Happy Tech Tip Tuesday!
When it comes to payment processors, there are 3 that reign supreme in the online world. These 3 dominate most e-commerce platforms, websites, and digital products platforms. What many entrepreneurs (regardless of how long you've been in business) need to understand is that they are all great but have different fees associated with them . Here are the 3 main payment processors and how you can choose which one is best for you:
- Paypal: Why I like paypal: it's become the new "norm". More businesses and places are now taking paypal for a payment option, which makes it easier to connect to your account. The only wish I have is for integration with Apple Pay (which has been "allegedly" coming since the last iOS update) since it dominates a lot of mobile commerce. The fees are pretty much straight forward: 2.9% plus $0.30 USD of the amount you receive. The fee does increase based on your volume of sales so pay attention to the fine print. What's great is that you don't pay a fee to purchase goods or services (the provider does: bonus for you). I've personally experienced Paypal freezing my account because of suspicious activity (glad I have 2 accounts) so they do take fraud very seriously.
- Square: Why I like square: it's available everywhere. Square has definitely taken off when it comes to small business and physical locations. When you go into most places now, they have the: "square accepted here" sign, which is a great sign. We are in a mobile society and someone bringing in cash for a purchase is kind of rare these days. I love the fact that their new square reader integrates with Apple Pay (huge move by them). The fees are definitely different from invoice, online, and manual: 2.75% for magstripe card transactions, chip card transactions, contactless (NFC) payments, and paid Square Invoices. 2.9% + 30 cents for online sales, and manually entered transactions are 3.5% + 15 cents. I've never had any issues from square. They have great deposit options from invoices and purchases (make sure you check your account settings to determine what's best for you).
- Stripe: Why i like stripe: it's becoming the new "go-to" for payment processors. Stripe gives you variety when it comes to specific e-commerce platforms (i.e. Gumroad, Squarespace, etc.). There API (application program interface) is open to developers for integrations of all kinds (huge in technology). They are definitely up and coming in the payment processor world but they are making a little noise. When it comes to their fees, they are one of the few that offer bitcoin: 2.9% plus $0.30 USD of the amount you
receive (no fee to purchase goods or services). No hidden fees after that. ACH and Bitcoin fees are capped at $5—payments above $625 cost $5 (please pay attention to this).
When it comes to payment processors, there are a plethora to choose from but these 3 are truly the best in the business. Your financial goals will depend on which one is best for you and your business. Continue to do additional research and don't forget to read the fine print. I always send out awesome infographics or worksheets to my email list for learning purposes. Please feel free to provide me with your email address to receive it.