To start accepting online payments from your website you need:
- A shopfront or online catalogue
- Access to a Payment Gateway that will securely accept the credit or debit card used to make the payment and ensure the funds are removed from your customer’s account and placed into yours.
Shopfronts
Depending on the software used to run your site an online catalogue such as Woo Commerce for WordPress or Virtuemart for Joomla! websites can be installed. These solutions require your web developer to integrate the shop front with a Payment Gateway.
There are some companies that provide the shopfront and Payment Gateway already integrated such as Shopify Payments and Stripe, or Big Commerce and PayPal. This type of solution does not require a merchant account and generally allows you to be up and running quickly.
Do you need a merchant account?
A merchant account is a special bank account that exists for the purpose of holding funds captured from credit and debit card sales. These funds are transferred to a normal business bank account at the end of each business day. Most Payment Gateway providers will require you to have a merchant account. A merchant account must be applied for and approved by the bank. Here is a great article explaining how to apply to your bank giving yourself the best chance of success.
https://www.shopify.com.au/blog/6614567-how-to-ensure-your-merchant-account-application-is-approved
An online payment solution which includes a merchant account means:
- Reduced fees per transaction
- Same day settlement
- Bank must approve the account
- Potential for setup fees.
PayPal, Shopify Payments and Big Commerce are some solutions that do not require you to have a merchant account. If you want to be up and running quickly and are just starting out it makes sense to pay the higher transaction rates associated with these solutions. Once you have a better idea of the volume of transactions then you can look for cheaper solutions.
Credit Card Processing
Payment card industry-data security standards (PCI-DSS) Compliance
Security is a big deal when running an ecommerce website. In the world of hackers you need to ensure that you are PCI-DSS compliant. The most important way you can achieve this is:
- Do not store credit card information on your website
- Ensure that your customer’s credit card information is passed through to the Payment Gateway using a Secure Socket Layer (SSL) link
- Have a privacy policy on your website
- Ensure that the Payment Gateway is PCI-DSS compliant
Costs Associated with Payment Solution Providers (as at July 2018)
| Name | Product | Fees | Notes |
| PayPal | Domestic : 2.6% + $0.30 per tran
Internat’l : 3.6% + fixed fee |
Settles immediately | |
| eWay | 1.9% + 20c per tran | Merchant account included – no bank required
|
|
| Stripe | Domestic : 1.75% + 30c
Internat’l: 2.9% + 30c |
7 day Settlement | |
| Shopify Payments – (Stripe integrated Payment Gateway) | Basic Plan | USD$29 per month
1.75% + 30c per tran |
No merchant account required |
| Big Commerce (PayPal integrated Payment Gateway) | Standard up to $50k | $29.95 per month
|
No merchant account required |
| Squarespace | Basic | $34 per month (paid annually). | No merchant account required |
| Payment Express | Starter | $150 setup
$50 per month 100 free trans then $0.50 per tran |
Need a merchant account |
| SecurePay Online Payments |
2.4% on domestic Visa and Mastercard
|
No merchant account | |
| CBA | Commweb | $10.00 per month
1.4% per tran + $0.29. |
Up to $12,000 monthly turnover
|
| Merchant Warrior | Basic (up to 40 trans/month) | $33 per month
$0.45 per tran |
Need a merchant account |
| NAB | Transact Plan |
$40 per month with $2,000 monthly card turnover Additional fee per transaction $0.30 |
Need a merchant account |
| St George | Hosted Payment Page | Annual admin fee $44.00 plus
monthly admin fee $33.00 (min $27.50) Trans fee – 1.1% |
12 month contract
Need a merchant account
|
| Westpac | Hosted PayWay | Payway charges $220 for setup plus $44.00 per month plus trans fee of $0.22
WBC charge $110.00 for setup plus $22.00 per month plus trans fee of 0.5% Mastercard/VISA interchange fees – 0.3-2.2% more for premium cards 12 month contract |
Need a merchant account |
| Westpac | eWay interface | WBC charge $104.50 cancellation fee | |
| ANZ | eGate | $99 setup
Minimum Monthly Merchant Service Fee $29.00 Visa/MasterCard 1% per tran fee. |
Need a merchant account
|
Recommendation
If your shop is new and volume of transactions low then it is generally recommended that you start off with one of the solutions that do not require a merchant account. Add a shopping cart/online catalogue to your site and process the payments using PayPal, or use the shopping carts/online catalogue’s supplied by Shopify Payments or Big Commerce. Your transaction fees will be higher but you can be up and running without waiting for bank approvals.
Once you have a track record and know the volume of transactions you are processing then consider partnering with a Payment Gateway or select the most cost effective Bank solution. The table above has been compiled to give you a rough idea of costs.
