Process of choosing the best Payment Gateway

Decisions. Decisions. Decisions.

When setting up your eCommerce store, one of the first decisions you will make is choosing the right payment gateway for your business. That being said, most entrepreneurs won’t appreciate the options available, the pros and cons involved and the average monthly fees. Many are possibly unaware of what a payment gateway actually is, so let’s get straight to it and give you a helping hand.

What is a Payment Gateway?

In simple terms, a payment gateway is what enables a store to accept cards and electronic payments online. If you imagine the job a shop assistant does on the High Street, they are the internet’s equivalent of the payment gateway.

A payment gateway is required to check customers have available funds on their card, to do fraudulent checks and most crucially take payment. There are a vast number of payment gateways available to Shopify retailers in the UK all battling for your attention with low transaction fees and/or low monthly costs. A detailed comparison is pertinent as many offer different benefits with separate incentives for level of sales and company size.

In order to take payments online you will also need a merchant account. ‘What is that?’ I hear you ask? Well,

What is a Merchant Account?

Think of a merchant account as a bank account holding your money, before it’s send to your business account. Your payment gateway connects with your merchant account, however there are a few gateways, which take this responsibility on themselves. For example PayPal and Stripe let you use their own merchant account usually resulting in higher costs.

How to choose a Payment Gateway?

When choosing an appropriate payment gateway from the hundreds available there are a few things to look out for which we will endeavour to guide you through.

Transaction Fees

Many payment gateways will take a percentage, or flat fee, from each payment made. Take time to compare the options each gateway offers and whether transaction fees are applied.

Monthly Fees

Certain gateways will apply a monthly subscription fee to enable you to use their service. This fee may differ, or be in addition to a percentage of payments taken.

Card Types

Often payment gateways are limited by the different cards they accept. They all take VISA, MasterCard and more often than not American Express. The greater versatility of your payment gateway the better. You should appreciate for an international customer base you need to ensure the range of card types available and whether it can handle multi-currency payments.

Additional Services

A number of payment gateways include features, which would be considered ‘additional services’ by others. Merchant accounts (as above), credit card machines, a virtual terminal and online transaction reporting tool are just a few examples which will improve your payment and transaction process. Everyone loves ‘free’ inclusions as opposed to optional extras.

What are the Payment Gateway options?

There is a lot to consider when choosing a payment gateway. Let’s guide you through our recommended choices to help narrow down and give the best advice before making your decision.


PayPal has established itself globally for being the ‘go-to’ and well trusted quick and easy payment solution. It is a great option for start-up businesses as payments can be generated immediately. Additionally, PayPal gives the option to customise your checkout page as well as giving users the possibility of purchasing products using a Chip and PIN terminal for £99.

PayPal is most commonly known for handling the transactions for eBay (its parent company). However, this fully integrated system enables users to pay via credit and debit cards or via their PayPal account. The downside is that PayPal can work out expensive for retailers with a high numbers of transactions. Here are the key facts and figures (as of April 2017):

  •   No PayPal or Merchant account required
  •   Instantly recognisable and trusted brand
  •   Available refund through Shopify

Setup Fee:  £0
Monthly Fee:  £0
Transaction Fee:  3.4% + 20p p/m per transaction


WorldPay were one of the first payment systems to establish themselves online in 1994 and they continue to be one of the top names in the payment world. Their system and expertise comes at a price mind you, charging a higher transaction fee than most. Their strengths lie in the experiences, support and security. As a hosted solution, an advantage of WorldPay is that it can offer 3D secure, something that Shopify can’t offer natively, which will help to reduce fraud.

Here is a run through of the key facts and figures (as of April 2017).

  •   Charity discount rates available
  •   3D Secure with Shopify
  •   Available refunds through Shopify

Setup Fee:  £75
Monthly Fee:  £15
Transaction Fee:  1.9% + 10p p/m per transaction


SagePay is the biggest independent payment gateway provider in Europe and is considered to have one of the best payment gateways. All major credit and debit card payments are accepted in more than 25 countries as well as via PayPal. Retailers can customise their payment pages and have access to their transaction reporting tool online and via the app.

It is popular with many accountancy firms due to their accounting software and free expert support. SagePay also attracts business because of their ability to take orders over the phone and through EPOS systems. Here are the key facts and figures (as of April 2017):

  •   Free Support
  •   PayPal Integration
  •   3D Secure with Shopify

Setup Fee:  £0
Monthly Fee:  £25
Transaction Fee:  1000 p/m then 10p after

Stripe (which powers Shopify payments)

Stripe is probably the less well known of the four payment gateways we recommend, however it would be our most preferred. It was only established in 2010 but has quickly become the chosen gateway for so many retailers because of the limited stress involved when integrating with eCommerce stores. Crucially, Shopify have selected Stripe as their default payment gateway.

Stripe is very easily set up, in some ways more so than the other gateways suggested, and offer a range of additional features and functionality. Although it often incurs an enhanced monthly subscription the Stripe payment process is made simple. Amazingly Stripe is backed by Peter Thiel and Elon Musk, the founders of one of their biggest competitors, PayPal.

Stripe payment gateways are offered in a range of API’s (application program interfaces). This gives developers full flexibility and control over the look and feel of the payment page and the functionality associated.

Stripe has the ability to accept all major credit and debit cards in more than 100 countries. There are no extra charges for different cards, payment methods or currencies. Here are some key facts and figures (as of April 2017).

  •   Offered in a range of API’s
  •   Powers Shopify by default
  •   Available refunds from within Shopify

Setup Fee:  £0
Monthly Fee:  £0
Transaction Fee:  2.4% + 20p p/m per transaction


PayPal£0£03.4% + 20pLink
WorldPay£75£151.9% + 10pLink
SagePay£0£251000 free then 10pLink
Stripe£0£02.4% + 20pLink


Hopefully this blog helps facilitate your decision on the most useful payment gateway for your eCommerce business. We have tried to highlight that your decision should not be based on costs alone as there are a range of other aspects that should influence your options.

Every eCommerce business will have differing wants and needs, so there is not one gateway that fits all. However as mentioned, our preferred choice would be Stripe as it is simple to work with from a developer and end user perspective and is available with low fees and endless features.

As highlighted, there are hundreds of payment gateway options available. Shopify uses 25 different payment gateways in the UK with varying options and rates. To view a list of all the available options click here.

If you would like more information, if you have any questions or if you would like us to develop your eCommerce store, please get in touch.

Richard Jess

Customer Relations Manager