PayPal emerges as strong merchant account option

By Eric Fleming

Many small businesses have decided to create their own Web sites from scratch, while others are happy with something from Yahoo Merchant Solutions, among other options. However, the most important decision comes with selecting how you will take payment from your customers.

There are quite a few options, from individual merchant accounts with credit card companies to third-party merchant accounts, which wrap up all your credit card processing needs into one easily managed account. Still others have chosen to go with options such as Google Checkout or PayPal. PayPal especially has become popular in recent years.

PayPal Advantages

First, PayPal offers a handful of merchant options, from the ability to accept basic PayPal payments to full-service merchant accounts. Basic accounts require your customers to click a PayPal button on your site before being redirected to PayPal's, where they must log in to their PayPal accounts. More advanced options involve direct credit processing on your own Web site, with PayPal acting as merchant account and credit card processing gateway.

Some of the obvious advantages to using PayPal as your payment option is that many customers are already familiar with it. For them, it's simpler to have a single PayPal login than it is to enter their payment information over and over on each e-commerce site they visit. Only PayPal knows their full personal and financial information; all the vendor needs to know is that the payment was processed.

Unfortunately, for other customers (those who don't have PayPal accounts especially), it can be a bit jarring to click a button, only to find themselves directed to another site. All they wanted to do was buy a widget, not sign up for something. In this regard, using basic PayPal services can be off-putting to potential customers.

PayPal also offers full merchant account services, which can integrate fully with your existing Web site. In this manner, it offers full credit card processing just as other third-party vendors do, and can be compared to them as far as up-front costs, monthly billing and fees are concerned.

As far as PayPal offerings go, advantages include no monthly fees, simple HTML buttons that link directly to custom payment pages, and fast processing. If you and your customers can adjust to suddenly moving to a PayPal page to make a payment, your business can flourish.

Article by Eric Fleming

Published: October 15, 2009