Are you thinking about how to handle payments online for things like donations and online registration? If you are new to online credit card processing, you will probably need a primer on how online credit card processing works. However, if you’ve done any amount of shopping on the Internet, the service PayPal may be the first thing you think of in terms of online credit card processing.
PayPal is the leader in Internet credit card processing. However, they do offer a bewildering set of eCommerce products. One of the most common activities EventRebels staff performs is guiding customers through the possibilities. There are a variety of major PayPal products, each with its own strengths and weaknesses.
PayPal Personal is the easiest way to begin accepting payments on the internet. PayPal states that Personal’s main use is for making purchases online and sending money to family and friends. It can also be used for business operations with limited credit card processing needs, as you are able to collect payments online with a PayPal Buy Now button. The money is held in your PayPal account until you are ready to transfer into your bank account.
The big limitation with PayPal Personal is that the customer will only be able to pay if he or she has a PayPal account. This is pretty much a show-stopper if you plan to receive payments from the world at large. Small startup operations are attracted to this option since there are no monthly fees for PayPal Personal, just usage and bank processing fees deducted from each payment.
The next step up would be the PayPal Standard account, which also has no monthly fee, just processing charges. The big advantage to this account is that customers are not required to have a PayPal account – they can pay directly with their credit card. However, customers are taken to from your site to PayPal, potentially causing confusion. Furthermore, the data on your web page is largely disconnected from the PayPal site, so a lot of your gains will be lost in spending a great deal of time performing manual reconciliations between your web e-commerce system and PayPal.
PayPal Advanced has a monthly fee of $5.00 a month, but offers a few improvements. Processing is still done on a PayPal page, but it can be embedded on your web site thus leading to a cleaner user experience. Advanced does link to some shopping cart platforms, but if you are using any specialized product like online registration, you will still have the same reconciling and reporting shortcomings as Standard.
In the mind of this author, the real home run is Payments Pro. For $30.00 a month you resolve all the issues of the previously discussed products. What is huge for web site integrators is that Pro uses an API (Application Programming Interface) to communicate directly with the web site or commercial vendor. This lets the software developer totally control the user experience. All PayPal data is tied directly back to your e-commerce software, thus leading to unified and easy reporting. You will also have fewer user problems because of the consistent experience. While there are a few better e-commerce products in the marketplace, there is no easier product to get going online than Payments Pro. All you have to do is sign up for PayPal and upgrade to Pro.
Keep in mind that all the products we have discussed use PayPal’s merchant account and thus are subject to those bank fees. While the rates are competitive, if you do large volume and/or transactions, you may find that your own merchant can provide much better rates. So that you can use your own merchant, PayPal provides a couple of other products. These are harder to setup than the other services (namely getting your own merchant account and relations), but they do have some advantages.
PayFlow Link is like PayPal Standard/Advanced except you are using your own merchant. It is more expensive with a $179.00 setup and $19.95 per month. Given that the user is given an inferior user experience by being taken off your website to a PayPal page, this service is unlikely to be good solution for high-end services like online registration.
PayFlow Pro, on the other hand, is the crown jewel of PayPal’s services. It has all the power of Payments Pro (and then some) while allowing you to use your own merchant. The only downside is that it can be pricey – $249.00 setup, plus $59.95 per month. However, if you are doing a large volume of transactions you may find that you actually save money from the reduced bank charges and related fees. Hence, this service is popular with larger companies and associations.
The prices mentioned in this article are, of course, subject to change and may be supplemented by minor per transaction fees. That said, this review help with the guidelines you need to make a decision regarding PayPal products. Here are some direct links to PayPal’s pages on the products we’ve discussed:
Contact us if you’d like some guidance in regard to integrating PayPal with conference software such as online registration.