Starting a new business presents a bewildering range of challenges. Most new retailers want to focus on their business fundamentals – the products they’re selling, their premises and in the case of eCommerce their website. At the same time, it’s crucial for a business to be able to be able to accept payments from a wide variety of customers – that means accepting credit and debit cards safely and securely.
For those who are new to the card payment industry there is a staggering array of jargon. In eCommerce in particular new retailers have to quickly get up to speed with detailed questions and choices. The effort is worth it – as Europe’s largest eCommerce economy with 73% of consumers having shopped online every 3 months, the UK represents a fantastic market for the budding Internet entrepreneur.
One big reason for the success of online retailing in the UK is that most net users have both credit and debit cards and both can be used to pay for online shopping. £80 billion of consumer spending is either on or influenced by the internet, of which £30 billion of retail spending is online and £20 billion on other consumer spending is online. (IMRG)
There’s a wide range of companies who can help you trade on the internet. Different solutions will suit different sorts of business and as your company grows it may well make sense to change between the solution you need.
To accept card payments you will need two things - an Internet Merchant Account from a bank and a processing connection from a Payment Service Provider. The Internet Merchant Account (IMA) is the facility which allows you to accept card payments. A Payment Service Provider (PSP) will enable you to connect to the bank to process the payments.
Banks will set out a number of requirements to qualify for an Internet Merchant Account and these processes can take a while to complete. It’s important to apply early in your business set up to make sure everything is ready in time.
An alternative option for those just starting out in business is to select a combination account like the WorldDirect solution offered by WorldPay. Because WorldPay defer funds to merchants they can quickly and easily set up most businesses with both payment processing and an Internet Merchant Account. That means you can start taking payments very quickly. WorldDirect is perfect for small and start-up businesses that may struggle to obtain an Internet Merchant Account from their bank. Additionally it is a very simple way to accept multi-currency payments.
Pricing
The specific costs of the service will depend on the business’ average transaction value, transaction frequency, perceived security risk, exposure level, online turnover and how long the company has been trading.
Integration
A prime factor in the success of your online store is the shopping cart software you use to sell your services and products.
It is important to select a payment service which links to the shopping cart software you’ve selected. Solutions such as WorldDirect are connected to many of the leading shopping cart and store building products. That means that once your account is set up and your store is populated with the goods and services you wish to sell you can begin to accept cards immediately. Your chosen PSP and shopping cart provider will offer full technical support, software cartridges where appropriate, and technical documentation to help you integrate your store and your shopping cart package.
It is worth knowing that there are two main integration models when planning for your business in the short and medium term. These models are often referred to as direct or invisible and redirect or payment page, although you may hear a number of similar terms.
The most suitable model for new businesses is the payment page model. The shopping cart software will forward consumers over to a set of checkout pages hosted by the PSP. All the card details will be captured directly by the PSP and at the end of the transaction the consumer will be sent back to the retailer’s website. Because the PSP is handling all of the security, the pressure is taken off retailer to set up secure card processing systems.
An invisible integration will mean that the consumer never leaves the retailer’s website. Larger merchants prefer this model as it means they can control everything that the consumer sees, but such solutions will mean the retailer has to invest heavily in IT and security.
Pay page Customization
For those using pay page integration, a range of customisations are available. For instance WorldDirect’s management system enables you to customise aspects of the payment service that are visible to your customers, including:
- Modifying the look-and-feel to match the branding of your website
- Taking payments in up to 144 different currencies and customise the payment language to match the language(s) of your website.
- Adding and modifying the messages that are presented to your customers when they are paying online and in the confirmation emails they receive after doing so.
- You can opt to have consumers' payments processed in 'real-time' (payments are automatically routed to the appropriate bank for authorisation) or deferred (you review your customers' orders and payment details before they are processed). You can also opt to pass order information from our payment system to your inventory and stock management systems.
Security
With a payment page integration, consumers card and account details are captured on the PSP’s secure servers, so you do not have to worry about maintaining a system or keeping abreast of the latest payment or anti-fraud developments.
Using sophisticated new encryption techniques and fraud-prevention technologies, the solution offer increasingly high levels of security enabling you to spend more time focusing on your core business rather than managing risk. Payment processing services supports internationally recognised security checks including:
- Card Verification Value (CVV2) – checking the digits on the signature strip of the credit card
- Verified by Visa and MasterCard SecureCode – advanced systems for validating the identify of the customer at transaction time
- Address Verification Service (AVS) – checking the address of consumers against the billing address of the credit or debit card they use.
All these fraud control systems are valuable in reducing fraud and the likelihood of receiving chargebacks – where a consumer disputes a transaction. Retailers should aim to read the information that their bank provides about chargebacks as many new merchants underestimate the effect fraud can have on their businesses.
Management
Your PSP will almost certainly provide reporting systems which enable you to review and control (e.g. refund) the payment, settlement, and anti-fraud information we process for you. These systems can be very useful in tracking transactions and keeping a record of card transactions and because they’re online, you can access your accounts at any time.
So to give yourself the best chance to succeed it’s important to select a payment provider that you trust and which is suitable for your business. You should check they can work with your chosen shopping cart of provide a suitable integration model.
Ian Rutland is head of business development at WorldPay Ltd
For more information please visit www.worldpay.com/uk [1]