As a small business owner that is building their online presence, you will likely require some method of taking payment online. It doesn’t matter whether you’re selling physical goods, digital goods, or services. Your business could benefit from using the internet to accept money.
But, that raises the question, “How do I accept payments online?” Well, there are dozens of solutions out there which can make it difficult to find the right one. That’s why I am only going to suggest to you two merchant services providers. Then based on your resources and needs, you can easily choose from there.
The Easy Solution
The easiest and most popular solution of accepting payments online is to use PayPal. Because of its popularity, PayPal has great brand recognition as well as great support from e-commerce solutions. This is great for small businesses because:
1 – You can get started for free.
2 – You can easily build a basic shopping cart using either PayPal buttons or a free shopping cart solutions. (Try wp-ecommerce and WordPress)
3 – PayPal’s brand recognition will help to build trust with your customers.
As a business owner you may be asking yourself how much it’ll cost you to get started with PayPal. Well, the great news is there are not setup fees and PayPal only charges 2.9% + $0.30 per transaction, which makes it a very affordable way to begin accepting payments online.
A Newer, Better Solution?
Another online payments solution that has become very popular with developers and startups over the past year is Stripe, which is a complete solution for accepting credit card payments online. There are no setup fees with Stripe and the fees are 2.9% + $0.30, the same as PayPal.
The only thing that makes Stripe slightly more complicated is that since they are a much younger company than PayPal, there are not as many software integrations that have been built. But, I was able to find out that wp-ecommerce (when used with a premium upgrade) Yak, and wp-stripe are all WordPress e-commerce plugins that will allow you to use Stripe in your WordPress website.
By now, you may be asking why I even mentioned Stripe if PayPal had so many features. Well there are two reasons here.
1 – PayPal has a reputation for sometimes being heavy-handed and putting a hold on funds if your account has any suspicious activity.
2 – I recently read an article where a business owner claimed that he made more profit switching from PayPal and Google Checkout to Stripe because the checkout process is simpler.
The only downside that I have been able to find is that funds are transferred to your bank account on a 7-day rolling basis. This means that you will not receive the money for your first sale until a week later.
So, Which One Do You Pick?
Overall, I think Stripe is the way to go if you are selling digital goods and/or services online due primarily to its simpler checkout process. But, you will have to deal with the initial 7 days of no money.
PayPal is likely the way to go if your business needs to also accept payments through phone or in person.
Ultimately, which service you pick depends on your business’s needs. Also, keep in mind that there is no reason you can not switch later.