Payment Solutions
Online payment solutions can either replace or supplement your decision to accept credit and debit cards. Opening an online payment account is often faster and easier than setting up a Merchant Account (which is required to accept credit and debit card payments). Online payment accounts typically incur smaller fees than a traditional Merchant Account, which can have a big impact on businesses with many small transactions. From a customer-service perspective, itâ€™s beneficial to have multiple payment options available. Online payment solutions are also user-friendly and can simplify the payment process by storing customer card information or billing customers at a later date.
Major providers of online payment services have developed features like two-factor authentication to help businesses enhance e-commerce security. Two-factor authentication requires businesses to enter a six-digit code in addition to their password, making third-party scams rare. As e-commerce becomes more popular, security features will continue to evolve. Be sure to look into merchant service providers who offer secure, PCI compliant online payment solutions.
Magento Shopping Cart
Now, a lot of solutions are available to Magento carts and each come with a bundle of features that may or not be appealing to your business. It is important to understand that processing credit and debit cards is the basic functionality that every gateway and solution provider offers. However, as many gateway providers only handle the transmission of the data and don't do the actual work of processing the transactions your costs of processing and the few other important elements can be impacted by your choice of solution provider.
With every credit card data transaction, a series of data is transferred to the acquiring bank. The gateway and the processor will take a portion of what you pay in the form of processing fees on every single transactions. Since a big chunk of your processing fees are taken by Visa and Master card the percentage of fees associated to your gateway and processor is relatively small, but it exist nonetheless.
One of the best solutions to reduce these fees is to opt for a solution provider that provides the gateway and processing services. Companies must be a part of banking network such a First Data to be able to process your transactions. By cutting the middlemen, you can reduce your processing fees to some extent. But, as I explained it in the previous paragraph, a big portion of your fees are interchange fees or those fees set by Visa and Master Card. These rates are not negotiable and there's very little gateway providers or processors can do to reduce it. However, a little search for integrated Magento credit card processing solution provides a host of new solutions that can offer a whole new set of feature in addition to great cost reduction strategies.
With an integrated solution, you can now capture and pass more information on every transaction to qualify it at lower interchange rates. This is only possible via an integrated solution because a software is required to capture and transfer the data you need for better qualification and lower rates.
In many case, if you have good processing volume and history, you can ask the solution provider for flat rates and next day funding. Again, having a complete visibility into your processing history along with the security of an integrated module allows them to lower the risk factors and pass the savings to you.
Another great feature of an integrated solution is the ability to view your transaction and dig into your history or to create customizable reports. Many merchants also benefit from cloud data storage provided by their solution provider to manage recurring billing.
A full analysis of your business' needs and a complete understanding of your accounting practices will help you to make a solid decision on the next processing solution your business will adopt. However, some of the main and most important features of a payment gateway that you should seek are:
- data encryption and tokenization
- Batch history and reporting
- email receipts and confirmation
- easy voids and refunds
- Low processing costs and fixed/flat rates options
As many of Magento users use more than one payment gateway, be sure to look for a solution that can seamlessly work with major gateways.