10 Best Dropshipping Payment Gateways
What is the vital thing to do before a dropshipper starts an online store? It’s choosing and setting up secure and reliable dropshipping payment gateways. Having a dropshipping store requires a payment gateway because, without one, you won’t be able to sell your products. So, where to begin?
Undoubtedly, you must have a million questions going inside your head. Maybe even you aren’t familiar with the concept of a payment gateway, let alone how it works or how to set up one. The sooner you learn the basics, the easier it’ll be for you to choose one payment gateway for your brand-new online store. So, let’s begin with the basics.
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What is a payment gateway?
A payment gateway is a channel that facilitates the process of making an online transaction. The payment gateway stands between the customer and the online retailer. To be more precise, payment gateways ensure a secure transfer of the customer’s money into the retailer’s bank account. The transactions are performed through debit or credit cards or other payment methods, depending on the possibilities the gateway provides. In practice, the customer makes a purchase and his payment is transferred into the dropshipper’s bank account by the payment gateway.
In the dropshipping world, a secure and reliable payment gateway is indispensable. The next step is how to choose the ideal payment gateway for your dropshipping store.
How to choose the perfect dropshipping payment gateway for your online store?
In today’s ever-changing digital world, there are numerous kinds of payment gateways you can choose from. How to know which one is the most suitable for your store? Some criteria can help you decide more easily about which payment gateway to acquire, for example:
- Type of payment gateway: analyze the two types of payment gateways to see which one is the most compatible with your business;
- Target country: conduct research about the popular payment gateways in the countries you target for dropshipping;
- Fees: check the different transaction fees offered by all payment gateways and the applicable fees for a monthly subscription;
- User experience: explore the payment gateways’ practices and services to discover which one promises an excellent user experience.
Integrated vs. hosted payment gateways: Advantages and disadvantages
There are two options for payment gateways – integrated and hosted.
- Integrated payment gateway: These are those that use API integration and enable you to connect your online store with the payment gateway’s API.
- Pros: This process allows you to keep your customers on your website without redirecting them to another one, thus allowing you to boost your conversion rates and be in charge of keeping your customer’s data safe and secure.
- Cons: Integrated payment gateway solutions are usually customizable. This means you will have to do some development on your own, which can be costly for a beginner dropshipper.
- Hosted payment gateways: With this type of payment gateway, when your customer comes to the point of making a purchase, they’ll be redirected to the payment service providers page (PSP).
- Pros: The advantage of this type is that the gateway is responsible for all PCI compliance and data security.
- Cons: The drawback, on the contrary, is that the process of redirecting your customers to an unknown website can cause them to distrust your services.
Which payment gateway is best for dropshipping?
You now know the differences as well as the pros and cons of the available payment gateways, so, it’s time to gather the best in one list. These are the 10 best payment gateways you can use for your dropshipping business.
PayPal
PayPal is one of the most popular payment methods worldwide at the moment. With over 400 million active account holders, PayPal accepts payments through all major credit cards as well as debit cards. If you decide to set up PayPal for your store, you’ll use the PayPal Commerce platform for which you’ll need a business account which is free of charge. PayPal is usually used as a hosted payment gateway although it also offers an upgrade if you want to use it as an integrated gateway – PayPay Pro. This option is available for a monthly fee of $30 USD.
Availability:
- +200 countries worldwide
Transaction fees:
- 1-3.49% plus a fixed fee which varies depending on the payment location
Number of accepted currencies:
- Supports 25 currencies
Skrill
Another popular payment gateway similar to PayPal is Skrill. Currently used by around 120,000 merchants and 40 million individuals, Skrill is considered a more economical choice in comparison to PayPay.
Availability:
- +130 countries worldwide
Transaction fees:
- 0-5% based on the payment method used
Number of accepted currencies:
- Supports 40 currencies
Stripe
Next on the list of popular payment gateways is Stripe, an integrated payment gateway solution that uses flexible API integration. If you choose to go with Stripe, you can customize the platform according to your preferences. Available in more than 40 countries, Stripe is the choice of millions of businesses worldwide. It supports integration with WooCommerce and Shopify, and it’s used mostly by dropshippers based in Canada, Australia, and the UK.
Availability:
- +40 countries worldwide
Transaction fees:
- 2.9% plus $0.25 USD for international transactions
- 1.4% plus €0.25 Euro for transactions within the European Economic Area
Number of accepted currencies:
- Supports +135 currencies
Amazon Pay
Amazon Pay follows the same pattern as PayPal and Stripe. It doesn’t charge for setting up an account and asks for different transactional fees for domestic U.S. transactions and international transactions. It can be integrated with an API and without a monthly fee. It’s designed for online merchants and offers an excellent experience for its customers.
Availability:
- 18 countries worldwide
Transaction fees:
- 2.9% plus $0.30 USD for domestic U.S. transactions
- 3.9% plus $0.30 USD for international transactions
Number of accepted currencies:
- Supports 12 currencies
Authorize.net
Another popular solution for a flexible and secure integrated payment gateway is Authorize.net. They accept it in more than 30 countries but it is quite a popular gateway choice for retailers based in the USA. Authorize.net requires a monthly payment of $25 USD and also charges a transactional fee per sale. The payment gateway can be adopted by small or medium online stores based in the USA, UK, Canada, Europe, and Australia.
Availability:
- 33 countries worldwide
Transaction fees:
- 2.9% plus $0.30 USD per transaction for those without a merchant account, while those who have one can opt for the Payment Gateway Only plan and be charged a transaction fee of $0.10 and a daily batch fee $0.10
Number of accepted currencies:
- Supports 12 currencies
2Checkout
Available in more than 200 countries across the globe, 2Checkout is a payment gateway that also uses API integration. It’s a solid option for dropshipping stores as it offers the possibility to integrate with other payment gateways such as PayPal, Stripe, and Skrill, as well as localization for a better customer experience. It accepts payments with major credit cards and other payment methods. These characteristics make it a suitable payment gateway for more than 17,000 eCommerce and dropshipping businesses globally.
Availability:
- +200 countries worldwide
Transaction fees:
- 2Sell Plan: 3.5% plus $0.30 USD per transaction
- 2Subscribe Plan: 4.5% plus $0.40 USD per transaction
- 2Monetize Plan: 6% plus $0.50 USD per transaction
Number of accepted currencies:
- Supports +100 currencies
Adyen
Adyen is an example of an integrated payment gateway solution that supports more than 250 payment methods. Online retailers from across Europe, North America, Latin America, Asia, and Pacific Africa can implement it. The payment gateway doesn’t have set-up fees or monthly fees but it does have a minimum invoice of $120 USD per month.
Availability:
- +38 countries worldwide
Transaction fees:
- processing fee of $0.10 USD plus fee determined by the payment method per transaction
Number of accepted currencies:
- Supports +30 currencies
Apple Pay
The favorite choice of Apple users is Apple Pay. The payment gateway accepts payments using all major credit and debit cards, as well as other payment methods. Apple Pay is compatible with and supported by Authorize.net, Stripe, and Braintree. Furthermore, it’s considered a safe and secure alternative for most Apple users as it provides the possibility to make payments through Touch ID or Face ID, without saving any information about credit cards or transactions.
Availability:
- +70 countries worldwide
Transaction fees:
- 1.5% plus $0.25 to $15 USD per transaction
Number of accepted currencies:
- Supports +70 currencies
Braintree
Powered by PayPal, Braintree is the ideal payment gateway for those dropshippers who want a highly customized online store. Braintree is designed to fit the specific need of all dropshippers, not just one. Along the way, as your online store grows, it provides the possibility for modifications of the solution. Braintree supports PayPal, all major credit and debit cards, as well as Apple Pay and Google Pay. As a dropshipper, you can contact Braintree’s customer service at any time in order to guarantee you a unique experience.
Availability:
- +40 countries worldwide
Transaction fees:
- 0.75-3.49% plus $0.49 USD per transaction
Number of accepted currencies:
- Supports +130 currencies
WePay
Last on the list of best payment gateways for dropshipping is WePay. Yet another choice for an integrated payment gateway, WePay is present only in the North American territory. Similar to Braintree, WePay is able to work with a flexible API to offer a seamless experience for both dropshippers and their customers. Some reviewers state that WePay’s solution is somewhat complex. WePay compensates for this with its complete support and payment risk coverage of 100%.
Availability:
- US, UK, and Canada only
Transaction fees:
- 2.9% plus $0.30 USD per transaction
Number of accepted currencies:
- Supports 2 currencies
Last words
Picking a good dropshipping payment gateway is one of the most crucial steps in your dropshipping journey. Your choice will define a big part of your cash flows because, at the end of the day, the more satisfied your customers are with the payment methods you’re offering them, the bigger the sales. If you’re completely new to the dropshipping business, we recommend you to check out this step-by-step guide on how to start a dropshipping business and cover all the basics before choosing your payment preferences.
About the Author
Kristina Gjorgievska
Kristina, Head of Content at BrandsGateway. Eternal inspiration: The Doors music and lyrics, Bernardo Bertolucci's timeless “Stealing Beauty”, and the dynamic and meditative Ashtanga Yoga.
