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 WooCommerce for WordPress or Virtuemart for Joomla! 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 and Stripe or Squarespace and Stripe/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.
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 August 2021)
| Name | Product | Fees | Notes |
| PayPal | Domestic | 2.6% + $0.30 per tran | Settles immediately, no merchant account required |
| PayPal | International | 3.6% + $0.30 per tran | Settles immediately, no merchant account required |
| PayPal | Domestic QR Code Transactions – $10.01 AUD and above | 0.90% + $0.10 per tran | Settles immediately, no merchant account required |
| PayPal | International QR Code Transactions – $10.01 AUD and above | 1.90% + $0.10 per tran | Settles immediately, no merchant account required |
| PayPal | Domestic and International QR Code Transactions – $10.00 AUD and below | 1.4% + $0.05 per tran | Settles immediately, no merchant account required |
| Squarespace | Business | $25.00 per month + 3% per tran | No merchant account required |
| Squarespace | Commerce | $34.00 per month | No merchant account required |
| eWay | Budget Plan | $30.00 per month plus 60c per tran – 5 free trans per month | Merchant account included – no bank required |
| Shopify – (Stripe integrated Payment Gateway) | Basic Plan | USD$29 per month + Stripe trans fees which are currently 1.75% + 30c per domestic tran | No merchant account required |
| Stripe | Integrated | Domestic : 1.75% + 30c and International: 2.9% + 30c | Provides payment gateway for shopping carts such as WooCommerce, Squarespace and Shopify, 7 day Settlement |
| SecurePay | Standard | 1.75% + $0.30 per domestic tran and $2.9% + $0.30 per international tran | No merchant account |
| SecurePay | Gateway Only – up to 3000 trans per year | $800 per year + $0.27 per tran | No merchant account |
| CBA | Commweb | Need to get a quote from the bank | Need a merchant account |
| NAB | Transact Plan | $30 per month up to $2,000 per month turnover. Over this amount starts charging 1.5% + $0.30 per tran | Need a merchant account |
| St George | eCommerce Solutions | Need to get a quote from the bank | Need a merchant account |
| Westpac | Hosted PayWay | Need to get a quote from the bank | Need a merchant account |
| ANZ | eGate | Need to get a quote from the ban | Need a merchant account |
Recommendation
If your shop is new and the 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 Squarespace or Shopify. 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.