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5 Factors to Consider When Choosing a Payment Gateway

Eva McKnight
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Eva McKnight

Eva McKnight is the public relations and content specialist at Formstack.

Latest posts by Eva McKnight (see all)

Picking the right payment gateway for your online business is a necessary task (you want to get paid, right?), but the process of finding one can be confusing.  No two payment tools are the same. Each provider has unique fees and features that are best for different industries or company sizes.


Overwhelmed by all of the options? It’s understandable, especially due to the sheer volume of payment processors on the market, but don’t fear! Formstack, an online form building platform, has put together a handy website, as well as the infographic below, comparing several of the most popular payment gateways used by startups and small businesses.


If you’re just beginning to research the best payment tool for your company, consider the following five factors:


1. Fees. When choosing a gateway, you will generally encounter three different fees that vary by company: monthly fees, transaction fees, and setup fees. Some tools will require a membership fee, billed monthly, for letting you use their service, while others will simply charge a flat cut or a percentage of every transaction.  Setup fees, while usually small, are a one-time expense you will encounter when initially setting up a payment gateway.

It’s important to plan your budget and company vision before researching fees and charges. Many of the smaller payment gateways do not charge monthly fees, but a more robust system might be better for your business if you expect rapid growth.

2. Currencies. If you primarily conduct business in the United States, this factor will be less of a concern. However, if you are an online company with international consumers, you need to be sure that your chosen provider supports your customer base. Some payment gateways are built with the domestic consumer in mind and only accept USD. Others might accept Euros and the Canadian dollar, but if you need even more options, PayPal and Sagepay accept up to 20 different currencies.

3. Recurring Billing. This feature allows you to set up an automatic billing cycle for customers who operate on subscription. Recurring billing is a must for businesses with monthly payment plans. Additionally, nonprofits have found utility in recurring billing, as this functionality allows organizations to easily collect funds from repeat donors.

4. Mobile Payments. According to Localytics, over 60 percent of consumers believe mobile payments will replace credit card purchases, even in point-of-sale environments. Payment gateways with this functionality allow consumers to transfer money using their mobile device, either with a branded app or a mobile-optimized site. Because this feature is provided through the designated payment gateway, it still holds the same compliance and security standards.

As a startup owner, it might be easy to dismiss this feature as unnecessary when building your company. However, the inclusion of mobile payments might expose you to a powerful demographic of early adopters in technology. If you choose not to include mobile payments when initially launching your company, consider incorporating this functionality in a future iteration.

5. On-Site Payment. With some gateways, your customers will be directed to a third-party site to complete their purchases, instead of staying on your webpage. Off-site payment is often a component of “lower” plans within payment gateways, meaning you can upgrade to include on-site payment.

When choosing a tool, consider the user experience when purchasing a product on your site. If you don’t mind your user leaving your page when completing a purchase, you can probably get away with not having on-site payment. However, this feature can increase brand retention by keeping the entire purchase process on your site, so weigh your options wisely.


For even more insight into your options, check out this infographic:


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