Best Payment Processing Companies of 2024

When selecting a payment processor for your business, there are several features you’ll want to consider.

When selecting a payment processor for your business, there are several features you’ll want to consider.

Pricing and Fees

All card associations establish rates based on numerous factors, including the card brand (Visa or American Express), type (rewards or store card), and the merchant’s industry. These rates are variable and non-negotiable. The payment processor subtracts these fees from funds paid to your company from customers.

In addition, the processor takes a portion to cover their costs. This may be a flat or variable rate. Some merchant account providers will negotiate rates and consider factors like years in business, credit history, and processing volume. Others provide flat fees to all merchants processing less than $250,000 annually.

On top of per-transaction costs, providers may have fixed monthly subscription fees and add-on charges for services. For instance, you may pay extra for virtual terminals, payment gateways, hardware, and PCI compliance. Most merchants incur chargeback fees when customers dispute payments. Also, payment processors may charge administrative fees for batch settlements, statements, account setup, or early cancellation.

Security and Fraud Protection 

Any individual or company that accepts, processes, stores, or transmits credit card data must follow Payment Card Industry Data Security Standards (PCI DSS). Sudhir Khatwani, director of The Money Mongers, Inc., says businesses should complete a “thorough examination of the vendor’s security measures and adherence to industry standards is crucial to safeguard against potential breaches.”

Joseph Braithwaite, managing partner at EvolveThinking, suggests looking at “how financially stable” the vendors are and their data retention practices. “For instance, many banks can meet PCI’s data and process requirements, but they retain their data for too long, leaving them open to massive legal actions if they are ever hacked,” he notes

Credit card processors provide terminals with end-to-end encryption (E2EE) to ensure safe in-person payments and also hosted payment pages, which can shift PCI liability from the business owner to the payment processor. In addition, some providers use advanced fraud detection and prevention tools. These use machine learning to assess transactions and risks, detect irregular payments, and deny high-risk transactions.

Merchants in industries prone to fraud or chargebacks may prefer a provider that offers additional fraud protection measures. Typically, you pay a few more cents per transaction for advanced screening tools. Payment processing companies may also provide chargeback protection insurance covering the disputed amount and fees.

Integration and Compatibility

The best payment processing company for your business should work anywhere you sell products or services. As Broch says, “Payment processing is that last step, so it is a make-or-break moment.”

Before beginning your search, consider existing hardware and software, such as POS systems, credit card terminals, and accounting programs. Also, review your online applications. Not all payment processors play nicely with e-commerce systems. And some online stores charge fees if you use a third-party processor instead of the supplied payment solution.

Even if the payment processor says it’s compatible with your online shop, it’s crucial to learn what this means. Will your buyer be able to complete checkout from your website, or will they be redirected to another web page? A business with an in-house developer or IT staff is better equipped to handle the advanced configurations required to connect payment processing services to business tools. Those lacking technical support may prefer a solution with built-in software integrations.

Additional Features and Value-added Services

Many payment processors go above and beyond facilitating transactions. They understand that the success of your business benefits them. Therefore, providers offer free software and services.

A virtual terminal is a tool every business owner should look at when choosing a payment processor. It lets you take credit and debit cards from any internet-connected device. Several vendors also have POS systems.

Complimentary POS software can save your company a lot of money and deliver powerful insights. You can track inventory, view sales reports, and monitor employee usage.

Invoicing features are valuable for getting clients to click to pay. With a surcharge program, you can incentivize customers to pay via ACH. This tool is especially helpful if the provider’s software integrates with your accounting program.

Online checkout, hosted payment pages, and payment links are all excellent options for freelancers, startups, and small businesses.

The payment processor provides tools that let you start selling from anywhere without any technical experience. You can build an e-commerce website, add a checkout page to your current site, or create a landing page to process payments – all for free.

Lastly, if your business model is subscription-based, you need a way to handle recurring payments and payment failures. Broch finds Stripe’s “sophisticated payment failure retry system” beneficial. It allows customers “to charge a card at the most optimal time.”