Comments on: Processing Your Own Online Payments - A Brief Tutorial [Part 1]

By: Free Nights and Weekends » Blog Archive » Processing Your Own Online Payments - A Brief Tutorial [Part 3]

Thu, 17 Jan 2008 15:41:57 +0000

[...] Part 1: Client-Side Storefront [...]

By: Free Nights and Weekends » Processing Your Own Online Payments - A Brief Tutorial [Part 2]

Thu, 09 Aug 2007 14:48:40 +0000

[...] Part 1: Client-Side Storefront [...]

By: Chris

Chris — Wed, 25 Jul 2007 21:58:45 +0000

Lee,
Thanks so much for sharing your experience. I’m looking forward to reading the next parts!

@Bob and @Daniel it appears that both of you work in the payment processing industry (wsibestbusiness and avangate, respectively). You both claim the cost of a professional is only 2-3% of sales…could either of you point to a processor willing to accept only 2-3% of sales? Thanks!

By: Bob Peterson

Bob Peterson — Wed, 25 Jul 2007 14:38:26 +0000

Payment processing is an area of responsibility that is not to be entered lightly. For instance, you mention nothing about taxes. I’ll reemphasize that you need legal and financial advice. You should only seek advice from people experienced with online payment processing, since most people are only familiar with physical stores or possibly phone or mail-order (”card not present”) purchasing. Internet purchasing carries extra rules and liabilities.

Having worked in the Internet payment business for many years (during the Bubble) I think the idea of handling my own payment processing is too risky and the DIY effort is rather steep to comply with regulations and laws, as well as worrying returns, full and partial refunds, accounting, theft, fraud, and reliability. I expect that as more businesses do it, more expertise and tools are available to help compliance, but it still seems non-trivial. Third party vendors make it trivial, in comparison.

At some point of volume, the 2 or 3% you’re charged becomes a mere cost of doing business, like hiring a bookkeeper or renting a card reader. It’s nothing to fret about unless your margins are unrealistically slim or your volume is so big (really big) that spending your precious time to learn more about payment processing starts to become worth it.

That said, rolling your own -store- is definitely worth doing! Payment processing is a back end you should be able to tack onto any store.

By: leefalin

leefalin — Wed, 25 Jul 2007 13:20:39 +0000

@Andy: I’ll email you the rates we received from our local bank.

——————————————————-

@Daniel: It would seem to me that as your business grows that 2-3% would become an ever increasing concern. As for 24×7 support, I don’t know of any isv’s that offer anything other than email or forum support. Antifraud is handled by the payment gateway service (at least in our case) and by following the guidelines in the “preventing fraud” section of the manual (which I’ll talk more about in part 2). As for translating your storefront, I would think that could easily be handled for a very small price at the same time that you localize your app.

That being said, processing your own payments isn’t for everyone.

By: Daniel

Daniel — Wed, 25 Jul 2007 08:16:45 +0000

Having an order processing department can be a solution if you are a small company but when your business is growing you will need a lot of resources to support your customers (and I am talking here about multilanguage storefront and support, 24×7 hotline, antifraud experts, etc). And for what? For only 2-3 percent of your online sales you can outsource the entire process to a professional service

By: Do It Yourself Payment Processing : mac isv

Do It Yourself Payment Processing : mac isv — Tue, 24 Jul 2007 22:16:20 +0000

[...] A tutorial on processing your own online payments. [...]

By: Andy Kim

Andy Kim — Tue, 24 Jul 2007 18:28:18 +0000

Hi Lee,

It’s nice to see a tutorial from someone else who has rolled their own store.

I have a question regarding your merchant account. What are the rates like? PayPal is upping the monthly fees of Website Payment Pro to $30/month and I’m thinking about just getting a merchant account myself.

By: University Update - Open Source - Processing Your Own Online Payments - A Brief Tutorial [Part 1]

Tue, 24 Jul 2007 17:22:31 +0000

[...] Link to Article open source Processing Your Own Online Payments - A Brief Tutorial [Part 1] » [...]

By: Daniel Jalkut

Daniel Jalkut — Tue, 24 Jul 2007 17:07:49 +0000

This is really awesome. Great advice, and nicely organized. I can’t wait to see part II.