(updated Aug 2019)
If you are setting up an e-commerce web site (shopping cart, online store, online shop), one of the decisions you will have to make is what system you are going to use for collecting payment. Payment can be handled off-line (by bank deposit, cheque, etc.) or automatically at the time of purchase by real-time credit card processing. In the case of off-line payment, the customer is provided with instructions for making a bank deposit or posting a cheque and the order is processed after payment is received. It is the simplest and least expensive system to set up but may present a barrier to some customers who are looking for the instant transaction that can be had using a credit card.
We should also mention POLi at this point. POLi allows instantaneous transfers from the buyer’s bank account to the merchant’s bank account. It can allow an instant transaction to take place with out as much cost as a credit card transaction. It requires a little more effort than a credit card purchase in that the customer has to log in to their bank account to complete the transaction but it’s much cheaper than a credit card transaction (at least 40% and more than that for larger transactions as fees are capped at $3).
When it comes to collecting credit card payments online in real time, there are two main types of systems:
- Third party (all in one) payment solutions
- Payment gateway linked to your own business merchant account