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Choosing the Best Electronic Payment Method

10/2/2013

 
We are often asked, "Which payment methods should I offer my customers?" We always recommend using electronic check transfers as your primary method of payment as this is the most affordable option. If you would also like to offer payment by credit card, you have two options - a credit card processor (we recommend PowerPay but you can use whatever credit card processor you prefer) or Paypal.

Our Recommendation: Farmigo will support any decision you make for accepting credit card payment, but we do NOT recommend using PayPal. After four years and millions of transactions later, we have seen that consumers prefer credit card payment over PayPal.  In addition, there have been numerous occasions when PayPal has not properly processed member payment. In spite of our efforts to have them correct these issues, we have found PayPal's customer support slow and at times unresponsive.

In today’s tip, we want to provide you with some insight about the benefits of using a credit card processor over Paypal. You are welcome to use any credit card processor, but we are going to use Powerpay as our example in this analysis. To learn more about other credit card processors, click here.

There are a few variables to consider when choosing between PayPal, Powerpay, or another merchant provider. These include:
  • Cost of Service
  • User Interface
  • Quality of Customer Support

Read on to learn more.

Cost of Service Comparison

The cost of service for your credit card processing options will vary depending on your total number of transactions and the value of each of these transactions. At first glance, it may appear that Paypal is the cheaper option, however, we strongly recommend doing a cost analysis based on your projected sales to help you decide which option will be most affordable. As your business grows, and you gain more members, there is a point where a credit card processor + Authorize.net will become the less expensive option. This will depend on the number of transactions that are executed by your members and the value of each transaction. For this reason, we recommend that you do your own cost analysis.

The basic costs related to Powerpay & Authorize.net and PayPal services are as follows:

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* Customer Information Manager is only needed for businesses that wish to allow repeat automatic payments from customers

User Interface Comparison

Another variable to consider when choosing between PayPal or a credit card processor is the ease of use for members within the Farmigo system.

When members choose to sign-up and pay with credit card, they complete the sign-up process within your Farmigo sign-up link. The benefits to remaining within the Farmigo sign-up links are that:
  1. Members can go back in the sign-up process and review or change their order
  2. When members complete sign-up they get a certificate they can share with social media which can help encourage more sign-ups! 
When a customer chooses to pay with Paypal, they are redirected to Paypal.com to complete the sign-up process. If they hit the back button, they will be required to restart the sign-up process. Additionally, we have gotten feedback from customers that Paypal causes confusion as there are extra steps for creating a PayPal account.
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Quality of Customer Support Comparison

It is important to find a credit card processor that has quality customer support in case any issue arrises. At Powerpay, we have a customer support representative, Jason, committed to helping you. You can call or email him directly and you will get a response from him within 1 business day. If there is ever an issue with a payment, Jason is extremely helpful and will work hard to ensure that he delivers quality customer service. 

PayPal’s customer support does not provide timely responses, particularly for escalated concerns. We have experienced this first hand when trying to assist our clients on phone calls with PayPal support. There are many reports online that PayPal has been known to hold money, freeze, and even terminate accounts. The last thing you want is for all of your cash to be tied up by PayPal because getting it from them may turn into a long and arduous process.

Final Verdict

We recommend using electronic check payment as your primary payment method as it is the cheapest option. If you would also like to offer credit card, we recommend using a credit card processor. 

You can use Powerpay or do research to find the processor that is best for you! For more information and reviews on different merchant providers, click here: http://www.merchantmaverick.com/

Amy Tisdale
10/23/2013 06:38:15 am

Are you considering adding Google Wallet as a payment option? We do a CSA pickup at the Google office in Boulder, CO. They have invited our business to use Google Wallet.


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