Selecting a payment processor can feel overwhelming, with countless options and ever-evolving features. But choosing the right one doesn’t have to be complicated. To help you navigate the landscape, we’ve put together this quick guide highlighting key factors to consider and how to pick the best payment provider for your business.
What do we mean when we say payment processor or payment gateway?
While a payment processor, typically, only handles moving money between banks and can't authorize transactions on its own, a payment gateway provides both the secure authorization and processing capabilities, acting as the bridge between merchants and processors. In simpler terms, the gateway is the secure "front door" that collects and protects payment data, while the processor is just the "delivery service" moving money between accounts.
PayPal has a great breakdown: What is a payment gateway and how does it work?
Key Factors to Consider When Choosing a Payment Processor
Selecting the right payment processor is essential for any eCommerce business. Beyond accepting payments, the ideal provider should support seamless transactions, enhance customer trust, and adapt to your business needs. Here are the critical factors to evaluate when choosing a payment processor for your online store:
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PCI DSS Compliance
PCI DSS (Payment Card Industry Data Security Standard) compliance ensures that businesses handle credit card information securely, reducing the risk of fraud and data breaches. Choosing a payment processor that is PCI-compliant is essential for protecting customer data and maintaining trust. -
Dynamic Card Updates and Dual Vaulting
To avoid disruptions with subscriptions or recurring payments, some processors support dynamic card updates. This feature automatically refreshes customers’ expired or updated credit card information, ensuring seamless billing.Dual vaulting means card data is securely stored both within UltraCart and the payment processor’s system. This allows businesses to switch payment providers without needing to collect customer payment details again, ensuring flexibility and continuity. -
Alternative Payment Solutions
Offering a range of payment methods can significantly increase conversions. Look for processors supporting alternatives like:Apple Pay & Google Pay
Buy-now-pay-later services (e.g., PayPal Pay Later)
One-click or express checkouts (e.g., Fastlane by PayPal)
Digital wallets like Venmo and Link by Stripe -
International processing
If you sell internationally, ensure your payment processor supports global transactions. Look for features like multi-currency support and transparent currency conversion rates to reduce additional costs. -
Subscriptions
If your store offers subscription-based products or services, verify that your processors alternative payment methods support recurring billing. Not all alternative payment methods can handle subscriptions, so choose a payment provider that optimizes subscription payment methods.
Choosing the Right Payment Provider for Your Business
Finding the best payment provider depends on your business model, customer preferences, and growth goals. Each provider offers unique features that can impact how you manage payments, subscriptions, and international sales. Here's a comparison of top payment processors to help you make an informed decision.
PayPal
PayPal offers one of the most comprehensive payment solutions available. It supports seamless checkout with major credit cards, PayPal accounts, and popular digital wallets like Apple Pay, Google Pay, and Venmo. PayPal also provides Pay Later options such as PayPal Credit and Fastlane for quicker checkouts. Its broad acceptance and flexible payment options make it ideal for businesses targeting both domestic and international customers.
Key Features:
- PCI Compliance: Yes
- Dynamic Card Updates & Dual Vaulting: Yes
- Payment Solutions: Credit Cards, Apple Pay, Google Pay, Venmo, PayPal, PayPal Pay Later, Fastlane by PayPal
- Subscriptions: Supported for all payment methods
- International Payment Processing: Yes (Fastlane by PayPal is US only)
Stripe
Stripe is a robust payment platform designed for modern eCommerce. It supports a wide range of payment methods, including credit cards, Apple Pay, Google Pay, Link by Stripe, and even Amazon Payments. With built-in PCI compliance, dynamic card updates, and dual vaulting, Stripe ensures security and seamless recurring billing for subscriptions. Its global reach makes it perfect for international sales.
Key Features:
- PCI Compliance: Yes
- Dynamic Card Updates & Dual Vaulting: Yes
- Payment Solutions: Credit Cards, Apple Pay, Google Pay, Link by Stripe, Amazon Payments
- Subscriptions: Supported
- International Payment Processing: Yes
Authorize.net
Authorize.net is a trusted payment gateway offering secure credit card processing. It supports recurring billing for subscription-based services and features PCI compliance, dynamic card updates, and dual vaulting for better security. With international payment processing, Authorize.net is suitable for businesses looking for a reliable and secure payment infrastructure.
Key Features:
- PCI Compliance: Yes
- Dynamic Card Updates & Dual Vaulting: Yes
- Payment Solutions: Credit Cards
- Subscriptions: Supported
- International Payment Processing: Yes
QuickBooks Payments
QuickBooks Payments simplifies payment management by integrating directly with QuickBooks accounting software. It supports credit card payments with PCI compliance but lacks features like dynamic card updates. Its international payment processing capability makes it a good fit for businesses already using QuickBooks for financial management.
Key Features:
- PCI Compliance: Yes
- Dynamic Card Updates & Dual Vaulting: No
- Payment Solutions: Credit Cards
- Subscriptions: Supported
- International Payment Processing: Yes