How to Choose an Ecommerce Payment Gateway
If you want to sell online, you need a website payment gateway — and whichever one you choose will heavily affect your business.
So, it’s best to choose right.
But there are so many online payment gateway services out there — which one is right for your needs? You’ve probably got tons of questions, like:
- What are online payment gateways?
- Are there different types of ecommerce payment gateways?
- Why are online payment gateways so important?
- What are the top website payment gateways in Hong Kong?
- What do you need to know to choose the best payment gateway for your business?
Stick around to find out.
In this article, you’ll learn everything you need to know about online payment gateways. By the end of this article, you should be able to choose the best payment for your business confidently.
Let’s start with the basics:
What is a payment gateway?
Ecommerce payment gateways are software services used by merchants to accept payments online, such as credit and debit card payments and digital wallet payments, via services like AliPay, Google Pay, and Apple Pay. Every online transaction requires a payment gateway to facilitate the exchange of money.
3 Types of online payment gateways
Generally speaking, there are 3 types of ecommerce payment gateways:
Redirect payment gateways
On-site checkout – off-site payment
On-site payment gateways
Let’s take a close look at each one.
1. Redirect payment gateways
A redirect payment gateway is exactly what it sounds like — the online merchant will forward the customer to the payment gateway’s website to complete the transaction.
PayPal is a common example — in the image below, the apparel brand Gymshark offers customers the option to checkout with PayPal:
Redirect payment gateways are convenient and straightforward to set up. Also, for new and small online sellers, redirecting shoppers to a large, trusted service like PayPal can help to increase trust and reduce abandoned carts.
2. On-site checkout — off-site payments
Another option is to have customers checkout on your website while the payment process happens on the payment gateway’s site.
This is how Stripe works — you can use it to build a branded checkout experience on your website without worrying about the technical and security issues of managing the payments process.
This method is a little more challenging to set up than redirect payment gateways, but the branding opportunity can make it well worth the effort for established companies.
3. On-site payment gateways
Lastly, enterprises often use on-site payment gateways that they manage on their own servers. In this scenario, you would own the entire checkout and payments processing experience.
The key advantage of this option is the control and flexibility it provides. When it comes to online checkouts, every variable has the potential to increase sales, so owning the process entirely allows businesses to optimise checkouts freely.
That said, managing payments in-house comes with enormous banking and data security responsibilities.
The importance of choosing the right ecommerce payment gateway
As noted, every business selling online needs a website payment gateway. However, it’s best not to rush into using the first ecommerce payment gateway you come across. Why? Here are two reasons:
1. Online payment gateway security
It’s vital to choose an online payment gateway with security capable of handling the security you need.
For example, according to the 2018 Thales Data Security Report, 75% of U.S. retailers have suffered at least one cybersecurity failure with their online stores.
2. Checkout experience
Not every shopper will complete their transaction.
In fact, the Baymard Institute reports that 69.8% of shoppers abandon online shopping carts before completing the payment process.
As a result, reducing your abandoned cart rate is an effective way to increase sales — and this starts with a streamlined checkout experience.
Whether it’s the page load time, user experience (UX) design, or brand trust, the payment gateway you use will significantly affect sales.
7 of the best payment gateways for ecommerce in Hong Kong
Now that you understand what ecommerce payment gateways are and the key considerations to keep in mind when selecting one, what are your options?
There are countless online payment gateways to choose from — here are 7 of the best payment gateway services for small businesses.
Stripe is a hugely popular online payment gateway.
It provides a way for businesses to create a checkout experience on their websites using an application programming interface (API), while taking care of the payment processing and security.
In other words, you can manage the front-end presentation of the checkout while Stripe manages the back-end functionality.
The service is renowned for its intuitive dashboard and relatively simple setup process. It also enables merchants to take payments in tons of currencies via payment processors like Visa, MasterCard, and American Express.
Stripe doesn’t charge ongoing monthly fees. Instead, it charges 3.4%, plus HKD 2.35 per successful card charge.
But you can get fee-free processing on your first HKD 250,000 on Stripe with Neat!
PayPal is another big-name online payment gateway available in Hong Kong.
Its main offering is a redirect payment gateway that allows businesses to accept credit and debit card payments via the service’s Express Checkout. Consequently, it’s a great way to hit the ground running and start taking payments quickly.
PayPal charges higher transaction fees than some of the other payment gateways on this list — 3.9%, plus HKD 2.35 per successful card charge. It’s also worth noting that international payments cost 4.4%, plus HKD 2.35 per successful card charge, as well as currency conversion fees.
Braintree is a subsidiary of PayPal, and it’s the company’s white-label payment gateway service. In other words, it allows businesses to own a website checkout experience powered by PayPal.
This ecommerce payment gateway is very similar to Stripe, offering all the essential features a small-to-medium sized business (SME) might need.
And like Stripe, there are no ongoing monthly fees, and the transaction fees are the same: 3.4%, plus HKD 2.35 per successful card charge.
Alipay is a massively popular Chinese-based payment gateway and digital wallet provider owned by Alibaba Group. It offers a flexible payment gateway that merchants can use to take payments online and in-store via Alipay’s point-of-sale (POS) system.
To get up-to-date information about transaction fees, contact Alipay support.
eWAY is an Australian online payment gateway available in Hong Kong that facilitates payments via Visa, Mastercard, AMEX and JCB payments.
This service makes it simple to get started — plus, it offers unlimited 24-hour support, so help is on hand if you ever get stuck.
eWay charges transaction fees of 3.4%, plus HKD 2.35 per successful Visa, Mastercard or JCB transaction. Also, international card transactions are subject to an additional 1% cross-border fee.
This payment gateway enables merchants to take payments via multiple channels, including websites, smartphones, and in-store via an integrated POS solution.
For pricing information, contact sales at AsiaPay.
Adyen is another payment gateway available in Hong Kong, with many big-name brands using the service, such as Uber, McDonald’s, and Microsoft. However, it’s also one of the best payment gateways for small businesses.
Adyen facilitates both POS and online purchases, and it accepts a range of payments from every major global payment processor.
The service charges HKD 0.12 per transaction, plus a variable fee depending on the payment method used.
How to choose an ecommerce payment gateway for your business
Now that you understand the basics and are aware of some ecommerce payment gateway services, how can you choose which one to use?
Here are five key questions to keep in mind when selecting an online payment gateway for your business:
1. What payment methods does your target market use?
First things first: what payment methods do you need to be able to accept? For example, if your target market regularly uses PayPal or WeChat, it’s essential that you’re able to accept payments from those services.
So, start by writing a list of every type of payment you want to accept, then look for payment gateway services that support them.
Here’s the thing: You may not find a payment gateway service that supports every payment method you need. In this case, you may want to stack payment gateways — in other words, use multiple gateways to offer more payment options to customers.
2. What are the payment gateway’s fees?
Transaction fees can seem small at first — after all, it’s only a few cents here and there, right? Be careful though, because these fees rack up over time and eat away at your profits.
For this reason, it’s worth shopping around for a service that offers competitive fees.
That said, pricing isn’t everything. A cheaper payment gateway may have more security weaknesses — which could end up costing you more in security and fraud detection. This brings me to my next point…
3. How secure is the payment gateway?
As noted, security should be a primary concern.
Not only can security issues create logical and legal problems, they can also hinder your bottom line. According to Experian’s Global Fraud and Identity Report, 27% of customers abandon a cart because of a lack of visible security.
So, be sure to choose a payment gateway compliant with The Payment Card Industry Data Security Standard (PCI DSS). PCI compliant payment gateways meet the necessary security criteria needed to keep your business and customers safe.
4. What is the payment gateway’s reputation?
As mentioned above, customers want to see visible signs of security when checking out — and adding them can improve your conversion rates. For example, a Verisign seal helped BlueFountainMedia increase its form fills by more than 40%.
Arguably, the best way to include visible trust signals is to use an online payment gateway that shoppers already trust. For this reason, you may want to stick to big-brand payment gateways with good reputations, such as Stripe.
This way, your business can benefit from the payment gateway’s established reputation.
5. What is the payment gateway’s support like?
Finally, it’s worth considering each payment gateway’s support service. Whether it’s a disputed transaction or technical issue, it’s vital that you’re able to get help immediately when something goes wrong.
It’s also a good idea to choose a payment gateway that offers support via your preferred method, whether it’s email, live chat, or the phone.
You could also contact support before signing up to test the response time and experience the payment gateway’s customer service first hand.
Summary: How to choose an online payment gateway
These days, every business needs an ecommerce payment gateway to receive online payments.
Remember, ecommerce payment gateways can massively influence the customer experience — and consequently, your sales. Plus, it’s essential that you choose a reputable online payment gateway that’s PCI compliant to ensure it’s secure.
Level up with Neat
If you’re looking for a simple-to-use payment solution for your business, consider signing up for a Neat Business Account.
This multi-currency wallet allows you to accept card payments through Stripe. However, it also allows you to manage multiple currencies, make payments to staff and suppliers, and get a HKD Visa card to pay for expenses. Learn more now!