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This is why some payment processors are more expensive than others

Choosing a payment processor that is ideal for your business depends on three factors:

  1. Costs
  2. Compatibility
  3. Features

Understanding costs

Processing credit cards is not cheap. Every major card networks, like VISA, Mastercard and American Express, charge hefty fees to processing companies making this service available to businesses.

If we were to go directly to a major credit card network like Amex, for example, the processing fees would be prohibitive, often in the realm of 5 or 6 percent per transaction.

On the other hand, when choosing a payment processor, or "vendor", fees fall considerably, typically down to 1-3 percent, plus a small monthly fee.

Many of these vendors offset the costs of processing major credit cards, through advertising, partnership deals with ecommerce companies, and sometimes even membership programs.


Payment processors are not one-size-fits-all. Depending on the type of website, some will work and others won't. It's important to understand which processor is the most compatible with your ecommerce website.

Some processors allow basic integration with only a limited number of devices and methods of processing, such as in the case of bundled programs that include hardware and software, as well as hosting.

The costs associated with theservice programs can be high, due to the managed nature of the system.

On the other side of the spectrum, we find payment processors that provide developers to create their own independent solutions.

Somewhere in the middle is where most small businesses find their ideal balance.


Costs and compatibility are not the biggest factors tipping the scale towards the most ideal solution for a business looking to accept payments online.

Accepting payments is only one component of ecommerce. Being able to develop metrics and extrapolate sales data is important to understand customers and their shopping habits.

As affordable as the cheapest payment processing solution may be, it's important to be able to build and access a history of purchases and transactions.

The value of sales analytics should be factored in when choosing a payment processor.




How do you choose the right payment processor for your business? Here is three factors to be considered.




9th March, 2015


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