Resources
Know how
If there’s a topic we’ve missed, let us know, and we will be happy to dive into it.
- What is the SEPA payment method?
- What are quick payments in one click?
- What are cross-border payments?
- What is a payment gateway provider?
- What is a payment system?
- How to integrate payment gateway APIs?
- How to accept mobile payments?
- What is a payment link?
- What are open banking payments?
- What are payment methods?
- What are local payment methods?
- How to accept international payments and transactions?
- How to accept payments on PayPal?
What is a payment gateway provider?
If you need information about payment and payment gateway providers, look no further. Continue reading to discover more about payment providers, including:
What are payment providers and gateways?
A payment service provider or gateway is a third-party company that enables businesses to accept electronic or online payments, such as credit card and debit card payments. For example, if you buy an item online on eBay, the eCommerce payment provider Adyen acts as an intermediary or gateway between you, the buyer, and the seller. That means that the funds get transferred from you to the buyer via the online payment service provider or online eCommerce gateway.
Payment service providers and gateways make it simple to take card payments, either online, offline, or in-store, with eCommerce in-store Point of Sale (POS) systems.
Having a payment gateway can be a great way to handle low-volume sales, but with processing fees involved, it could be better to pay a monthly fee to have merchant processing included with your account if you begin to take a large number of online transactions.
The best payment service providers should offer easy merchant integration, global gateway processing, flexible pricing plans, mobile payments, robust online security features, multi-languages and currencies, and more on the list.
Some of the best payment service providers and eCommerce gateways include these on the list:
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What are the different types of payment service providers and gateways?
Depending on the nature of your eCommerce online business, your payment service provider will likely fall under one of three online categories: a hosted, an API-hosted, or a self-hosted provider.
With a hosted payment service provider, merchants and business owners can paste or embed the payment link onto their own website via the source code. From there, buyers can click on it and get directed to a separate payment and eCommerce checkout page. Although hosted gateways are safe and relatively cheaper, the extra step of leaving one website and completing the payment on another may be off-putting to some, resulting in merchant cart abandonment.
API-hosted payment providers let businesses handle the entire payment process themselves. That means that everything from payment initiation to payment completion takes place on the merchant’s website. API-hosted payment gateways are best for multi-national, multi-corporation businesses that handle large volumes and need all customer payment details to remain in-house.
API-hosted payment providers are only really affordable to large companies as they need to develop and maintain the online technology while covering the additional costs of merchant SSL certification and PCI DSS compliance.
Finally, self-hosted gateway providers work by taking the buyer’s payment details directly on the merchant’s website instead of on an external, third-party online website. That’s made possible as the merchant’s website already has a payment gateway pre-installed. The customer’s card details are only encrypted and submitted to an external party payment provider for online verification. This means that the checkout page is displayed on the eCommerce merchant’s website, and there’s no need to leave to go to another online website.
As a one-stop payment platform, Fondy understands the need for businesses and electronic commerce stores to be flexible and to accept various payment methods in a variety of currencies. Want to know more about us? Great. Check out our about Fondy page and discover what inspires us and how we can best benefit your business, no matter the size.
What are examples of self-hosted payment providers?
Some of the best-known online eCommerce marketplaces that we use daily double up as self-hosted payment providers. That means that you can search, shop, and complete your payment all in the same place. Below are examples of self-hosted payment providers, online gateway marketplaces, and how much each type of payment gateway costs to use.
Amazon marketplace payment gateway
As its famous logo shows, Amazon sells everything from A to Z. As a world-renowned platform, Amazon instantly gives your products an online stamp of approval. Amazon offers two main selling plans:
Individual Selling Plans
Professional Selling Plans
Professional Selling Plans start at £25 per month, while Individual Selling Plans are free of charge. Although cheaper, Individual Selling Plans come with a £0.75 fee for each product sold through the Amazon merchant gateway website.
However, If you’re new to selling on the Amazon gateway, one of the best options is to use the Fulfillment by Amazon (FBA) feature. Depending on your products, FBA could end up costing more to run than other Amazon merchant plans, but it takes a lot of the heavy lifting off your shoulders.
With an FBA account, Amazon will receive your goods and process every aspect of the sale whenever you have buyers. In return, you’ll pay a monthly storage fee starting at £0.39 per cubic foot and a fulfillment fee.
The fee payment is calculated based on the dimension and weight of the goods. It also factors in the channel the item gets sold on, i.e. amazon.co.uk or an Amazon affiliate gateway. Another advantage of using the Amazon gateway is its advanced online search technology. When users search for certain goods, other relative products appear as suggestions. For example, if you sell knitted scarves, they will be recommended to users who search for winter coat merchants.
eBay marketplace payment gateway
With nearly 30 years of experience as an online marketplace, eBay is one of the world’s most trusted gateways. eBay is one of the best places for merchants with low to no investment to start making profits and an online presence. All you need is a laptop or smartphone and a reliable internet connection. From the comfort of your sofa, you can attract the best customers from all over the world.
Although eBay is the original auction-based website, you also have the option of setting ‘buy it now’ prices and sending and receiving the best offers and payments from interested buyers.
One downside of eBay is that it hosts so many different sellers. As a result, it can be hard to stand out as the best option if you’re selling generic products online. Using competitive online platforms like this is why providing as much information as possible is vital. The eBay gateway also takes a 10% transaction fee of your sale, i.e. a significant slice of your commerce.
Google Shopping marketplace payment gateway
Signing up with Google Shopping lets you put your products and website in front of millions of people. Powered by the most popular search engine in the world, your Google Shopping merchant adverts appear at the top of their search results pages list when users search online for goods matching your product’s keywords.
The main benefits of Google Shopping are its high click-through rates, i.e. users are more likely to click on the ads than the search results below them. The Google Shopping gateway is visually appealing and provides the best insights into data so you can analyse and make a comparison of your product’s performance.
However, using the Google Shopping gateway means you’ll pay-per-click (PPC). PPC means that each time someone clicks on your Google Shopping ad, you pay a small charge starting at around £0.50. While PPC gets your products in front of more eyes, you still have to pay for clicks even when they don’t result in a sale.
Etsy marketplace payment gateway
From pottery to greeting cards, Etsy is the ideal platform for selling vintage, custom, or hand-made products. The benefit of the Etsy gateway is that it’s best tailored toward a creative audience, meaning you’re more likely to attract serious buyers. The downside is the range of fees Etsy charges. These charges include a £0.15 listing fee, a 5% transaction fee, and a 4% + £0.20 payment processing fee.
When you start selling on Etsy, you can create a personalised merchant shop with a logo, a banner, and a description of your brand. You can also add social media buttons to your shop, letting customers discover more about you and your company. The Etsy gateway allows you to sell items to order and charge more for them. There’s also the opportunity to create merchant vouchers to promote customer loyalty, best-buy, or one-off provider sales.
Shopify marketplace payment gateway
If you want to combine the style of your own website with online marketplace functionality, then use Shopify to sell your goods online. Shopify is an all-inclusive software built to create online stores.
It’s a one-stop shop offering everything that you need to sell your goods, including hosting, coding, order management, and design. The Shopify gateway is best for entrepreneurs who want to focus more on the selling part rather than the technical aspects of an online store. For a range of business needs, there are three Shopify provider plans on the list, including:
A Basic Shopify plan at around £23 per month
A Shopify plan at about £60 per month
An Advanced Shopify plan at around £225 per month
If you’re a small or new business, the Basic Shopify plan is one of the best gateway payment options on the market. For about £23 per month, benefit from features such as an online merchant shop, integrated marketing platforms, and 24/7 multichannel support.
What do payment service providers do?
Payment gateways enable merchants to accept different payment methods and process payments without the need to pair or be reliant on a particular banking institution.
Payment service providers are an important part of accepting online payments, but they work in conjunction with other bits of advanced technology. Payment gateways use API technology to communicate between merchant online eCommerce websites and payment processor solutions.
Physical merchant stores and businesses use payment gateways like POS terminals to connect to the payment processing network via a phone line, but more commonly, a WiFi network.
Initially, POS terminals were used to accept bank cards (via card swipes, the manual input of data, or a signature). That later turned to “chip and pin” payments, where customers were required to insert their bank card into a POS terminal and input a personal identification number (PIN).
Nowadays, near-field communication (NFC), or contactless payments, means that payment gateways can process transactions even more quicker than ever. Today, payment service providers and gateway solutions can exist entirely online, meaning you can process payments from anywhere without the need for a POS terminal provider.
The best online payment gateways and providers
Many payment gateways and providers claim to be the best for your business. The truth is that it mostly depends on the size, competitor comparison, and structure of your company. For one-person enterprises or new start-ups, you may be wasting money by paying for a beefed-up payment gateway or merchant payment provider that comes with all the bells and whistles.
Instead, while your business is steadily taking shape, your eCommerce or online business may only need a gateway or provider that accepts debit card and credit card payments, work easily with POS systems, and integrate with external payment apps such as human resources, analytics, and accounting software.
You’ll also need to factor in fees, as they can quickly add up. If you only handle a small number of transactions, then paying a nominal fee now and then won’t hurt your wallet as much. However, if your business plans to process larger volumes, then a merchant gateway with a fixed monthly cost for unlimited transactions might make more sense.
Fondy is the best payment gateway for marketplaces and marketplace merchants. When you create a free Fondy account, you’ll get access to Fondy’s best suite of payment products in one simple integration. Fondy’s payment gateway processes transactions in over 150 currencies in 200 countries using multiple payment methods, including Open Banking providers across 300+ banks in the UK and EU.
Our payment gateway seamlessly integrates into over 21 payment marketplaces, marketplace merchants, platforms, CMS systems, and website builder providers, including these on the list:
Discover what plugins, platforms, and marketplaces Fondy supports for your business. If you don’t see your preferred marketplace or marketplace merchant, plugin, or platform on the list, no problem. Our team can help with custom merchant integration solutions. Contact us at support@fondy.io to get a pricing comparison and get started.
Fondy’s pricing starts at 0.5% plus a set payment fee of £0.20.
What are the alternatives to payment service gateways?
Payment service providers and gateways aren’t the only way to make payments across borders. For instance, imagine you’re a business owner in need of a way to send money to freelancers in another country. As well as using a payment service gateway or payment merchant provider, you can always:
Use your bank
You can use your bank or building society to pay freelancers abroad, and it might seem like a convenient choice, but banks are a slow and expensive option for international money transfers. Additionally, if you’ve agreed on a payment date, it can also be frustrating for your freelancer to wait up to an additional week for the payment. In addition, overseas transfers from one bank to another usually incur charges that can apply to your merchant or eCommerce account or your contractor on collection.
Make a credit card payment
Freelancers sometimes accept credit card payments via mobile apps for their services. Apps like the PayPal gateway handle these payments, but they are rarely the cheapest option available. When you send business payments to China, for example, the contractor may also be charged withdrawal fees just for transferring payments into their own bank accounts.
Before you use an app to pay by card, bear in mind the exchange rate markup that they charge you. This isn’t usually advertised, and you could end up losing a significant chunk of your cash if you’re not careful. Firstly, it’s unlikely you’ll be offered the mid-market rate, i.e. the best exchange rate. Secondly, you’ll find that the rate on offer favours the app by around 10% – meaning they’ll take that much from the payment you send.
Pay with a freelance provider
Another way of paying a freelancer in another country is to use platforms like Fiverr and Upwork. Services like these are great for finding freelancers but can be expensive when it comes to paying them.
Companies like these can charge the freelancer up to 15-20% of their payment fee. High charges like these often leave the freelancer with no other option than to overquote your business for the work. For more value for your money, try finding the best freelancers independently and paying them with a specialist business money transfer provider or eCommerce payment service gateway.
Use a remittance service
There are many money payment transfer services around, such as WorldRemit and Western Union. However, some of these companies are expensive to use and provide a “one size fits all” service to both personal and business customers. The best bet is to find a remittance payment provider that offers dedicated business merchant accounts to everyone from sole traders and startups to multinational corporations. You normally pay a single, low fee and get some of the best exchange rates on the market. Even better, these transfers are usually instantaneous and benefit from some of the best security on the market.
In conclusion, there are a tonne of different options for making cross-border payments. And depending on where you live and the technology you have access to, one payment method may suit your business better than the next. The solution is probably to use a payment service provider or gateway that has years of expertise in this field. What most payment service providers feature is a robust one-stop solution that’s perfect for making global merchant payments.