Accepting Credit Cards Online

Chris Campbell has written up a nice primer over on Particletree, and it completely mirrors our recent experience for isabont.com.



Initially, PayPal looked like the simpler, cheaper choice, because of the way they offer both merchant account and gateway in one. But it turns out that if you already have a regular business account at a regular bank, you can just get a merchant account on top of that from the same bank, and it ends up being cheaper than what you would pay at PayPal.



Next, the PayPal API isn’t bad. That is, what they call the “Direct Payment API” isn’t bad. That’s the part that corresponds to what Authorize.net offers, where your customer never leaves your site. This interface is described in just 4 pages (not counting the details of the API) in their integration guide.



But on top of that, you have to also implement the so-called express checkout interface, which is the one where the user makes a detour to the PayPal site. And you have to put the PayPal logo on your screen. And the express checkout interface takes up a whopping 24 pages in that same PDF. That gives you an idea of the added complexity on top of what you’d need with Authorize.net.



So we went back to the drawing board and went with Authorize.net, and we’re pretty happy with that. I just can’t see how what PayPal has to offer is in any way competitive with them.

5 comments

What about international? Did you have a US bank account? Most of the places I have seen make it a bit difficult for non US businesses, where PayPal actually makes it pretty easy for those of us in Denmark.
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True. All the things I'm working on are based in the US. Do you know if it's hard to setup a business in the US even if you live in Denmark? I have people on the other side to talk to the banks and such for me, so I don't really know.
By Lars Pind on Thu, Jul 13, 06 at 05:14 · Reply
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It's pretty easy to setup a Inc or LLC and get a federal tax id, but opening a bank account may be a bit more tricky without actually visiting the US. You can probably do all of it online if you set up a US maildrop.
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They're usually not averse to making money, and at least when I lived in NYC, Chase would gladly charge $10/month just for the privilege of having an account. Alternatively, I was thinking one could perhaps set up shop in the UK, where, if I'm not mistaken, you can also get limited liability for less than the 125K DKK that is required in Denmark, no? Don't know about payment gateways and merchant accounts there, but I'd imagine it's better than here.
By Lars Pind on Thu, Jul 13, 06 at 05:14 · Reply
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Btw, Chase also sent my statements to Copenhagen after I moved back, and until I finally closed the account after I got sick of just seeing my balance dwindle with each monthly statement. Oh, do they make Danske Bank look like philanthropists.
By Lars Pind on Thu, Jul 13, 06 at 05:14 · Reply
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