Online Business Credit Card Processing Tips

Here are a few online business credit card processing tips for small businesses to use, whether they are online only or even if they also have a bricks and mortar store.  If you have an online store and had your local web-developer build the site for you, the odds are pretty good you are paying more than you should be, whether you are using PayPal or a plug and play gateway like We can help you reduce your processing costs by understanding exactly what you are paying for and to who, when it comes to accepting online credit card payments. There is also a new Zero Cost Credit Card Processing Program available in 40 states that can reduce your processing costs to zero and you just pay monthly fees of less than $100 plus fees for debit card processing, if you accept debit cards. 

Let’s take a look at PayPal fees first, which are 2.9% and $.30 per transaction. Looking at the numbers based on a $30.00 transaction the fees come to $1.17 or 3.9%.  That is a huge expense to a small business owner’s profit margin. On a $20 transaction your business is paying PayPal 4.4%. If your business has a large number of transactions under $30.00 you are paying over 4% on those transactions.   That $.30 per transaction really adds up. No wonder eBay decided to buy out PayPal.

TIP: If you are selling products online and averaging $40.00 or less per transaction, check for other solutions since PayPal is most likely the most expensive choice.

We provide our merchant clients with some of the best small business credit card processing rates to help them accept online payments, and they don’t even approach 4%, while many of our merchants enjoy effective rates well below 3%. The PayPal per transaction fee of $.30 is extremely high. I have advised many businesses on gateway solutions.  I typically look at security first, look to make as few technology changes as possible to their current structure and price them fairly so I can reduce their monthly credit card processing costs.

We provide our clients the choice of several integrated solutions with major shopping cart providers and our processor has its own gateway with one low monthly fee, not an additional per transaction fee. Feel free to contact me to see how I can help your business reduce its processing costs and operate more efficiently.

Online Business Credit Card Processing Tips for Gateways

Until several years ago, most credit card processing companies had to use a third party “gateway” such as PayPal or (more about them below) to accept payment for online purchases, but fortunately, those days are over.

A “gateway” is an e-commerce application service provider that is able to authorize online credit card payments and basically act as the gateway that passes the transaction through to the credit card processor. That’s all they do! Most business owners don’t realize they are paying too much for this simple service because those gateways charge per transaction fees and daily settlement fees on top of what the merchant is already paying for credit card processing. OUCH!!!

These gateways were originally needed for security purposes, but there were only a few of them until now. Gateways today are very secure with credit card info being encrypted and passing through to the processors servers for processing. We work with several processors that have their own gateway so it brings down the cost of using a third party gateway.

TIP: Third party gateways charge per transaction fees and daily fees for settling your transactions at the end of each day. You are better off using a gateway like Converge , so you won't end up paying two types of fees per each transaction.

The Converge Multi-Purpose Gateway and Management Tool

We offer our merchants that sell products or services online a program called Converge, which is not just a gateway. Converge, available through our relationship with Elavon, is an multi-commerce payment solution and management tool that offers businesses the ability to accept payments in any payment environment needed, including e-commerce, mail order/telephone order (MO/TO), mobile, and even in-store purchases. Contact me for a free demo account to test with no obligation or signup required.

The Converge gateway also allows small business owners to invoice clients, send receipts via e-mail, auto-populate fields from returning customers, do recurring billing and assist business owners by providing them with important management tools. It is a secure payment gateway because the processing of the transaction does not occur on the small business owners website or servers, the processing occurs on Elavon’s secure servers.

Converge Features and Benefits at a Glance

The Converge software platform can be used by small as well as mid-sized businesses in the retail and other industries selling items or services online. It is an all in-one solution since:

  • For new business or business without a website, it can register the desired website address url;
  • For existing websites, it provides the address during approval of the merchant for processing which can be switched to 3dCart for integration at the time of setup; and
  • Provides an SSL certificate for secure checkout and payment with Converge;
  • Provides Quickbooks integration;
  • Provides recurring billing or re-billing of customers on a varied schedule even if not the same amount and even if not every month, saving significant time in data entry; and
  • Available rates are typically lower than PayPal, and Shopify.

TIP: Look for a solution like Converge which is not just a gateway, but provides management tools to save you time and helps your business operate more efficiently.

More on PayPal and

Since there were only a few gateways until recently, this resulted in the costs for online credit card processing being more expensive than the processing costs for in-store sales. While the costs for online processing have come down, it still costs small business owners more when they sell something online. As mentioned above, PayPal is now owned by eBay, and most sellers using eBay will attest to the love-hate relationship they have with eBay. When it comes to selling items under $40.00, the fees can add up quite significantly when using PayPal. This is one of the best online business credit card processing tips I can give smaller merchants that don't realize how much PayPal is actually charging as a percentage.

While most credit card companies today have their own gateways, is still a big player and commands a large, but some say dwindling market share of online payments. Since 1996, has been providing payment gateway services, managing the submission of transactions to the processing networks on behalf of merchant customers. is a solution of CyberSource Corporation, a wholly owned subsidiary of Visa. So in addition to Visa making money on dues and assessments fees involved in a credit card transaction, they are also making fees on their gateway.

Who Gets all Those Fees in and Electronic Payment Transaction?

The amount you pay for assessments and interchange fees are set by the card networks and card issuers to help cover their part of the costs associated with their part of the payment process and to allow your payment transaction to go through. . Approximately 90% of the cost for each transaction goes directly toward assessments and interchange fees and consequently the card issuers and their networks. The processor works behind the scenes providing safe reliable and speedy transaction processing, customer support and assistance along with funding the transaction.

Online Credit Card Processing Tips on Security

Online purchasers today require a secure payment environment and an SSL certificate is one way of providing that to your online customers. Studies actually have shown that younger online purchaser are more prone to click away from a website that does not have an SSL certificate than online purchasers over 40 years old. It is interesting how younger purchaser are more security minded that older purchasers, but of course, the younger ones are more tech savvy as well. We use a three-pronged approach when advising our clients and security is the most important factor when it comes to online business credit card processing tips.

TIP: Make sure the gateway solution you are using provides an SSL certificate for secure checkout and payment.

Surcharging Customers for Processing Fees

More and more businesses are beginning to consider the option of surcharging their customers that want to pass processing costs on to their customers. Currently this is not available in all states and only certain processors actually have the sophisticated software to carry this out. It is a double edged sword, since you might offend some loyal customers, and it is not recommended if you are just starting up your business. We work with some of these processors so if you are interested in the possibility of passing processing costs on to your customers, be sure to contact me about the availability of this in your state. Surcharging is one of those online business credit card processing tips you want to keep an eye on because we feel the number of business owners deciding to surcharge their customers will be going up each year and eventually most if not all states will allow it for merchants. Keep in mind, surcharging the wrong way can lead to severe fines and penalties.


I hope these online business credit card processing tips have been helpful and shed some light on ways to help save your business money when it comes to accepting online payments and some management tools that are available to run your business more efficiently.

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