How to accept payments online for your business

The exponential growth of digital payments and eCommerce in the UK have made it crucial for businesses to select quick, reliable, and convenient solutions to process payments online.

This in-depth guide will give you a comprehensive download of various methods, platforms and some of the best payment processors in the UK to accept online payments for your business.

Popular payment methods

Credit and debit cards

Credit and debit cards are one of the most widely used payment methods by customers who do not prefer to pay by cash. Payment processors like PayPal, Stripe, and Square allow businesses to set up a card transaction facility and accept card payments in a few easy steps.

Digital wallets

Digital wallets are one of the fastest-growing payment methods for quick and secure electronic transactions that can be performed effortlessly from a mobile device.

They operate on cutting-edge technologies like Near Field Communication (NFC) to enable instore and online payment processing. Digital wallet payment options can be integrated with point-of-sale systems and eCommerce sites. They store customers’ and merchants’ business information in a multi-layered, secure environment allowing users to seamlessly make and accept payments online through their mobile devices.

Popular digital wallets:

●     Apple Pay: Apple Pay is known for its security features and convenience of use on Apple devices. It secures transactions with tokenisation and biometric authentication (such as Face ID or Touch ID).

●     Google Pay: It’s the popular choice among Android users. GPay, as it’s commonly known, interfaces with a variety of Google services and provides a consistent payment experience across devices and platforms.

●     Samsung Pay: Samsung Pay uses both NFC and MST (Magnetic Secure Transmission) technologies, allowing it to work with a wider range of payment terminals.

Pay by bank

Open banking-powered pay by bank is another excellent method for accepting payments online. Customers can directly transfer funds from their bank account to merchants' accounts, bypassing the need for any intermediaries such as credit or debit cards. This mitigates the risk of data infringement and facilitates instant payments.

Bank transfers

A bank transfer is a safe method of transferring funds from one bank account to another, either within the same bank or between two different banks.

Traditional bank transfers, such as the BACS or the CHAPS, are still popular ways to accept payments online. Their robust security measures make them a trustworthy choice for high-value transactions.

Buy now, pay later (BNPL)

This innovative method allows customers to buy now and pay later in instalments. Players like Klarna and Afterpay have added to its growing acceptance, particularly among the younger generation.

Cryptocurrencies

Unlike fiat currency, cryptocurrencies are only available in the digital or virtual space. Powered by blockchain technology, they operate on decentralised networks and use cryptography for safe transactions, including peer-to-peer token transfers. Despite stringent regulations, cryptocurrencies like Bitcoin and Ethereum are gaining momentum as a new-age payment method. An increasing number of merchants are starting to accept online payments through cryptocurrencies in the United Kingdom.

Payment processing platforms

Point-of-sale (POS) systems

A POS system is an integrated platform comprising of hardware, software and payment services which enables businesses to accept payments for both online and in-person sales. It further assists in inventory management, sales tracking, and consumer data analytics.

For in-person transactions, Square, SumUp and others provide integrated hardware and software solutions for hassle-free POS transactions. Wonderful offers a “soft-POS” instant payment solution with its smartphone POS app, One by Wonderful.

Payment gateways

These are front-end technology platforms that process electronic payments for  e-businesses, online retailers and traditional brick and mortar businesses. They frequently integrate with e-commerce sites, mobile applications and POS systems, enabling businesses to accept online payments with ease.

Payment gateways such as Wonderful, PayPal, Venmo, and Revolut enable merchants to accept payments for both online and in-person sales in real-time.

How to accept online payments on your website?

Let’s take a quick look at the various options through which you can accept payments on your website before diving deeper into the integration process:

●     eCommerce platforms: These are software solutions which enable e-businesses to set up and operate their eCommerce stores with ease. They provide different types of payment integration allowing merchants to choose the one that best suits their requirements. WooCommerce, Shopify, and Magento are some prominent names in this field.

●     Payment gateways: Both eCommerce and brick-and-mortar businesses use these technology platforms to handle their digital transactions. They integrate with the point of sale and process payments by securely transferring encrypted transaction data to the payment processor or acquiring bank and relaying the authorisation response to the business. Wonderful, Square, PayPal, and Stripe are some popular examples.

●     Merchant accounts: Tailored specifically for merchants, these bank accounts accept credit and debit card payments along with a host of other methods. They are the bridge between your business bank account and the customer’s account. However, if your integrated payment processor offers the facilities of a merchant account, then you may not require one. We will explore all possibilities as we move ahead.

Choosing a payment gateway

Let's look at some key considerations that will guide you in choosing the right option for your business:

●     Security: If you are taking payments via card, confirm that the gateway adheres to PCI DSS standards and provides encryption and fraud detection.

●     Fees: Evaluate transaction fees, monthly fees, and any additional expenses. Most gateways have a pence-per-transaction fee but additionally charge of the sales value to process your payment, while Wonderful offers a cost-effective flat-fee model. Assess their service benefits in comparison to the commercial impact.

●     Integration: Determine whether the gateway integrates seamlessly with your eCommerce site. Stripe is renowned for its effortless integration with a diverse array of applications.

●     User experience: To prevent cart abandonment, the checkout procedure should be simple and seamless.

Setting up an account

Once you have made your choice, move on to the setup process. Typically, this includes sharing relevant business information, completing identity verification, and linking your merchant account.

●     Registration: The initial step is to register for an account on the website of the payment gateway. Fill out the required fields and submit your details.

●     Verification: To ensure your identity and the integrity of your firm, you must submit the required documents for verification, such as certificates of registration and tax identification.

●     Linking your bank account: To enable fund transfers, you must first link your bank account with the gateway. To do this, simply provide your bank account data.

●     Personalise: Make the payment UI seem like your brand to make it more user-friendly.

Integrating payment solutions

A vital step for accepting online payments is to integrate payment functionality into your eCommerce site or mobile application. Most gateways offer seamless integration through a customisable Application Programming Interface (API) or easy-to-integrate plugins. For instance, if you are using WooCommerce or Shopify, you can simply install the plugin and update your payment credentials in the configuration settings. Refer to the official documentation or the Software Development Kits (SDKs) provided by your payment processor for guidance. Payment processors like Wonderful come with robust support centres for further assistance.

Test-run the payment mechanism

To ensure that your customers do not encounter any glitches, it’s important to do test transactions to check if everything is in order. Errors, if any, should be rectified before you live with your payment solution. Follow the simple steps below, and you’ll be good to go:

●     Transaction Flow: Ensure that transactions are executed without any unintended bottlenecks.

●     Security: Sensitive information should have end-to-end encryption and not be exposed to probable cyber theft.

●     User experience: To guarantee that the consumer journey is user-friendly and intuitive, it is necessary to simulate it.

Launching and monitoring

Following the above steps, you can safely launch your eCommerce site. However, you must review the performance of your payment gateway to ensure that probable technical issues are rectified with minimum downtime. Continuously monitor transactions for abnormalities and be informed about any new features or upgrades from your payment processor. Review your transaction statistics on a regular basis to discover trends or potential problems, such as unusual chargeback rates or fraudulent efforts.

The above procedure will enable you to accept payments online through various payment modes, such as credit cards, Pay by Bank, traditional bank transfers like BACS and CHAPS, and BNPL (buy now, pay later).

How to accept online payments without a merchant account?

Payment processors like PayPal, Wonderful, and Stripe allow merchants to bypass the conventional merchant account and accept card or other payment rails, which aggregate transactions, eliminating the need for merchant accounts.

The benefits and drawbacks

Benefits:

●     Easier Setup: The process of setting up is typically more expedient and less complicated.

●     Reduced initial investment: There is no requirement for a dedicated merchant account, which can incur the price of setup as well as monthly fees. This results in lower upfront expenditures.

●     Streamlined management: The third-party processor is responsible for a significant portion of the backend payment processing and compliance, which simplifies management.

Drawbacks:

●     Long-run cost implications: When compared to regular merchant accounts, aggregation accounts typically come with higher transaction fees. This is because aggregation accounts are used to process more transactions.

●     Less Control: It is possible that you will have less control and flexibility over the process of making payments.

●     Probable delays in fund settlement: Third-party processors can hold funds for longer periods, particularly for new accounts or transactions that involve a high level of risk.

6 best payment processors

Let's take a look at some of the best and most trusted FCA-authorised payment processors. These evaluations will help you in choosing the right processor to accept online payments for your business.

Wonderful

Wonderful is an emerging name in this industry. Their cost-effective solutions integrate with various payment platforms and deliver an effortless checkout experience. Some of their key features are:

●     One App: This is one of the most budget-friendly point-of-sale (POS) applications. Merchants can accept payments online by generating tap-to-pay links and QR codes. It leverages the power of open banking to process transactions instantly over a safe network, and settle in real-time.

●     WooCommerce plugin: Wonderful’s WooCommerce payment plugin can be integrated with existing payment methods and offers a hassle-free checkout experience for your customers. Their ‘Plus’ plan comes at a remarkably affordable fee of £19.99 for 2000 monthly transactions. You only pay 1p per transaction for transactions outside your monthly bundle.

●     API integration: Wonderful's application programming interface (API) is very adaptable and easy to use for developers. It facilitates integration with unique apps and offers robust support for personalised payment solutions.

Razorpay

Razorpay has gained worldwide popularity due to its extensive feature set, which includes recurring payments, subscription billing, and an intuitive dashboard. Their USPs include:

●     Enriched functionalities: Accommodates a variety of payment methods, such as digital wallets, net banking, UPI, and credit/debit cards.

●     Customisation: Provides APIs for customised payment solutions and integrations.

●     Analytical insights: Offers comprehensive reporting and analytics tools to monitor and enhance payment processes.

PayPal

PayPal is one of the most widely acclaimed payment processors to accept online payments. Their free-to-install plugin merges perfectly with most eCommerce sites and provides a robust security mechanism. The PayPal advantage includes:

●     Strong reputation: Recognised and trusted by millions of users across the globe.

●     Buyer protection: Provides robust consumer protection policies, which can boost consumers' confidence and result in increased business volumes.

●     Adaptability: Allows businesses to accept payments online in a variety of ways, such as through bank transfers, rewards balances, and credit cards.

Stripe

Often a developer’s preferred choice, Stripe comes with a powerful API. Merchants with a global presence can benefit from their wide array of payment methods and currency acceptance. The following are the stand-out features of Stripe:

●     Customisability: Highly adaptable, with full API back-end support.

●     Worldwide reach: It's great for global enterprises because it supports many currencies and payment methods.

●     Additional features: Includes features to help with billing, subscription administration, and preventing fraud.

Square

Ideally suited for merchants searching for an all-in-one solution to accept payments online, Square provides a comprehensive POS system with easy navigation that augments the user experience (UX). The key advantages are:

●     Easy to install: Small enterprises will find the setup and operation straightforward.

●     Unified Integration: Offers a unified solution for both online and in-person transactions.

●     Additional services: Provides features such as inventory tracking, employee administration, and invoicing.

myPOS: Accept instant payments

An overview of myPOS

If you are seeking a comprehensive solution that works seamlessly across online and in-person platforms, then myPOS is the ideal choice. Its feature-rich offer includes instant payments, multi-currency accounts, a reasonable fee structure and a wide range of payment methods. The biggest advantage for businesses with brick-and-mortar outlets is that myPOS also facilitates in-person transactions.

Setting up your myPOS payment plugin

●     Register your business: Register on the myPOS website and furnish your business information.

●     Select payment devices: myPOS provides a variety of payment devices, including POS terminals and card readers, for in-person transactions.

●    Payment Integration: Utilise the integration tools provided by myPOS to incorporate payment functionality into your eCommerce site. This may encompass the integration of APIs for custom sites or plugins for prominent eCommerce platforms.

●     Accept payments instantly: myPOS ensures that funds are accessible promptly upon the completion of a transaction.

Conclusion

By understanding the significance and the integration process of robust payment solutions, your business can deliver fantastic payment experiences, make significant savings on processing fees and maximise revenue generation.

Select a suitable payment processor that complies with regulatory mandates and provides a seamless checkout experience across various channels. Explore various options like Wonderful, Stripe, Square, and PayPal to assess the best fit for your business and make an informed decision.

FAQs

When starting a new business, how do I accept payments online?

Setup a payment gateway, create a merchant account, integrate a variety of payment methods, such as digital wallets and credit and debit cards, and guarantee secure transactions through the usage of SSL certificates and PCI compliance.

What is the safest way to accept payments online?

Trusted payment gateways like Wonderful, PayPal, Stripe, etc. are compliant and use modern technologies to provide robust data protection. You should verify their encryption mechanisms, fraud detection capabilities, and regulatory compliance before engaging with them.

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