Online Payment Transaction Solutions

Searching and evaluating for the best payment transaction solutions is another time consuming task especially for those who are new to ecommerce. It is very important that we fully investigate all the options, carefully study all the benefits and drawbacks, all the startup and recurring fees and the vital features provided by each company before deciding on the one that best suits our needs.

Generally, there are two options to accept credit card payment online:-

Using Third Party Credit Card Processor.
Acquiring Online Business Merchant Account.

Third Party Payment Processor.

For most just start-up small business owners, third party payment processors seem like a more suitable choice overall. They allow merchants to accept credit cards without a merchant account where the transactions are processed through the third-party providers' accounts.

They charge a processing fee with each transaction that is higher than the discount rate charged by most Independent Sales Organizations (ISOs). However, for most Third Party Payment Processor, this is the only fee you'll pay. This means you pay less for smaller orders and nothing when you're not selling.

It certainly costs far less than a merchant account especially if the sales volume is considerably low, say less than USD$1000.00 per month. In addition, most third party processors also provide checks payments option. Some also provide extra features such as digital delivery, free shopping cart and affiliate program management.

Third Party Payment Processor offers a safe way for fledgling businesses to get off the ground.
Apart from small sales volume, you might consider using a Third Party Payment Processor if you:-

are not qualified for a merchant account due to credit history or the nature of the products
have limited budget
sell limited number of products
live outside of the US

Things to look for in a Third Party Payment Processor:-

Fees

How much is the setup fee?
Transaction fees. Carefully study this fee structure as it varies from one to another and it is the main cost of using 3rd party processor.
Does the processor offer ability to accept online checks and/or telephone orders? Are there additional fees for this service?
How often they provide payment or transfer your funds to you?
Settlement fees. How much the company charge to send you a check for each pay period, or to wire transfer your funds to you?
How much is the reserve? A 'reserve' is the amount held back from each pay check as a "slush fund" against future refunds, returns, or chargebacks.
What are the chargeback fees? What are their chargeback policies?

Setup and Reliability.

How easy it is to integrate their payment transaction solutions with your existing website?
How often do their processing system experience down time. Generally, given the nature of their business, most 3rd party payment processors have some form of problems reported against them by the merchants who have been using their services. How severe are the problems and how do they handle them. Talk to others who have used the service or check through other ecommerce forums on the previous problems being brought-up on a particular company.

Restrictions and limitations.

Is there a minimum monthly sales quota you must reach?
Is there a maximum product price you can set?
Does the company restrict on the type of products you can sell?
Do they handle tangible as well as intangible products? For intangible products, do they offer digital download service and what are the charges?
Do they provide recurring billings facility?

Customer supports.

What form of support do they offer?
Does the company respond promptly and helpfully when contacted?
Do they have support forum for their merchants.
Do they provide transaction reports? How details are those reports?

Other features.

Do they provide shopping cart service, affiliate program etc?
What other value-added features do they offer for free or at minimal cost?

Most importantly, carefully read the terms and conditions of agreement, the fine prints, the hidden costs, other regulations as well as the charge back policy, before signing up for a service provider.

Here are the best Third Party Payment Processors that we had reviewed.

2CheckOut.com (For US and International Merchants)
WorldPay.com (For US and International Merchants)
Paypal.com Note: Paypal offers a relatively inexpensive payment procesing solution. However, take special care to FULLY comply with agreement you accept when you sign up with them since they can freeze your account without prior advice as many had already faced.

2. Acquiring Online Business Merchant Account next page...