Payment gateways are the key link between business sales and the banks that process transactions. They allow customers to enter their payment information securely so you can make money from online sales.
The best payment gateways make the process as easy as possible, both for the consumer and the merchant. You’ll need one with low fees, a simple user experience, top-notch security and great customer service.
In this guide, I’ll show you my top payment gateway choices on the market, explaining their pros and cons and who I feel they’re appropriate for.
If you’re short of time:
- Square is the best payment processor for those who offer in-person payments and want a simple solution. Learn more on their website.
- Worldpay is the best payment processor for scalability
- Shopify Payments: is the best payment processor for Shopify Users
Compare the 9 Best Website Payment Gateways
In my detailed review of the top payment gateway, I looked at factors like versatility, ease of use, global reach, and support for various payment methods.
Based on my research, the best payment gateways for businesses are Square, Stripe, PayPal, Worldpay, Adyen, Amazon Pay, Shopify Payments, Opayo (formerly Sage Pay), and Braintree. These providers offer distinct strengths and can meet the different needs of businesses.
|Payment Gateway||Stars||Best For||Pros||Cons||Visit|
|Square||⭐⭐⭐⭐⭐||Microbusinesses||Easy to use. Good for small businesses. Built-in analytics.||Not the cheapest. Lacks multi-currency support.||Square|
|Stripe||⭐⭐⭐⭐||Online businesses, customization||Customizable. Global reach.||Complex for non-technical users. Costly for micro-transactions.||Stripe|
|PayPal||⭐⭐⭐||Brand recognition||Trusted brand. Easy setup.||High fees. Account freezing issues reported.||PayPal|
|Worldpay||⭐⭐⭐⭐||Global payments, large volume||Global reach. Customizable. Detailed analytics.||Complex features. Tiered pricing can get costly. Long contracts.||Worldpay|
|Adyen||⭐⭐⭐⭐||Global enterprises||Multi-currency. Cross-channel consistency.||Complex pricing. Steep learning curve.||Adyen|
|Amazon Pay||⭐⭐⭐⭐||Leveraging Amazon’s platform||Increased conversion. Lower cart abandonment.||Limited customization. Dependency on Amazon ecosystem.||Amazon Pay|
|Shopify Payments||⭐⭐⭐⭐||Shopify merchants||Unified experience.||Limited to Shopify users. Restricted availability. Currency conversion fees.||Shopify Payments|
|Opayo||⭐⭐⭐||Security-focused businesses||Broad payment options.||Complex setup. Not as seamlessly integrated.||Opayo|
|Braintree||⭐⭐⭐⭐||Feature-rich solutions||Feature-rich. Seamless experience.||Overkill for small businesses. Accumulating fees.||Braintree|
9 Best Payment Gateways and Online Payment Systems 2023
Square: Best Payment Gateway for Microbusinesses
Square is an all-in-one solution for payment processing. They offer card readers and EPOS machines as well as simple payment gateways you can integrate with all major e-commerce systems.
Set up a free online store, process payments via social media, or even customise your setup with their free APIs and SDKs.
Connect with Wix, Weebly, Ecwid, BigCommerce, 3dcart, Drupal Commerce, WooCommerce, and Magento with a simple plugin or APP.
Square works with any UK-issued and most international tap, chip and PIN, magnetic stripe cards with a Visa, MasterCard, American Express, Maestro, Visa Electron or Vpay logo.
- The user interface is so intuitive that even the most tech-averse can navigate it with ease.
- The hardware variety caters to all—from the countertop register to the pocket-sized mobile card reader.
- The pricing is transparent; you know exactly what you’re going to be charged per transaction, and there are no nasty surprises.
- Analytics and reporting are baked right into the dashboard, allowing businesses to gain actionable insights without needing a separate platform.
- For businesses churning through high transaction volumes, Square will not be the most cost-effective.
- International businesses may find the lack of multi-currency support limiting.
Square Pricing & Fees
Square’s pricing is simple.
For in-person transactions, it’s 1.75% per swipe or tap, and for online transactions, it’s 2.5%. No setup fees, no monthly charges; it’s as straightforward as it gets.
You do pay slightly more for it’s sheer simplicity. Stripe, by comparison, charges 1.5% + 20p for online transactions.
Who Should Use Square?
If you’re a micro business looking for a no-fuss, reliable payment gateway, Square should be on your shortlist. The service is excellent for those who want an all-in-one solution for payments, inventory, and even customer relationship management.
It gets my top vote for best entry level card reader.
Stripe: Best Payment Gateway for Competitive Fees
Stripe is an excellent choice for businesses that require a multi-functional platform capable of handling subscriptions, invoices, and even fraud protection. For those looking to expand globally, Stripe’s support for multiple currencies and payment methods is a significant advantage.
However, the platform’s extensive range of features can also be a drawback, particularly for smaller businesses that may find themselves paying for functionalities they don’t necessarily need. Stripe’s pricing model, while transparent, can become costly as you add more advanced features or if you process large volumes of transactions.
Another point of consideration is the technical expertise required for maximising Stripe’s full potential. While it offers pre-built solutions for those without a technical background, businesses looking to customise extensively may need a skilled developer. This could add an additional layer of cost and complexity.
Lastly, while Stripe does offer a variety of pre-built integrations, your current software stack may not be fully compatible, necessitating additional time and resources for custom integration.
- Extensive API Accept payments in over 135 currencies.
- High Scalability
- May not be suitable for non-technical users.
- Costly for Micro-Transactions
Stripe Pricing & Fees
Stripe offers a pay-as-you-go pricing model. Domestic transactions are charged at 1.5% + 20p for European cards and 2.5% + 20p for non-European cards. There are no setup or monthly fees.
Using a payment link is more cost-effective at 1.2% + 20p for all UK cards.
Additional services like subscriptions or international payments come with their own pricing.
Who Should Use Stripe?
Stripe is well-suited for online businesses that require a flexible, scalable payment solution. It’s particularly beneficial for companies with a global reach due to its multi-currency support. Moreover, its rich API environment makes it an excellent choice for those comfortable with custom coding.
PayPal: Best Payment Gateway for Brand Recognition
PayPal is one of the most widely recognized and used payment gateways in the world and a very reliable way to take payments. PayPal’s broad adoption offers instant credibility for merchants, along with a range of features from invoice creation to subscription billing.
I wouldn’t suggest you use PayPal as your only payment gateway simply because the fees are amongst the highest. But it’s useful as a secondary integration because it’s so commonplace. It also supports over 200 currencies and accepts payments from over 200 countries.
- Consumer Trust: PayPal is well-known and widely trusted, potentially increasing conversion rates.
- Versatility: Suits businesses of all sizes and types, with various options for payment acceptance.
- Easy Setup: Intuitive and straightforward, requiring minimal technical skills.
- Higher Transaction Fees: Generally, PayPal’s fees are on the higher side compared to competitors.
- Account Freezing: There have been reports of sudden account limitations or freezes, affecting cash flow.
PayPal Pricing & Fees
PayPal levies a fee of 2.9% plus £0.30 per transaction for domestic sales within the UK. For international transactions, the rate climbs to 4.4% per transaction, in addition to a fixed fee that varies depending on the currency involved.
While there are no initial setup or ongoing monthly fees, additional charges may be incurred for services such as chargebacks.
Who Should Use PayPal?
Given its ubiquity and ease of use, PayPal is suitable for both any type of business. It’s particularly useful for those who wish to reach a broad, international customer base, given PayPal’s widespread recognition and trustworthiness.
PayPal vs. Competitors
In contrast to Stripe’s focus on customizability and API options, PayPal offers a ready-to-use solution that appeals to businesses seeking to get started quickly. However, its fee structure makes it potentially more expensive for micro-transactions.
Worldpay: Best Payment Gateway for Diverse Payment Methods
Worldpay is a comprehensive global payment gateway, serving over 146 countries and offering more than 300 payment methods. Apparently they process some 26 million transactions a day, and they are certainlyt one of myt top providers.
They’re secure, great for multi-currency support, and can help your business offer card payments, online payments, mail and phone payments with ease. Choose from pay-as-you-go or pay monthly, and you’ll also get excellent customer servive which receives consistently good reviews.
The pay as you go rates aren’t the cheapest (2.75% of each transaction plus a fixed fee of £0.20) but it gets more competitive once you go onto a contract. That said, their contracts are quite long: typically a standard three-year contract with an auto-renewal clause that means you’ll be signed up for an additional year at the end.
- Global Reach: Extensive support for international transactions, including a plethora of currencies and payment methods.
- Security Measures: Advanced fraud protection and secure data encryption.
- Comprehensive Reporting: Provides detailed analytics and transaction reports for deeper business insights.
- Complexity: The platform’s extensive features can be overwhelming for small businesses.
- Fees: Costs can accumulate through a tiered pricing structure and additional service fees.
Worldpay Pricing & Fees
Worldpay has a complex pricing model that can be customized based on your specific business needs. Typically, businesses will encounter a setup fee, monthly fees, and variable transaction charges depending on the payment methods used. Exact details require consultation with Worldpay.
Who Should Use Worldpay?
Worldpay is the right choice if you’re happy to enter into a contract for at least three years. It’s a huge and reliable company used by over 250,000 UK SMEs, and probably the best for integrations. Be warned that if you leave the contract early, they will still charge you the full amount.
Adyen: Best Payment Gateway for Risk Management
Adyen is a huge global payment company based in the Netherlands. Often considered a competitor to Stripe, is one of Europe’s largest fintech with a market capitalization of approximately 23.4 billion. They’re an all-in-one payments processor that delivers payments over online, mobile and in-store channels.
Adyen is a good solution for a large firm because it has a larger global network of banks and acquirers than Stripe or Worldpay. It also has very sophisticated risk management system and a scalable infrastructure. They handle high volumes of transactions for some of the world’s largest companies, such as Spotify, Uber, and Airbnb.
- Multi-Currency Support: Adyen offers the ability to accept payments in over 150 currencies.
- Cross-Channel Consistency: Provides a unified payment experience across online, mobile, and in-store environments.
- Advanced Analytics: Offers real-time reporting features that provide deep insights into payment performance.
- Complex Pricing: The pricing model may be difficult to understand, with interchange fees and other variables.
- Steeper Learning Curve: Given its robust set of features, it may take time for businesses to fully exploit its capabilities.
Adyen Pricing & Fees
Adyen employs a blended pricing model that includes a processing fee and a payment method fee. The exact cost can vary depending on the payment methods used, transaction volume, and other factors. Overall they are competitive but not suited to micro businesses.
Who Should Use Adyen?
Adyen is a great fit for mid-to-large enterprises that require a multi-currency, multi-payment method solution, particularly those that operate in multiple markets. Its advanced analytics features also make it suitable for businesses focused on data-driven decision-making.
Amazon Pay: Best Payment Gateway for Conversion
Amazon Pay stands out as a top choice for boosting conversion rates on your e-commerce site. With such a huge proportion of online shoppers already having Amazon accounts with saved payment details, they can checkout process faster and easier, reducing cart abandonment.
The familiar Amazon branding also adds a layer of trust, encouraging more customers to complete their purchases. Overall, its streamlined and trusted platform can significantly help in converting browsing into actual sales.
It’s worth pointing out Amazon Pay is focused on online payment solutions and doesn’t offer any card readers or Electronic Point of Sale (EPOS) systems. It’s designed to integrate with your online storefront to facilitate smooth transactions, rather than handling in-person sales.
- Seamless integration into the Amazon ecosystem, beneficial for businesses targeting Amazon’s large and loyal customer base.
- Lower cart abandonment rates owing to streamlined checkout processes.
- High-level security features, backed by Amazon’s robust fraud protection.
- The service may not be the most cost-effective for smaller businesses.
- Limited customisation options compared to other gateways.
- Heavy dependency on the Amazon ecosystem could be a drawback for some.
Amazon Pay Pricing & Fees
- Transaction fees vary based on the country but generally range from 2.9% + £0.30 per transaction.
- No monthly fees or setup costs.
Who Should Use Amazon Pay
This payment gateway is particularly beneficial for established online businesses that want to leverage Amazon’s extensive user base and are looking for a highly secure, trusted payment solution.
Shopify Payments is the native payment gateway for the Shopify e-commerce platform. Engineered for seamless integration with Shopify stores, it streamlines the payment process, making it simpler for business owners to manage transactions within the Shopify interface.
- Full integration with Shopify makes for a unified administrative experience.
- Competitive transaction fees when operating within the Shopify ecosystem.
- Advanced fraud analysis tools are included.
- Limited to Shopify users, thereby excluding businesses that operate on other e-commerce platforms.
- Restricted availability in certain countries and for some types of business.
- Currency conversion fees can add to costs for international transactions.
Shopify Payments Pricing & Fees
- Standard Shopify charges apply, starting at 2.9% + 30¢ per transaction for the basic plan.
- Additional fees for international transactions and currency conversions.
Who Should Use Shopify Payments
Businesses that are already using or planning to use Shopify for their online store will find Shopify Payments to be an extremely convenient solution, designed to function seamlessly within the Shopify platform.
Opayo, formerly known as Sage Pay, is a payment service provider based in the UK that offers a range of payment solutions, including online card processing, phone payments, and invoice payments. It’s known for its strong security features and compliance with high-level encryption and anti-fraud protocols.
- Offers a broad range of payment options, from online and mobile to over-the-phone transactions.
- Strong security measures, including PCI DSS compliance and robust fraud prevention tools.
- No hidden fees; pricing structure is transparent and straightforward.
- Initial setup can be complex and may require some technical skills.
- Not as seamlessly integrated into all e-commerce platforms compared to other providers.
- Charges for some additional services can accumulate.
Opayo Pricing & Fees
- A flat monthly fee starting from £19.90 per month for up to 350 transactions.
- Custom pricing available for larger businesses requiring a greater volume of transactions.
Who Should Use Opayo
Opayo is best suited for UK-based SMEs that require a variety of payment options and prioritize security. It’s also a good fit for businesses that prefer a flat monthly fee to a per-transaction cost.
Braintree is a full-stack payment platform known for its ease of use and seamless integration capabilities. Owned by PayPal, it provides a range of features such as mobile payments, subscription billing, and foreign currency acceptance. The platform is designed to make complex payment needs simple, allowing businesses to focus more on their operations and less on payment processing.
- Robust suite of features, including mobile payments, recurring billing, and multiple currency options.
- Seamless integration with a variety of e-commerce platforms and shopping carts.
- Strong security protocols including fraud detection and PCI compliance.
- Given its feature-rich nature, it might be overkill for smaller businesses.
- Transaction fees can accumulate and become significant for businesses with high volume.
- Could pose challenges for businesses that require highly customized solutions.
Braintree Pricing & Fees
- 1.9% + £0.20 per transaction for European cards.
- 2.9% + £0.20 per transaction for non-European cards.
- Additional fees for add-on services like advanced fraud protection.
Who Should Use Braintree
Braintree is suitable for businesses that require a multifaceted payment solution capable of handling various payment types and currencies. Its seamless integration makes it a good choice for those who need to scale quickly.
How Payment Gateways Work
At its core, a payment gateway functions as a digital intermediary, facilitating the exchange of financial information between the different parties involved in a transaction.
When a customer initiates a payment, the payment gateway securely captures and encrypts the payment details and routes them to the merchant’s acquiring bank. The acquiring bank then forwards the information to the issuing bank for verification.
The payment gateway waits for the issuing bank’s response, which confirms whether the transaction is approved or declined. Upon receiving this feedback, the payment gateway conveys the status back to the merchant’s system, allowing the transaction to proceed to completion or be halted.
From a business standpoint, the reliability and efficiency of this process are crucial. A delay or failure in the payment gateway chain can lead to abandoned carts, lost sales, and diminished customer trust. Furthermore, a gateway’s ability to handle multiple payment methods and currencies becomes particularly relevant for businesses with a diverse or international customer base.
Choosing the Right Payment Gateway for Your Business
Choosing a payment gateway is a critical decision for businesses of all sizes. It can have a lasting impact on your operations, customer experience, and bottom line.
When evaluating potential options, it’s important to go beyond mere functionality and consider a range of criteria, including:
- Fees and pricing structure: Compare the upfront setup fees, transaction fees, monthly subscriptions, and any potential hidden charges to ensure that the total cost of ownership aligns with your budget.
- Integrations and compatibility: Consider the gateway’s ability to integrate seamlessly with your existing technology stack, including your e-commerce platform, point-of-sale system, and accounting software.
- Reporting and analytics: Sophisticated reporting tools can offer valuable insights into customer behavior, sales trends, and transaction success rates. This data can be used to inform strategic decision-making and performance optimisation.
- Security and compliance: Since payment gateways handle sensitive financial information, robust security features and compliance with industry standards like PCI DSS are essential.
- Scalability and flexibility: Choose a gateway that can scale in line with your growth plans, whether that entails expanding to new markets or adding additional payment methods.
- Customer support: Consider the support channels available and their responsiveness to ensure that you can get assistance when you need it most.
Setting Up a Payment Gateway
The basic steps to integrate a payment gateway with your website or POS system are generally as follows:
- Research Options: Look at different payment gateways, consider fees, customer service, and features.
- Compatibility Check: Make sure the one you choose works with your website or POS system.
- Create Account: Sign up and provide the necessary business details and documents.
- Configure Settings: Tailor the gateway settings like currency, tax, and payment methods to suit your business.
- Integration: Add the gateway to your site or system. This might involve some coding, or using a pre-made plugin or app.
- SSL Certificate: Ensure your website is secure with an SSL certificate for safe transactions.
- Test Transactions: Run test payments to ensure everything works as it should.
- Check Legalities: Make sure you’re compliant with regulations like PCI DSS for card payments.
- Set Up Refund Policy: Make sure you have a clear refund and return policy, and that it’s easily accessible to customers.
- Go Live: Once you’re sure everything works and is compliant, activate the gateway for customer use.
- Monitor: Keep an eye on transactions and customer feedback to make sure everything is running smoothly.
- Optimise: Use analytics to improve user experience and potentially lower cart abandonment rates.
What types of businesses are payment gateways suitable for?
Payment gateways are versatile and can be used by a wide range of businesses, including:
- Online retailers: E-commerce platforms need a secure and efficient way to handle online payments.
- Brick-and-mortar stores: Physical retail outlets can benefit from integrated payment gateways in their POS systems for more payment options and faster checkout.
- Subscription services: Businesses that offer subscription-based products or services can automate recurring charges through payment gateways.
- Digital services: Companies that sell digital products, software, or online courses can utilize payment gateways for instant access post-purchase.
- Nonprofits: Charitable organizations can use payment gateways to securely process donations online.
- B2B companies: Business-to-business operations often involve large transactions, and a robust payment gateway can streamline these.
- Freelancers and consultants: Individual service providers can use payment gateways to facilitate easy payment for their services, often through invoicing platforms that integrate a payment gateway.
- Food and beverage industry: Restaurants and cafes offering online ordering can make the process more efficient with an integrated payment gateway.
What are the Cheapest Payment Gateways?
The most affordable payment gateways are:
|Payment Gateway||Transaction Fees (UK Cards)||Transaction Fees (EU/Non-UK Cards)||Other Costs||Contract Length|
|Stripe||1.5% + 20p||2.5% + 20p||None||Month-to-month|
|Square||1.4% + 25p||2.5% + 25p||None||Month-to-month|
|Worldpay||0.75% – 2.75% (Sliding Scale)||Same as UK Cards||£9.95 minimum monthly fee||18-month contract|
It’s worth noticing cheaper transaction rates are often available for businesses willing to commit to long-term contracts or those processing a high volume of transactions per month.
Alternative Payment Solutions
If a traditional payment gateway doesn’t align with your business requirements, there are other financial technology solutions to consider. Peer-to-peer payment systems, direct debit services, and cryptocurrency payment platforms are among the alternatives.
While these may not offer the full range of features that dedicated payment gateways provide, they can offer specific advantages such as lower fees or faster transactions, depending on your business needs.
- Cryptocurrency Processors: Platforms like BitPay or Coinbase Commerce allow merchants to accept cryptocurrencies like Bitcoin or Ethereum. These services often charge lower fees but require both merchants and consumers to be comfortable with digital currencies.
- Direct Bank Transfer Systems: Solutions such as GoCardless or Bacs in the UK facilitate direct debit payments from a customer’s bank account to the merchant’s account. This method is often used for subscription-based services.
- Cheque Payments: Although increasingly uncommon, some businesses still accept cheques as a form of payment. This method is often used for B2B transactions.
- Bank Transfers: Direct transfers from one bank account to another can be arranged without the involvement of a dedicated payment processor. However, this method is often cumbersome for routine retail transactions.
- Escrow Services: These are third-party services that hold funds until goods or services are delivered, commonly used in freelance or contract work.
- Money Order: Similar to cheques but more secure, money orders are often used for larger transactions and are common in the real estate industry.
- Layaway Plans: Some retailers offer layaway plans that allow customers to reserve a product by paying a small deposit, then paying off the balance over time before receiving the product.
Frequently Asked Questions
How does a payment gateway manage multi-currency transactions?
Payment gateways typically use one of three methods for multi-currency transactions:
- Real-time Conversion: Immediate conversion of customer’s payment into the merchant’s currency.
- Separate Currency Accounts: Merchants hold different accounts for each accepted currency, depositing foreign payments accordingly.
- Hybrid Approach: A combination of immediate conversion and separate accounts, usually segmenting the transaction amount.
What is Tokenisation and How Does It Enhance Payment Security?
Tokenisation replaces sensitive card details with a unique identifier or “token,” thereby safeguarding financial information during transactions. This significantly reduces the risk of data breaches and unauthorized access.
How Does Dynamic Pricing Impact Payment Processing?
Dynamic pricing adjusts the cost based on real-time market conditions, seasonality, or customer behaviour. This variability can introduce complexities in payment processing, such as the need for real-time data analytics and adaptable transaction handling mechanisms.
What are Chargebacks, and How Can They Affect My Business?
A chargeback occurs when a customer disputes a transaction, leading to the reversal of the payment. Frequent chargebacks can result in higher processing fees and even termination of your payment gateway service.
How Do Payout Schedules Impact Cash Flow?
Payout schedules refer to the frequency with which the payment gateway transfers collected funds to the merchant’s bank account. Variability in this schedule can affect your cash flow, requiring strategic planning around revenue cycles.
How Do Payment Processing Fees Impact Profit Margins?
While fees for payment processing might seem minimal per transaction, they can accumulate and significantly impact your profit margins. It’s important to understand the fee structure of your payment gateway and plan accordingly.
What Standards Must Be Met for Payment Gateway Compliance?
Compliance with security protocols such as PCI DSS (Payment Card Industry Data Security Standard) is mandatory for payment gateways. Failure to comply can result in severe penalties and may jeopardize your ability to process payments.
What Mechanisms Are in Place for Payment Fraud Detection?
Payment gateways commonly utilize fraud detection features like machine learning algorithms and behavioural analytics. These tools aim to flag suspicious activities, thereby mitigating the risk of fraudulent transactions.
What Mechanisms Are in Place for Payment Fraud Detection?
Payment gateways commonly utilize fraud detection features like machine learning algorithms and behavioural analytics. These tools aim to flag suspicious activities, thereby mitigating the risk of fraudulent transactions.
How Does Payment Gateway Uptime Affect Transaction Success Rates?
The uptime of a payment gateway—the time it is fully operational—directly affects your ability to complete transactions. A gateway with frequent downtimes can result in lost sales and eroded customer trust.