7 UK Payment Gateways Compared
Shopping for the best payment gateway options for your new e-commerce site may seem a little daunting, especially if this is your first site. The market has grown from just a handful of the big names to a whole host of new and innovative services over the last decade.
To make your decision a little easier, we’ve analysed and compared the top 7 gateways on the market at the moment from giants like PayPal and Sage to the fresh-faced smaller challengers like Braintree and Go Cardless.
So, even if you think you already know which service you’re going to choose, take a good look at the pros, cons and costs of each before you hit ‘Add to Shopping Basket’; you may discover something better.
The costs compared:
|Gateway||Set-up Fees||Monthly Fees||Transaction Fees|
|Paypal||£0||£0 / £20||1.9% + 20p|
|Sage Pay||£0||£19.90 / £45||12p per transaction*|
|Go Cardless||£0||£0 / £200||1% / 1p-60p|
Founded in 1998 as ‘Confinity’ and officially launched in 2002, PayPal was owned by eBay from 2002 to 2014 when it then split from eBay and became it’s own company.
As one of the longest standing online payment services and a household name thanks to it’s pairing with eBay, PayPal is widely trusted and used by retail giants such as Ted Baker, John Lewis and Argos.
- It’s super easy to set up. Chances are you already have a personal account, so all you’d need to do is upgrade to a business account and you’re away. If not, it takes just minutes to set up a new account.
- You can accept both credit card and PayPal payments, so your customers don’t have to have a PayPal account to buy from your site.
- PayPal is often viewed as a less professional payment method used by less established businesses, though you can customise advanced versions of the service to improve the purchasing experience.
- Transaction fees can get quite high if you have a large volume of sales per month
Parented by Advent International and founded in 1989 as ‘Streamline’, Worldpay is another name that has become synonymous with online payments worldwide.
Due to it’s high levels of security and flexibility, Worldpay’s services are used by big businesses across the UK such as Tesco, HMV and the British Heart Foundation, but are also ideal for SMEs and start-ups launching new e-commerce sites.
- Worldpay is fully compliant with PCI DSS data security standards and offer fraud screening to protect you from fraudulent payments.
- Unlike PayPal, prices with Worldpay can actually go down with higher volumes of sales rather than increase.
- Worldpay charge monthly fees for business accounts on top of other fees for PCI compliance management and a minimum monthly trading volume fee, so it can end up more expensive to use than other gateways
- There are long waiting periods including a 2-3 week wait for your account to be authorised following sign-up, and transfer delays of up to 4 weeks before you can access your money.
Recognised as one of the most trusted online payments companies in Europe, Sage Pay was founded in 2001, is part of Sage Group plc and was the first provider to introduce a simple, flat monthly fee for SMEs.
Due to it’s trusted name and easy-to-use software, Sage Pay is used by the likes of BBC Children in Need to collect their donations, and is also used by well-known brands like Krispy Kreme and OFFICE shoes.
- Sage don’t charge a % per transaction, just a flat 12p per transaction once sales have exceeded 350 transactions per month.
- Allows PayPal payments, providing extra choice for the user
- Good quality customer support and integrated online services
- Your account can take 3-5 weeks to be authorised and activated, and in some cases this can take up to 6 months.
A relative newcomer to the industry, Braintree is a subsidiary of PayPal and was launched in 2010. Despite being on of the new kids on the block, Braintree carries the well-trusted name of PayPal, which acquired the company in 2013 and gives it a little more clout on the market.
This trust is reflected in the recognisable brands that have used the service, which include mobile taxi app UBER, HungryHouse and the global smash hit app, Airbnb.
- Mobile-first technology, making mobile and in-app purchases easier
- Accepts 130+ currencies, all major credit and debit cards and even bitcoin
- Easy to use and highly customisable
- Relatively high transaction fees when compared with Stripe and Go Cardless
Younger still than Braintree, Stripe was launched in 2011 and was originally called /dev/payments until it became apparent that this was causing too much confusion.
Having received over $40 million dollars in investment during it’s first two years in operation, this independently owned payments service is used and trusted by retail giants such as Target, Best Buy and Adidas.
- Built with developers in mind so can be used to great effect by those with technical skills
- Lots of customisation options so you can tailor your customers’ shopping experience
- Not ideal if you’re not technically minded and may be difficult to use
- Does not provide 3D Secure so you’re at higher risk from fraudulent payments
Another fairly new arrival on the payments market, Go Cardless was launched in 2011 and specialises in making direct debit and recurring payments as simple as possible.
Due to it’s smaller size and lesser-known brand, Go Cardless isn’t often the first name that springs to mind when discussing payment gateways. Nevertheless, the service is used by a great many SMEs who find it useful for improving cash flow issues.
- Transaction fees are low for the standard account at just 1% and are capped at £2
- Payment collections are automated which reduces time spent on admin
- Not as well-known in the industry
- Pro account carries a £200 monthly charge
Skrill was originally launched in 2001 as Moneybookers, and only became Skrill in 2014, making it the youngest name on our list, but not the youngest company.
Owned by the Paysafe Group, Skrill is used and trusted by big names such as Skype, William Hill and Ladbrokes to name but a few.
- High levels of security and protection against fraud
- Easily integrates with other services and offers step-by-step guidance
- Has a reputation for giving poor customer service according to online forums
- Very high transaction fees compared to other gateways
Onsite v.s Offsite Payments
One thing you need to consider when deciding on which payment gateway to use is whether you want to handle payments on your own website, or whether you’ll redirect your customers to an external payment page.
Onsite payments may seem the obvious choice, as these give the impression of a more established and reputable company. Choosing onsite payments also means you can fully customise the checkout process and apply all of your own branding, which is great for keeping control over every aspect of your customer’s payment journey.
However, it is worth noting that onsite payments do have fairly steep cost implications due to the need to implement several security compliance measures. For example, all e-commerce sites that process payments onsite need to be PCI (Payment Card Industry) compliant and also hold a valid SSL certificate for the encryption of payment information.
Most SMEs and start-ups begin using offsite payments to reduce costs and pass on the important security responsibilities to the external payment handler. Some payment gateways, such as Sage Pay and PayPal, offer pro accounts and integration options to allow onsite payments in addition to the basic offsite payment option.
If you need help with setting up your new e-commerce site, we can help you right from the planning phase all the way through to choosing and integrating payment gateways and launching the site. Just give us a shout at firstname.lastname@example.org and tell us what you need.
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