Designing Website

What is a payment gateway? Plus, 5 of the Top Payment Gateways for 2021

What payment gateway do you need to use for your online store? This question is often difficult for many people. It’s not difficult to understand the concept of payment gateways or online payments, especially if you are new to this area.

It can be difficult to make a decision when there are so many online payment options. This is where our guide comes in. We tell you what to search for in an online payment gateway , and we present five top-rated solutions on the market.

Are you in a rush? We have compiled a list of the best payment gateways available.

Summary Table:

Five of the most popular payment gateways
Payment gateway Prices starting at Editor’s Rating
Payline Credit card fees + 0.3% per transaction + 10 per month
Stripe 2.9% + 30C/per transaction
Authorize.Net 2.9% + 30C/ per transaction + $25 per month
PayPal 2.9% + 30C/per transaction
2Checkout 3.5% + 30C/per transaction

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Table Of Contents:

What’s a payment gateway?
What is a payment gateway?
How do I choose a payment gateway
The best payment gateways in comparison
Final recommendation and summary

Let’s get started with the basics.

What’s a payment gateway?

A payment Gateway is the intermediary between your online shop and the payment processor who receives payment from your customer.

This means that once a customer has entered their payment details, the payment gateway will send the data securely to the processor.

The payment gateway handles authorizing payment and verifying that all data is correct to complete the payment. By encrypting sensitive information, the gateway protects credit card details. This ensures that customer information is securely transmitted between merchant and customer.

The payment gateway is part the “magic” behind transactions on the internet. It enables ecommerce stores to function by securely sending information between the website (and the payment processor) and returning transaction details to the website.

A payment gateway is required if you want to accept credit card payments online. It acts as a bridge between you and your customer.

What is a payment gateway?

Good news: You don’t need to know how the payment gateway works below. You can choose a gateway, then connect it to your online store using the usually user-friendly setup wizard. It’s that easy! You can then collect payments from your customers.

To give you an idea of the steps involved, here are some examples:

  1. Your website is visited by a customer who places an order. The customer places an order on your website.
  2. The payment gateway receives the payment information and encrypts it before sending it via a secure channel to a payment processor.
  3. The customer is redirected to payment processor.
  4. The payment processor guides the customer through each step to complete the payment.
  5. The payment processor verifies that the payment was successful and sends a message to the customer.
  6. Customer can return to the online shop.

In practice, this means that the payment gateway only allows the customer to contact the payment processor. The gateway is exactly what its name implies – it’s a “gateway” which allows customers to communicate with the payment processor through a secure channel.

How do I choose a payment gateway?

Here are some things to look out for in a payment gateway

Does your e-commerce platform support the gateway?

You might have one payment gateway available, but not another depending on the e-commerce platform you use.

Nearly all e-commerce platforms can accept PayPal, Amazon Pay and Authorize.Net payments. You don’t need to worry about using either one of these payment gateways. All of the top-of-the line e-commerce platforms work well with them – I am referring to platforms like Shopify and BigCommerce.

You can find out which payment gateways your platform uses by visiting the official extension catalog of the platform or documentation, and then looking at the “payments” section. Here are some places to start:

Would you like customers to pay directly from your website?

Technically speaking, there are three options for taking payment details from customers:

  • You can use the payment form to make payments on your website. The details will be sent to your server. Your customer will find it easiest to checkout by entering their payment details in a regular form on your website. This is not the most secure method of ordering. You’ll need to take extreme security precautions to ensure your site remains PCI compliant . This is unlikely to work if you are making millions each year.
  • Redirect or iFrame . You can also include the checkout form within a secure iFrame on your website or redirect customers to a hosted outside payment page. These methods are more difficult to make the payment form match the rest on your site, but they are the most secure.
  • A payment form for your site. Details sent directly from your browser via a secure gateway (not through your server). This is a type of middle-ground solution. This is how most modern payment gateways, like Stripe for example, work. Stripe allows customers to enter their credit card details on your website. The data is sent directly to Stripe’s servers via secure channels. Your web server does not store credit card information.
  • Would you like to work with one company as a payment gateway and processor?
  • Payment gateways and processors are two distinct things ( read more). Both are necessary to allow people to buy from your ecommerce store. A merchant account is required if you don’t have the financial means to open one. This allows you to take credit card payments from customers directly.
  • It is very common for one company to provide you with a payment gateway and also process the payments. This simplifies integration and reduces complexity.
  • PayPal and Stripe are payment providers that offer this combination of processor setup and payment gateway. In effect, you’re using their merchant accounts.
  • Some payment providers, such as SagePay and PayPoint, offer only a payment gateway (the technology that connects your website to the payment processor). You will need to own your merchant account.
  • As I mentioned, opening an account with one the “combined providers” is easier than opening a merchant account. There are also fewer set-up fees and monthly fees. However, the per-transaction fees are usually higher. Small merchants might want to sign up for a combined payment provider because they are less expensive. Merchants with larger merchants will typically be able to save money by opening their own merchant account.

Would you like to use more than one payment method?

This is perhaps the most surprising aspect of the whole discussion.

You can use multiple payment gateways in your ecommerce store to make it clear.


Simple. Customers might prefer one payment method over another. This means that your customers might prefer a particular payment method to you.

PayPal is the most well-known and essential payment gateway. PayPal is available in all countries and allows you to sell internationally. Many people have PayPal accounts (read our full PayPal review), and many prefer to pay via PayPal over entering credit card details on yet another website.

You can offer PayPal to your customers as an alternative payment method, even if PayPal is not your primary payment gateway. You can use it as a backup for your merchant account or primary payment gateway.

What are the acceptable fees?

Merchant accounts and payment gateways charge a variety of fees. These fees can include fixed monthly fees, fixed transaction fees, variable fees based upon a percentage of the amount and additional fees such as chargebacks or payments from international credit cards.

Before you make any commitments to your gateway, double-check that you are fully aware of the fees involved.

At the very least, you can expect to pay around 2.9% + 30C per transaction. Anything less than this is fantastic!

Are you able to commit for a longer period of time?

Some payment providers are known to lock merchants into long contracts that last for at least two years. If you are unhappy with your provider after signing up, this can lead to problems. Others providers will happily allow merchants to use them on a rolling monthly contract, or even without any contract.

These long contracts are often the domain of smaller payment gateways.

However, it is important to fully understand the type of payment you are signing up for. Before signing up, make sure you review the rules and regulations of your payment gateway.

Is the provider well-respected?

Although it may seem obvious to ask this question, it can be difficult to confirm if you look at reviews online.

No matter what payment gateway you use, there will always be negative reviews. There are at most two reasons.

  • Payment gateways process millions of payments each year. Sometimes, payments may fail.
  • People tend to be more vocal when they are unhappy about something than when everything is going well.

Payment processing is a critical part of your business. Therefore, you will want to partner with a provider with a good reputation in this industry.

Payment providers can experience outages. Some payment providers have a bad reputation for preventing merchants from receiving their money. Be cautious if you’ve never heard of this payment provider before.

You should be fine as long as the payment gateway is large and the processor has been around for some time.

What features are you looking for?

All payment gateways may not be created equal. If you only need to process one-off payments, then they will be similar. Sometimes, however, your gateway might be required to do more.

Are you interested in recurring payments? This is useful if your products are subscription-based. You might also want to be a marketplace that accepts payments on behalf sellers who list their products on your website. Many payment gateways offer very limited functionality. Make sure you have the right features.

Does your payment gateway accept the payment methods that your target market uses

Online payment options are plentiful. These range from well-known cards such as Visa and MasterCard to niche payment methods that can be used in just a few countries.

Each payment gateway can accept a different number of payment methods. You should understand the preferred payment methods of your target market before you choose a payment gateway. You will lose sales if your website does not accept the preferred payment method of your customers.

Check out the websites of your competitors to see what payment methods they offer.

Are You in a High-Risk Business?

Payment providers consider some businesses high-risk. It is usually due to the industry they work in. Some high-risk sectors include:

  • Gambling
  • Adult content
  • Travel
  • Tobacco
  • Collection of debt
  • Electronic cigarettes
  • Credit repair
  • MLM

Many payment providers may not want to work with businesses that are in these niches. You will need to partner with a provider who specializes in high-risk payment processing.


5 popular payment gateways to be aware

These are the top payment gateways on the market. We discuss their pros and cons as well as the costs involved in working with them.

Note. All payment gateways listed below are verified to meet the above requirements. There are only five of them.

  1. Payline

Payment line is in the payment gateway industry for some time now. They have clear fees and offer a interchange-plus pricing.

This might be the best option if you accept credit cards primarily. This model charges you based on the associated transaction fees for each card and the operator’s fee.

To work with Payline, you will need a separate merchant accounts. This can make it more difficult if you are just starting with an new e-commerce store .

Payline is more of a payment gateway that you can use, so it’s up for you to create recurring payments and other non-standard payment methods. Implementing a particular solution may be more difficult and thus more suitable for established businesses.


  • The interchange-plus pricing model means that you are charged the cost of processing the credit card + 0.3% of each transaction amount. You can negotiate the fee amount down to 0.2% if your volume is sufficient.
  • To keep your account active, there is a $10 monthly fee.


  1. Stripe

Stripe is the most widely used payment gateway on the market. Stripe has enjoyed a loyal customer base due to its clear fee structure, integration with all major ecommerce systems, and simple interface.

Stripe is the most developer-friendly payment gateway available. Although this might sound daunting to some, it really means that Stripe can be tailored to your business’ needs.

Stripe allows you to manage one-off payments, bill customers on an ongoing basis, create a marketplace or handle in-person payments.

Stripe guarantees transaction security, and stores all credit card numbers in a secure manner (using good AES256 encryption keys).


  • Stripe is PCI DSS Level 1 certified
  • Issues SSAE18/SOC1 type 1 and 2 reports
  • Licenses for Money Transmitter Licenses in the USA, AFSL in Australia and E-Money Licenses in Europe. Registered MSB in Canada
  • Are PSD2 and Strong Customer Authentication compliant in the EU?
  • Works with 135+ currencies
  • currently available in 30+ countries
  • It works with many third-party platforms and tools – see: it will work with your ecommerce provider for certain

You can also get 24×7 customer support via chat, email, and phone.


  • 2.9% + 30C/ for credit card transactions within the US
  • International cards accepted at a +11%


  1. Authorize.Net

Authorize.Net has been around since 1996 and is the most well-known and longest-running payment gateway on the internet. Since 1996, they have made it possible for any business to accept online payments.

Authorize.Net makes it possible to accept credit cards, contactless payment, and echecks.

Advanced fraud detection can also be used to protect your business from unauthorised payments and other payment-related problems.


Authorize.Net is a secure storage platform that protects your customers’ information and allows you tokenize sensitive data.

Authorize.Net can issue invoices and set up recurring payment schedules based on your business’ needs. It also offers a simplified checkout process.


  • All-in-One: For businesses without a merchant account, $25 per month, 2.9% + 30C/ transaction
  • Payment Gateway: Only for businesses with a merchant account. $25 per month, 10C/per transaction
  • Enterprise Solutions for Businesses that Process More Than $500K per Year


  1. PayPal

PayPal has the most well-known and recognized payment processor / solution / payment gateway.

PayPal is more than a gateway for business owners to integrate with their ecommerce shops. Many casual users have PayPal accounts and use it to make casual payments online or to split bills with friends.

PayPal is the best payment gateway to your e-commerce shop. It’s the only solution that will guarantee you can sell your products to anyone.


You should be aware of the different options available to you as a business owner.

  • Standard PayPal Payments
  • PayPal Express Checkout
  • PayPal Payments Pro

While the differences may not be that significant, they can be very important depending on what products you sell.

PayPal Payments Standard works very similar to PayPal Express checkout. Standard works in a similar way. The customer creates an account on your website, customizes it, and is then redirected to PayPal to complete the payment.

PayPal Express will redirect the customer to PayPal to authorise the charge, but they won’t be able to complete the checkout process. Instead, the customer will be able return to your website to customize their order and then get charged in the background.

PayPal Payments Pro allows you to personalize the checkout process and your customer stays on your website the whole time. PayPal Payments Pro is currently only available in a few countries.

Here are some more details about PayPal as a payment method:

  • PayPal is available to all users without a merchant account
  • you get advanced fraud protection
  • Invoices can be issued
  • You can quickly withdraw money to your local bank account.


  • PayPal Payments Standard: 2.9% +30C/ per Transaction; volume discounts are available if you process many payments
  • PayPal Express Checkout 2.9% + 30C/per transaction
  • PayPal Payments Pro: 2.9% + 30C/ per transaction; plus $30 per month


  1. 2Checkout

2Checkout is a company that has been in existence since 2006 and offers services in more than 180 countries.

They offer a complete solution for processing payments online. You have access to an advanced platform that allows you to manage your company’s finances and ecommerce efforts.

2Checkout’s unique feature is the ability to integrate with any e-commerce platform. You also have access to a hosted shopping portal that has been designed with the highest standards and optimized for maximum conversion. You can work directly with 2Checkout without the need to integrate it with any other e-commerce platform. This is a great option for small businesses who don’t have an ecommerce solution.


Additional details about 2Checkout’s offer:

  • Works in over 100 languages
  • Localized checkout available for countries supported
  • Integrates with over 120 e-commerce platforms
  • Accepts all major credit cards as well as PayPal payments
  • The “2Comply” add-on allows advanced tax and VAT handling.


  • “2Sell” is an easy way to sell internationally. 3.5% + 30C/ transaction
  • “2Subscribe” is for subscription businesses; 4.5% + $40C/per transaction
  • “2Monetize”, an all-in-one platform to sell digital goods worldwide; 6% + 50C/per transaction

Although this pricing might seem more expensive than other options on the list, it comes with a lot of additional features, especially if you choose the second and third plans.


This is your first lesson about what a payment gateway looks like and which gateways are the best.

Each of these options will let you collect payments from customers the same way. The main difference lies in the features and overall experience of using the gateway to integrate it with your ecommerce store.

To help you make a decision, here’s a summary table:

Payment gateway Prices starting at Editor’s Rating
Payline Credit card fees + 0.3% per transaction + 10 per month
Stripe 2.9% + 30C/per transaction
Authorize.Net 2.9% + 30C/ per transaction + $25 per month
PayPal 2.9% + 30C/per transaction
2Checkout 3.5% + 30C/per transaction

These payment gateways aside, there is one other thing you should look at before you consider your ecommerce setup complete. This is especially true if you plan to work with multiple currencies.

The problem with multiple currencies is that conversion fees can be high when withdrawing funds or processing them. You should consider adding Transfer Wise to Business to your payment gateway.

Transfer Wise offers a truly innovative financial service. It provides local bank details for the UK and Euro zone, Australia, as well as the US, without the need to have a physical address. You can also request payments from the US, Australia and UK as if you were there. This allows you to withdraw money at low fees and reduces currency conversion costs.

Transfer Wise can also work in the reverse direction, so it’s your best option to pay invoices or send payments to global suppliers.

This concludes the discussion on payment portals and how you can choose the best one. We are happy to help you decide if there is anything unclear.

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