Effective Ways to Choose The Best Payment Gateway in 2021
Finance 86

Effective Ways to Choose The Best Payment Gateway in 2021

Effective Ways to Choose The Best Payment Gateway in 2021

Every growing business struggles with finding the appropriate payment gateway for their e-commerce business or portal that requires online transactions. Online customers and markets are the key selling points for online sellers and retailers. According to reports by Statista, the growth of online payments is predicted to hit a CAGR of over 20% within the period 2019 to 2023. If we look at this as figures instead of percentages, it totals to about 660 million new Indian customers who will start using online payment gateways by 2023. Therefore, merchants need to learn which factors to consider while choosing the best payment gateway for their business.

Factors to Consider While Choosing a Payment Gateway

1. Setup Fees vs Transaction Charges:

If your business is a startup or just in the initial stages of growth, it makes sense to invest an initial setup fee of Rs. 5000 or $90 annually, because your business will take time to grow. You should consider a payment gateway that doesn’t charge a setup fee. However, they charge a high transaction fee which comes up to 4-5%. 

For well-established business with a large marketing budget, choose a payment gateway with a 1-2% transaction charge, assuming traffic for the business will grow quickly.

2. Evaluate the Need for Automatic Billing Support:

When selling a product or service that relies on a subscription-based business model, choose a payment gateway that allows recurring automatic payment cycles. You can get this kind of support from gateways.

3. Review the Purchasing Funnel:

Evaluate the total number of steps that customers need to go through to reach the payment completion page. If you have too many steps, customers might drop off before completing the payment. Don’t ask customers for too much information, and make sure your payment gateway is simply there for the payment process rather than asking people to make an account or register.

4. It’s Not a Permanent Decision

Start your online business with whichever payment gateway suits your requirement and can help you complete the payments that customers initiate on your page. You can easily switch to a different payment gateway if your business grows or if you change your business setup. It is advisable to choose a transaction fee model here instead of a high setup fee.

5. Your CMS Must Support the Payment Gateway you Choose:

You will get an off-the-shelf payment gateway plugin with every e-commerce CMS. Make sure to check with your payment gateway whether your CMS is supported or not. 

6. International Customers:

If your customer base is not just within your country, make sure the payment gateway you choose supports foreign credit cards and other payment methods. 

7. Keep Multiple Options for Payment Gateways:

If your business is just starting, it helps to have multiple payment gateway options. This will help build your customers’ faith in your business. 

8. Check for Customer Support:

When you are still evaluating payment gateway options, try to reach their payment gateway support teams over the holidays. If you can’t reach them or if they can’t solve your problem, you need to choose a different gateway for your business. However, keep your budget in mind and consider your technical skills as well. 

Budgets should not be the primary factor while deciding on your payment gateway. Cost-efficiency is important and you need to stay within a budget, but look at the bigger picture as well. Choose a payment gateway that will justify all the services you need at a budget-friendly rate.

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Finance 86