Top 5 considerations when choosing a payment processor

Feb 24 2022 | PayPal Editorial Staff

Deciding on a payment processor is one of the most important decisions which will impact the success of your business operations. Here are five important qualities to consider.
Enterprise-level businesses need to transact high-volume payments across different channels and geographic locations. The entire process must be secure and seamless to provide a safe and enjoyable experience for customers, which is why choosing a suitable payment processor is possibly one of the most important decisions you have to make and one which will impact the success of your business operations.

Choosing a payment processor may seem daunting and complicated if you do not know what to look out for. A simple search on Google can yield dozens of providers with many promising the best solutions. Faced with numerous choices, how do you decide which third-party payment processor is the best fit for your unique business needs? In this article, we conducted extensive market research and narrowed down to five critical features your payment partner should offer for your business to thrive in this ever-shifting eCommerce environment.

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1. Provides a seamless checkout experience

In 2019, almost 70% of digital shopping carts worldwide were abandoned before the purchase could be completed due to poor checkout experience.1 Shoppers do not like complicated procedures when they plan to make a purchase, especially when they are shopping on a phone or tablet. Consumers are keen to engage in the digital economy but some still have concerns when shopping online, such as apprehensions about transacting on mobile devices, buying across borders, making expensive purchases and buying from unfamiliar merchants. According to an Ipsos study, 30% of consumers indicated that they would abandon a purchase if they were unable to locate their preferred payment method online.2 Our research showed that shoppers from the UK, US, Germany, Australia, Italy, Spain and Brazil were more likely to purchase from an online business that offers PayPal. The study also suggests a 54% increase in consumer willingness to buy when PayPal is available as a checkout option.

A seamless checkout experience, complemented by a wide selection of payment methods, is vital to boosting conversion rates and encouraging repeat purchases on your eCommerce site. PayPal Commerce Platform for Enterprise, for instance, enables your customers to achieve faster checkouts across different channels in fewer clicks through optimised cloud-based processing. There are also plenty of payment options for them to choose from – including credit and debit card payment, PayPal Checkout, and mobile wallets such as PayPal Wallet, all accessible via a single payment processor integration. You need a reliable global payments partner that enables your customers to pay the way they want to, without leaving your webstore.

The more you know about your customers’ buying behaviour, the better you can plan your marketing approach to meet their needs. PayPal’s in-depth reporting and analytics capabilities enable you to leverage shopper data and insights to create marketing programmes with greater effectiveness and precision. PayPal’s Insight reports, for instance, deliver analysis of your business, far richer than simply indicating the size and volume of transactions. Through our comprehensive reports, you can determine the geographic location of customers worldwide as well as client demographics, such as gender, age and income bracket, together with their PayPal score based on history and reputation. Go deeper by analysing whether they are new or returning customers, and if sales conversion rates were made through mobile or desktop devices.
 

2. Accepts different currencies and offers local payment options

Enterprise merchants are setting their sights on global expansion as eCommerce and mobile payment technology continues to break down borders. However, differing regulatory and compliance laws in this evolving global landscape can act as barriers, and make expansion a costly and labour-intensive endeavour. For example, if a merchant is unable to accept payments in a local currency, customers are likely to seek out another merchant who can.

To offer global customers a localised shopping experience, consider a payment processor which accepts and processes payments in more than 200 countries and over 100 currencies. PayPal Commerce Platform for Enterprise allows merchants to access over 400 million active PayPal users globally.3 Leverage our technology and tools to manage risk, mitigate friction at checkout and more importantly, maintain the trust of your customers. We also offer popular local payment options like WeChat Pay, AliPay and JCB. Use our global knowledge and established local relationships to your advantage and receive the support you need to grow your business worldwide
 

3. Improves your business’ flexibility and scalability

Payment processing for businesses is evolving rapidly within the eCommerce ecosystem and offering payment methods which are currently popular among customers is not enough. Your enterprise should be able to operate and meet different market demands while maintaining the flexibility to include new payment options when they become available. In other words, you will want a scalable payment platform – one that enables your business to adapt to changing market conditions and customer needs without creating new problems for developers.

Attempting to integrate multiple technologies can be a complicated process. Businesses using PayPal can easily add new payment options by inserting just a few lines of code. As your business grows and customer preferences change, you can use PayPal to add more features such as native purchases from third-party partners, recurring payments and subscriptions, and more. These can be achieved with just one integration and a single account for the settlement of funds. Additionally, our customisable software development kit (SDK) allows your enterprise to scale seamlessly across new channels and markets without adding to your tech stack.

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4. Increases your operational efficiency

When you are handling different gateways and multiple payment processors, trying to obtain a comprehensive view of your payments data can pose a challenge. You will also need to consider the time and resources required to train employees and manage each platform. Attending to chargebacks is another time-consuming process which inhibits your team from focusing on more strategic tasks. For your business to scale effectively, the efficiency of your payment process must be optimised as much as possible.

By making more data-driven decisions, PayPal Commerce Platform for Enterprise helps to minimise the burden of back-office operations. Our user-friendly dashboard offers comprehensive reporting for all your payments, including disputes and verifications down to the transaction level – all in one location. Our Resolution Centre, for example, makes it easier for both buyers and sellers from around the world to communicate and resolve disputes from your account dashboard. For greater peace of mind, we also provide personalised support for chargebacks and filing disputes, plus, we make it easy to integrate third-party tools to help you manage the chargeback process.
 

5. Simplifies compliance and mitigate risk

Compliance and fraud protection are fundamental to both your business operations and your brand’s reputation. Enterprise merchants handle up to millions of transactions each year, and as a result, fraud regulations which are too stringent can reject legitimate transactions, pushing potential customers elsewhere. To control these costs, leading payment processors often provide proactive fraud-management tools to help enterprises make fast and informed decisions about dubious transactions and formulate rules to meet their individual needs.

PayPal Commerce Platform for Enterprise provides businesses with all the tools they need to manage risk. Powered by industry-recognised best-in-class fraud prevention technology, Simility, PayPal Fraud Protection is a next-generation application which helps enterprises detect fraud through the use of machine-learning technology without affecting authorisation rates. Simility analyses ever changing global fraud trends in real-time to help optimise the entire system, while allowing enterprise merchants to set their own rules across different channels and markets. PayPal also uses the latest security protocols such as network tokenisation and encryption to help your business fight fraud.

As a PCI DSS (the highest industry standard) compliant service provider, PayPal Commerce Platform for Enterprise can help businesses with their eligibility for SAQ A-level PCI compliance validation. With capabilities in more than 200 markets, PayPal Commerce Platform for Enterprise can assist you with compliance and regulatory requirements, regardless of where you conduct your business. What’s more, PayPal’s fraud detection and monitoring remain active round the clock, seven days a week. Every transaction – big or small – is monitored for fraud such that your enterprise can experience higher authorisation rates at 90% (300 basis points above industry standards)4 and lower payment fraud losses as well.
 

In summary

Simplicity, security and seamlessness are some of the qualities your payment processor should be able to provide. Consumers do not like to waste time trying to figure out how to make their payments online. Whether they are using desktops, smartphones or tablets, they want an intuitive user interface, fewer clicks, and easy payment options that do not require keying in credit or debit card numbers each time they make a purchase.

PayPal Commerce Platform for Enterprise makes it easy for you to design and optimise your customers checkout experience across different channels and devices. As one of the world’s leading payment platforms, PayPal offers digital wallets, credit and debit cards as well as alternative payment methods which allow your customers to select their preferred way to pay wherever they are, and as a result, making it easier and more convenient for them to complete their online purchases.

As you grow your business, you will need a scalable, secure and comprehensive platform to meet your enterprise’s needs. With PayPal Commerce Platform for Enterprise, you get to enjoy more options and control as you navigate this changing world of eCommerce with the necessary tools to keep you ahead of consumer and economic trends. And to protect your business, we have a customisable and comprehensive suite of anti-fraud tools, which include chargeback automation, real-time fraud prevention and AI-based risk intelligence services.

To sum up, payment processing should enhance your customers’ shopping experience, not act as a barrier. From the shopping cart to the backend stages, every aspect of the payment process needs to be optimised to help you drive conversions and increase your revenue. PayPal Commerce for Enterprise helps you achieve your business goals with ease. Discover how you can embrace this new era of payments and commence your journey towards frictionless eCommerce here.

The content of this article is provided for informational purposes only. You should always obtain independent business, tax, financial, and legal advice before making any business decision.

Sources:

1 Statista, Online shopping cart abandonment rate worldwide from 2006 to 2019, March 28, 2019.

2 Online study commissioned by PayPal and conducted by Ipsos MORI Conjoint Research in October 2018. Survey conducted across seven markets (UK, Germany, Italy, Spain, US, Australia, Brazil) with 1,500 respondents per market/10,500 total respondents, including 6,930 PayPal users.
https://www.paypal.com/hk/brc/article/people-are-more-willing-to-buy-when-business-accepts-paypal

3 PayPal Reports Third Quarter 2020 Results, November 02, 2020.

4 PayPal commissioned study. Authorization rates benchmarked against major payment networks in US, UK, Australia, France, Spain over 3 months (April–June 2019). Based on first presentment.
The contents of this site are provided for informational purposes only. The information in this article does not constitute legal, financial, IT, business or investment advice of any kind and is not a substitute for any professional advice. You should always obtain independent, professional accounting, financial, IT and legal advice before making any business decision.