One Question to Ask Before Evaluating Payment Processors

September 20, 2017 Payments
Robert Carlson
By Robert Carlson, WePay Business Development MBA Intern
Robert Carlson
By Robert Carlson, WePay Business Development MBA Intern

One Question

You have a lot on your mind. Running an ecommerce platform isn’t easy. You don’t have a lot of time to think about what payment processor you want to partner with. Before you go and sign up for one, however, it’s in your best interest to stop, take a deep breath, and take a moment to think a bit more about your business. Specifically, think about the one question that will help determine which company you partner with: what is your true business objective with payments?

As you might expect, with so many ecommerce companies, each with their own strategy, product, and customers, your answer to the question will likely differ from other companies. No one processor is right for every company. To help, we’ve listed some of the most common answers.

  • Connectivity: Your objective is speed to payments. You need to start accepting them as soon as possible and don’t care about any other features. This is a price play for you. Luckily, there are a number of providers who can offer you very low rates.
  • Engagement: Above all else, you care about how users experience your website and company. For platforms, this includes your merchant experience, which covers how easy it is for them to sign up to start receiving payments as well as the systems in place to allow them to handle administrative issues they may have. You also care about the payer experience, including how easy it is for somebody to pay for services. Engagement requires a stronger partnership with your processor to make sure you get exactly what you want.
  • Revenue: Perhaps you’ve heard of “payment monetization.” That’s just a fancy term for you, the ecommerce company, getting a portion of what the processor would normally receive from processing payments. When a payer goes to purchase, he or she will only see the processing rate (e.g. 2.9% + $0.30), not who gets what. While your portion of the rate might be small, this adds up along with your site growth. Some companies want a diversified revenue source and others do not. It’s always good to have the option.
  • Risk: You may have different reasons for seeking a processor with sophisticated risk management capabilities. Perhaps you run a riskier business and you’re worried about fraud or high rates of payer dissatisfaction. Maybe you want to make sure that, as your business grows, fraud doesn’t grow along with it. Or, it could be that you realize risk management is more than just fraud, and can actually improve your business financials.
  • Partnership: You want to accept payments but you don’t have a long-term vision for what you want to do in the future. You do know, however, that you want a partner, an expert who will pick up the phone when you call and who will answer your emails when you run into problems. You want a company who will actively think about what’s in your best interest – long after you’ve signed a contract.
  • Features: Many companies have specific payment features that are key to their business strategy. You may need a mobile point of sale (mPOS) solution so your merchants can accept payments in stores as well as online. Alternatively, maybe you want a push-to-debit solution so your merchants get access to their cash immediately.
  • Data: Payments is not your end game. You want to control access to the transaction data on your platform. Perhaps you want to offer analytical features to your merchants or maybe you want to offer small business loans. To do this, you need a provider who enables you to monitor and understand the data.

While not all-inclusive, hopefully this list gave you something to think about before beginning your payments buying process. If you’re interested in what other questions you should be asking, feel free to reach out at

About the author

Robert Carlson

Robert Carlson, WePay Business Development MBA Intern

Robert Carlson is an MBA intern at WePay and a current MBA candidate focused on payment strategy and revenue scalability, after time in national security and management consulting. He is always up for lengthy discussions concerning cooking, coffee, craft beer, and the best dog breed (there is only one correct answer, and it is German Shepherd).

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