How to Accept Online Payments in 2022: The Ultimate Guide

Discover all the different ways to accept online payments in 2022 and learn how to choose the best methods for the specific needs of your business.

Online payments can be easy and convenient both for you and your customers, but it's important to choose the right methods and set them up in the right way.

Studies show that on e-commerce sites all over the world, customers abandon their carts without completing a purchase at an average rate of almost 70%. In many cases, this is due to an inconvenient checkout process or lack of payment method options. These days, an optimized checkout and payment experience is key to the success of your business.

After consulting many online business owners and even running a couple of successful e-commerce sites of my own, I'm here to share what I've learned. I'll tell you exactly how to set up your payment processes, what to pay special attention to, and what to avoid at all costs.

How Does Online Payment Processing Work?

Whether you’re new to e-commerce or a seasoned online seller, it's important to understand exactly how online payments work in order to provide your customers with the best experience. Let's take a look at some of the basic elements that work behind the scenes to enable payments to be processed. 

Payment Gateways

A payment gateway is the online equivalent of a point of sale (POS) terminal. It’s a software application on your website that enables online payments to be processed. Payment gateways encrypt the credit card data your customers input and send it to payment processors. They also communicate approvals or denials to you and your customers.

Payment Processors

A payment processor takes the credit card information it receives from the payment gateway and sends it to the credit card network. The card network then checks for fraud and makes sure the customer has the necessary funds to make the purchase. The processor then sends the approval or denial back to you, the merchant. If approved, the processor communicates with the credit card network to go back to the customer’s bank, collect the transaction and deposit the money into your account. 

Merchant account

A merchant account is a business bank account that allows merchants to accept customers' debit and credit card payments. In the past, opening a merchant account was a requirement to accept online payments. Today, it's possible to accept credit and debit card payments without having to apply for a merchant account using a third-party provider known as a payment aggregator. 

  1. A customer chooses an item to purchase and enters their card details on your checkout page.  
  2. This card information is sent to the payment gateway, which transfers the information to the payment processor.
  3. The payment processor transfers this transaction information to the credit card network to verify the customer’s details are correct.
  4. The card network then requests authorization to release the funds with the customer’s issuing bank. After checking for sufficient funds in the account and verifying that the transaction isn’t fraudulent, the issuing bank submits a response to the credit card network that indicates whether or not the transaction has been approved.
  5. This information is then sent to the payment processor, which requests funds from the issuing bank. Funds then get transferred to the merchant account and then onto the business’s bank account by the payment processor. 

What are the different types of online payment methods?

The payment ecosystem is getting more fragmented by the day. Achieving higher approval rates and conversions now requires you to do more than just accept credit cards. You’ll also need to offer your customers their preferred local payment methods such as Google Pay, Apple Pay, Klarna, Pay Safe, Skill, or PayPal and have the capacity to add new payment methods as they arise. Here is a list of commonly used payment methods.

Credit and debit cards 

According to a European Payments Council study, 86% of customers make online purchases via credit or debit cards. More than 60% consider it their favored payment method when making a purchase. While it's possible to accept credit card payments online without any monthly or initial setup fees, you'll need to pay transaction fees whenever a credit or debit card gets used as payment. Popular credit cards include Visa, Mastercard, American Express and Discover. 

Credit cards are a convenient way to pay for things, but they also come with expensive fees. This isn’t the case with eChecks. Paying with an eCheck is like paying with cash. Money is transferred to the merchant when the customer authorizes and delivers their payment to the bank. No credit card interchange fees apply for e Check acceptance, and fees are also generally low.

ACH Payments and e-checks

If you want to offer customers bank-to-bank payments in the US, you may want to consider using Automated Clearing House (ACH) payments. ACH payments are made through the ACH network and allow fund transfers between two accounts. Since ACH payments are not facilitated by the card networks (like Visa or Mastercard), they usually have lower fees associated with them.

Mobile Payments

The use of mobile devices by consumers to shop has increased dramatically over the last few years, with Google Pay, Apple Pay, and many other mobile wallets leading the way. As people spend a lot more of their time on mobile devices and make more purchases through their mobiles than ever before, it’s never been more important for merchants to accept mobile payments.

Mobile Wallets

A mobile wallet or digital wallet is a software that stores customers’ credit card or bank account information. Customers can then use that information to purchase with less friction. There’s also no need for them to pull out a credit card or search for their bank account routing number and manually enter their payment details. Ultimately, this results in better conversion rates due to lower checkout abandonment. In the US, it’s forecast that approximately 54% of all e-commerce sales will be generated via mobile devices by the end of 2021. With stats like this, merchants have little choice but to accept mobile payments or lose sales!

Recurring payments or billing

Recurring payments, aka recurring billing or automatic payment, are payments processed on an ongoing basis for things like subscriptions and membership fees. Merchants need the proper infrastructure to accept these payments, but this doesn’t have to be a complex process. The right payment provider should provide everything you need to handle the technical processing of payments and the software to help you keep track of billing.

Pros and cons of taking online payments

Pros Cons
Reach a global audience Increasing cost of fraud
Reduced transaction costs Downtimes
Payment security Service fees
Payment method acceptance Technical problems
Optimized customer journey

Pros and Cons of the online payment methods:

Payment method Pros Cons
Credit/debit cards - Convenient
- Widely accepted
- Fees
- Fraud and security
ACH Processing-
- Low fees
- Lower risk of chargebacks
- Popular with businesses
- Complex processing and tech
Mobile/digital wallets - Reduced friction - High fees
- Low adoption rates in some markets
Email invoice payments - Faster payments
- Automated
- Save time
- Security
- Spam filters

How To Start Accepting Online Payments to your website?

The internet has opened up a whole new world of opportunities for those who want to build their business online. Whether you are a small or large business, there are endless opportunities to make money today. But how do you actually start accepting online payments to your online store? After choosing the payment provider that best caters to your business needs, all you have to do is follow these simple steps.

Step 1: Decide which online payment methods you require

Consumers these days expect to be able to use the payment method of their choice when shopping online. As a merchant, it’s essential to have many payment options available, including popular local methods, or you’ll likely lose out on lots of sales. 

Step 2: Integrate and customize your checkout page

Once you’ve decided which payment methods you want to accept, your next step is to integrate them into your customized checkout page. This involves configuring the back-end of your site so that when a customer wants to pay, they are directed to your checkout page, where they can easily check out using their preferred payment method. 

Customizable checkout page.

Step 3: Integrate email payment notifications

Payment confirmations or receipt emails are standard business practice to confirm a transaction has occurred. While, at first, this may involve a manual process, integrating automated email payment notifications is a necessity once your business grows.

Step 4: Calculate processing fees

Processing fees for accepting payments can take a big chunk of your profits. It’s, therefore, important to comprehensively understand the costs involved with each payment method you support, so you can better predict your expenses. If a particular payment method is too expensive, you may want to remove it as a payment option from your site. 

Step 5: Connect your site

Now, it’s time to connect your site to all the payment methods you’ve decided to offer. Today, there is no need to manually set up accounts and relationships with each provider. You can simply use a full-service provider with already established relationships with the payment methods and easily add each to your site.

Step 6: Run test orders

You already know that things often don’t run smoothly as a business owner. That’s why it’s critical to test your payment system, flow, and each payment method before you go live with real customers. You’ll likely identify several bugs or issues. Once you’ve fixed these and done a final test to see if everything is seamless, you are ready to go live!

How to choose a payment service provider

Choosing the right payment service provider for your business can be difficult. There are several factors to consider, which can quickly make the selection process overwhelming. Before beginning your search and narrowing down your options, make sure to understand your immediate and longer-term business needs. Once you have this information, you can start looking at what different providers offer. To make your decision easier, here are a few key questions to consider.

Which markets does the provider operate?

The provider you choose should enable you to operate in the primary market(s) you want to serve and those you wish to target in the future. This might be the US, EU, UK, Australia, China, or South America.

What payment methods and solutions are supported?

Today's customers are picky about how they pay. They want to have multiple choices and experience a fast, convenient checkout experience. It's therefore critical to understand whether a payment provider supports the necessary payment methods that suit your business needs. The provider should offer the most popular local payment methods in each of the markets you operate, such as accept credit/debit cards, mobile payments, or e-checks.

Does the provider enable you to customize your checkout experience?

To boost your brand, achieve a frictionless payments experience, and ultimately increase conversions, you need the ability to customize your checkout. There are many ways this can be done including editing the design, adding or eliminating features, adding payment methods, changing text, removing/adding fields, etc. Ideally, you’ll want to find a provider that enables you to define the look and feel of your checkout experience, conduct a/b tests and make adjustments until you find the highest converting configuration. 

What risk management tools does the provider offer?

While it’s great to be able to accept payments from around the world, there are significant risks involved around data protection, security and compliance. With substantial complexities and costs involved, it’s best to use a provider that offers

strong verification, fraud detection and chargeback protection tools to help stay compliant, minimize fraud and keep your customers’ financial information as secure as possible. 

How difficult is integration?

Providers have different integration processes with varying levels of complexity. Some require you to hire developers or keep an in-house development team to integrate it successfully in line with your core business systems and requirements. Others enable merchants to get up and running quickly with little to no code in just minutes. Whatever provider you choose, just remember that dealing with integrations and maintenance can become a major headache that drains resources and slows the time it takes to launch in new markets. It's best to find a flexible provider that's easy to integrate and one that lets you get up and running quickly, like

What reporting and analytics capabilities does the provider offer?

Transactional data provides valuable insights that can help you increase sales and improve your payments experience. The best providers offer access to an easy-to-use and consolidated analytics dashboard that delivers in-depth insights and reporting on your entire operations. You should be able to analyze conversion rates, track sales by product, region, currency or payment type, show where fraud, chargebacks, and refunds are occurring, build custom reports and much more. Ultimately, the more sophisticated the analytics, the more you can optimize your payments and see which areas need to be improved to increase revenue. 

What are the fees and costs? 

Providers generally charge either a transaction fee or an interchange fee. A transaction fee is usually a percentage of the total cost of a transaction, while an interchange fee is a fee paid by banks for the acceptance of card-based transactions. Some providers also charge setup fees, usage fees, and monthly service fees. Ultimately, you need to determine the total monthly costs of a payment solution and decide whether that’s acceptable for your business. This means calculating the total fees for everything mentioned above plus the cost of currency conversions, chargebacks and dispute management.

What level of support can you expect?

The best providers will always be there to offer help. It’s essential to establish what level of support you can expect during setup and in the long term. Does the provider offer ongoing support? How responsive is this support, and what methods of contact will be available? Will you have a dedicated account manager? 

What’s the best way to accept payments online?

The best way to accept payment online depends on variables particular to your business such as your target market, software integrations, price, the number of products you sell, and how you sell them. That’s why it’s critical to first understand your business and customer needs before committing to a provider. is a plug & play payment gateway that empowers businesses to adopt the latest payment technologies and expand to new markets. It provides a lightning-speed gateway service with complete control over customizing checkout pages, a/b testing features, and fraud prevention filters. To find out more, contact our sales team.

What is the safest way to receive payment online?

Accepting payments online always comes with a certain degree of risk. It’s important to understand these risks to protect your business reputation, avoid potential financial losses, and ensure your customers trust you and are fully protected. 

Ultimately, you’ll need to choose a payment provider that offers best-in-class security features

If you use a secure payment provider compliant with the latest industry standards and regulations, you’ll be able to accept any type of payment method securely, whether that’s credit cards or mobile wallets. Check for SSL, TLS, and PCI DSS compliance, tokenization, and additional layers of security like 3D Secure. Some providers even use advanced AI to assess each payment.

What costs and fees can be included in accepting payment online?

There are several costs to consider when you start processing online payments. Depending on the provider you choose, these costs are calculated differently. Here are three typical payment processing models you can expect to encounter.

  • Subscription-based payment processing plan: A fixed monthly fee plan covering most of your processing costs with a limited markup.
  • Flat rate: Every transaction is charged the same rate, so you pay the same amount every month. However, factored into this rate is the interchange rate, including fluctuations. 
  • Interchange: Pay the current interchange rate for each transaction and the margin set by the payment processor.

In addition to these costs, you may have to pay some other fees depending on which provider you choose.

  • Setup fees.
  • Statement fees.
  • Monthly minimum fees.
  • Gateway fees.
  • Payment Card Industry (PCI) fees.
  • Chargeback fees.
  • Early termination fees.

Ready to start in your online business? Learn more about our online payments & payment methods available for your business.

Related Content


How to set up an online payment?

A merchant account and a payment gateway are required to start accepting online payments. A merchant account is a business bank account that allows merchants to accept debit and credit card payments. A payment gateway is a software application on a merchant’s website that enables online payments to be processed. Payment gateways capture and send credit card data to a payment processor and communicate approvals or rejections to you and your customers.

Do I need to qualify for a merchant account?

Yes. Your business must qualify for a merchant account, which means you’ll need to meet specific requirements. You'll be expected to provide financial statements, a business license, business bank account, and a physical address at a minimum.

What are the most popular payment methods?

It depends on which markets your business operates in and whether you’re selling to businesses or consumers. That said, ACH and email invoice payments are generally more popular B2B. Consumers use a host of methods, including debit/credit cards and local digital/mobile wallets.

How long does it take for a payment to be processed?

It depends. Typically, it can take anywhere from 24 hours to 3 days and even longer to process a credit card payment.

Are online payments processed during the weekends?

Banks usually only process payments Monday to Friday - not on weekends or public holidays. Payments made on these days will be processed the following business day.

Are there any fees and when do they apply?

Credit card companies charge a fee for processing payments, but the amount depends on several factors. Many charge a transaction fee, while others charge a fee every month. Some charge both. Fees also depend on your sales volume.

How are online payments recorded?

Recording and reconciling payments can become very complicated, especially if you need to process thousands of transactions. The good news is that many payment providers now provide tools to help you track and record all payments. There are also several third-party accounting software products out there on the market.

What’s the best way to accept payments online?

The best way to accept online payments depends on variables particular to your business, such as your target market, software integrations, price, the number of products you sell, and how you sell them. That’s why it’s critical to first understand your business and customer needs before committing to a provider.

How long does it take to process a credit card payment?

It can take anywhere from 24 hours to 3 days and sometimes even longer to process a credit card payment.

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