All over the world, online marketplaces totaled more than 3 trillion dollars worth of sales in 2021. The top 100 online marketplaces are primarily concentrated in North America, Europe, Asia, and Latin America. The Middle East/Africa region - is steadily catching up.
Even better, the e-commerce share of total retail sales around the globe is expected to increase to almost 25% by 2025, with more than 2 billion people shopping online. Yclas believes in the transformative power of e-commerce.
Why a Good Payment Gateway is Vital for Your Online Marketplace
Every year, about 32.4% of hacking attempts are successful. And often, hackers target e-commerce websites through financial fraud, phishing, spamming, DoS and DDoS attacks.
A good payment gateway helps protect sensitive details like credit card numbers by encrypting the payment information.
A secure and efficient payment gateway ensures a successful online marketplace website.
- 15% of shoppers will abandon a cart if they don't think they have a good experience
- 6% of them will seek a shop with better payment options
- 4% will leave a website if it's having technical issues with its payment
Let's explore ten great payment options Yclas offers to get you processing payments.
Stripe's Leading Market Share for Payment Processing
Launched in 2010, Stripe is a payment processor that accepts more than 135 currencies and payment methods, including credit and debit cards and mobile wallets and buy now, pay later services.Stripe is used in 46 countries and enjoys a market valuation of $94.4 billion as of 2021.
3.1 million websites use Stripe, and according to their website, the gateway receives more than 250M API requests daily. Currently, Stripe has 48 patents and 39 investors, including Elon Musk. It holds more than 15% of the market share in the payment processing industry.
PayPal's Trusted Security
PayPal rose to worldwide popularity after eBay acquired it for 1.5 billion dollars back in 2002. Since then, it has become the most used digital payment method globally, with a reported base of 392 million active users.
With more than 1.6 million websites using PayPal, it has been found that buyers are 54% more willing to buy from a store if it accepts PayPal. In 2020 alone, this payment gateway processed more than 15 billion transactions; in 2021, it generated an annual total payment value of 936 billion dollars.
Like Stripe, PayPal employs protective mechanisms to secure customers' account information, such as transaction monitoring and anti-fraud systems.
2checkout's Payment Gateway Flexibility
Officially started in 2006, 2Checkout was founded by the people who developed RAV Antivirus, a piece of technology that Microsoft purchased to form part of its antivirus software offerings. In 2020, Verifone acquired it and envisioned a platform that will "enable omnichannel commerce wherever and whenever clients shop."
Pioneering cashless payment, 2Checkout has an estimated annual revenue of $30.1M, with more than 400,000 users worldwide. According to its website, the gateway processes 10.3 billion transactions yearly, with over 80 global offices.
Pioneering cashless payment, 2Checkout has an estimated annual revenue of $30.1M, with more than 400,000 users worldwide.
As a complete e-commerce solution, it offers various programs for online sellers. Its most expensive option, for instance, allows you to sell in 200 countries or territories and integrate with 120+ carts.
On the other hand, its most cost-effective solution still brings excellent bang for your buck with access to more than 45 payment methods, conversion rate optimization, and shopping cart customization.
Escrow.com's Simplicity in Online Marketplace Payment Processing
Founded in 1999, Escrow.com is an online escrow processing payment gateway that enables the "simplest way" to complete escrow transactions. Integrating with your marketplace website is easy, as it only requires one API call.
Additionally, it accepts various types of payment methods, such as PayPal, bank debit, wire transfer, or credit and debit cards. Since it was acquired by Freelancer.com back in 2015, it has enjoyed numerous awards.
These include a Gold award for Company of the Year in the Small Financial Services sector from The International Business Awards. Escrow also captured the BBB Torch Award for Ethics from the Better Business Bureau Torch Awards. Escrow.com is used by several trusted e-commerce websites such as Shopify Exchange and GoDaddy.
BitPay for Processing Bitcoin Payments
If you want to enable Bitcoin payments through your website, BitPay will allow you to do this. Established in 2011, it has since developed into the leading provider of blockchain payment technology that allows "powerful, enterprise-grade tools for crypto acceptance and spending." In 2022, BitPay will process more than 70,000 transactions every month.
Customers can buy a cryptocurrency with their credit or debit cards or use their crypto and convert it into dollars through the BitPay card. The top industries that use this payment gateway are computers, electronics, technologies, law and government, and finance.
Robo Kassa for a Russian Online Marketplace
Robokassa is an online payment gateway for the Russian market, so if your online marketplace website is targeting this market, Robo Kassa is one to consider. This platform was founded in 2002 and has gathered more than 202,000 active users.
As a comprehensive solution, it accepts several popular payment methods, including online wallets, banking cards, installment cards, and Yandex contactless payment. It also offers Robocheki, an online tool that enables accepting payments without a cash register.
MercadoPago for Latin American Online Marketplaces
On the other side of the world, Yclas' integration with MercadoPago makes it easy for marketplace website entrepreneurs in Latin America to process payments. Created by Mercado Libre, the most extensive e-commerce ecosystem in the region, the platform reportedly processed more than 3 billion transactions in 2021, up by about 70% from the number of transactions it facilitated in 2020.
The platform reported processing more than 3 billion transactions.
Alipay for Asia's Payment Processing
Alipay is a payment gateway that caters to China and Asia. Alipay, founded in 2004, is China's most extensive online payment service, with over 1.3 billion active users and $17 trillion worth of processed transactions in 2020 alone.
Over 80 million merchants use it in their businesses, relying upon its "smart e-commerce, rapid digital transformation, and powerful data-driven marketing capabilities" to drive their e-commerce goals. It works for merchants using Alibaba and Taobao and supports external merchants such as Lenovo and CCTV.
Authorize.net's Credibility with Visa's Backing
A subsidiary of Visa, Authorize.net, was founded in 2004 and has since grown to become a trusted gateway for accepting various payment methods for e-commerce and online marketplaces websites. These include debit and credit cards, eChecks, and other digital payment platforms like PayPal and Apple Pay.
It has served over 445,000 small businesses, processing more than 1 billion transactions every year, amounting to $149 billion worth of payments.
Its most-loved features are automatic recurring billing, advanced fraud detection, and customer information management. Through these functionalities, it has served over 445,000 small businesses, processing more than 1 billion transactions every year, which amounts to $149 billion worth of payments.
SecurePay, Australia's Payment Gateway
And Down Under, we have SecurePay. Founded in 2009, it has grown to be entrusted by more than 90,000 large and small businesses.
It's also a trusted choice for Australia's budding e-commerce industry, which recently saw 44% of online payments made with debit cards.
A Wide Variety of Options with Yclas' Payment Gateways
There you go! Ten payment gateways are readily available in Yclas! Ready to integrate one of the payment gateways into your online marketplace website?
Build your own online marketplace today.
Frequently Asked Questions
Can I Create My Own Payment Gateway?
Yes, it is possible to create your own payment gateway! However, it is a complex and challenging undertaking that requires technical expertise, regulatory compliance, and a significant investment of time and resources!
Here are the general steps involved in creating your own payment gateway.
- Research and Planning: Understand the payment industry, existing payment gateways, and the requirements for establishing a new one. Identify your target market, unique selling points, and revenue model.
- Obtain Necessary Licenses and Compliance: Research and comply with your target markets' legal and regulatory requirements. This may include obtaining licenses such as Payment Service Provider (PSP) licenses, adhering to data protection and security standards, and complying with anti-money laundering (AML) and know-your-customer (KYC) regulations.
- Technical Infrastructure: Build a robust and secure technical infrastructure to handle payment processing. This includes developing or integrating with payment APIs, ensuring data encryption, implementing fraud prevention measures, and establishing a reliable network and server infrastructure.
- Partner with Acquirers and Processors: Establish relationships with acquiring banks and payment processors to facilitate the movement of funds between customers, merchants, and banks. This typically involves negotiating agreements and integrating their services into your payment gateway.
- User Interface and Experience: Design and develop a user-friendly interface for both merchants and customers. This includes features such as payment forms, checkout flows, transaction history, reporting tools, and customer support.
- Security and Fraud Prevention: Implement robust security measures to protect sensitive customer information, prevent fraudulent activities, and ensure compliance with industry standards such as Payment Card Industry Data Security Standard (PCI DSS).
- Testing and Integration: Thoroughly test your payment gateway to ensure it functions smoothly across different platforms, browsers, and devices. Integrate with popular e-commerce platforms and shopping carts to expand your reach.
- Ongoing Maintenance and Support: Continuously monitor and maintain your payment gateway to ensure its stability, security, and compliance with evolving industry standards. Provide prompt customer support to address any issues or inquiries.
It's important to note that creating your own payment gateway requires significant financial investment. We highly recommend using an existing solution out there like Stripe and Paypal! Many entrepreneurs and businesses opt to partner with existing payment gateway providers.
Who Needs a Payment Gateway?
A payment gateway is vital for individuals and businesses engaging in online transactions. For businesses that require the ability to accept payments electronically. Here are some examples of who typically needs a payment gateway:
- E-commerce Businesses: Online retailers and businesses selling products or services through their websites. These websites rely on payment gateways to securely process customer payments. Whether it's a small boutique shop or a large-scale online marketplace, a payment gateway enables them to accept credit cards, debit cards, and other digital payments from customers.
- Service Providers: Professionals and service-based businesses such as consultants, freelancers, software developers, and subscription-based businesses. These businesses often utilize payment gateways. It allows them to accept online payments for their services, set up recurring billing for subscriptions, and manage customer invoices.
- Nonprofit Organizations: Nonprofits often rely on donations and fundraising efforts to support their causes. Payment gateways enable them to accept online donations securely, providing various payment options to donors and simplifying the donation process.
- Travel and Hospitality Industry: Travel agencies, hotels, airlines, and other businesses in the travel and hospitality sector utilize payment gateways. Primarily to accept online payments for bookings, reservations, and other travel-related services.
- Educational Institutions: Schools, colleges, and other educational institutions use payment gateways to facilitate online payments. Specifically for tuition fees, course enrollments, and other educational services.
- Government Agencies: Government bodies and agencies often need to collect fees, taxes, fines, and other payments from citizens and businesses. Payment gateways offer a convenient and secure way to process these payments online.
- Online Marketplaces: Platforms that connect buyers and sellers, such as e-commerce marketplaces, classified websites, and peer-to-peer platforms, require payment gateways to handle the financial transactions between parties.
- Mobile Apps and In-App Purchases: Mobile app developers and businesses that offer mobile applications with in-app purchases or subscription services. These mobile providers rely on payment gateways to handle the payments seamlessly within the app.
- Event Organizers: Companies or individuals organizing conferences, concerts, sporting events, or other types of events. These event organizations utilize payment gateways to sell event tickets and process registrations or bookings online.
What Risks Are There in Payment Gateways?
Like any online system that handles financial transactions, payment gateways come with certain risks. Here are some common risks associated with payment gateways that are important to keep an eye out for!
- Security Breaches: Payment gateways can be vulnerable to hacking attempts or security breaches. Sometimes this can lead to unauthorized access to sensitive customer data, including credit card information (very unlikely, though, due to high security these days).
- Data Theft: If a payment gateway is compromised, cybercriminals can potentially steal customer payment data, including credit card numbers, expiration dates, and security codes. This information can be used for fraudulent purposes, such as making unauthorized purchases or identity theft. Again, highly unlikely these days.
- Fraudulent Transactions: Payment gateways can be targeted by fraudsters who attempt to use stolen credit card information or employ other deceptive practices to make fraudulent transactions. If not properly detected and prevented, these transactions can result in financial losses for businesses. The important thing is to keep an eye out for these. They are usually minimal.
- Payment Disputes and Chargebacks: Disputes between customers and merchants can arise regarding the quality of goods or services provided. If customers are dissatisfied, they may initiate chargebacks, where they request a refund from their credit card company. Excessive chargebacks can lead to financial penalties and reputation damage for the merchant. It's important to have clear guidelines to fall back onto.
- Compliance and Legal Issues: Payment gateways must comply with various regulations and standards, such as the Payment Card Industry Data Security Standard (PCI DSS). Non-compliance can result in financial penalties.
- System Downtime: Payment gateways need to ensure high availability and uptime. Any prolonged system downtime or technical issues can disrupt payment processing, resulting in a loss of revenue for businesses and customer dissatisfaction. It's rare to have any downtime.
- Integration Challenges: Integrating a payment gateway with a business's existing systems and processes can sometimes be complex. Inadequate integration can lead to errors, transaction failures, and inconvenience for customers. Most integrations these days are fairly straightforward though.
To mitigate these risks, payment gateways employ robust security measures like encryption, tokenization, two-factor authentication, and fraud detection systems. Businesses should also ensure they select reputable and reliable payment gateway providers, regularly update their systems, and stay informed about emerging security threats and best practices in the industry.