Payment Gateway Comparison – Paypal, SagePay, WorldPay, HSBC & Barclays

6 June 2017

E-commerce is rapidly becoming a major player on the retail landscape. Estimates from IMRG have predicted that spending online in 2017 will grow a further 14% on 2016’s sales which totalled £133bn. More than 95% of UK shoppers have bought something online, whether a gift or a grocery shop. Sales from mobile devices have grown by 47% YoY and this highlights just how important it is to ensure a smooth online mobile user experience.

What is a Payment Gateway?

A payment gateway is the infrastructure that allows people to pay for goods and services from an e-commerce retailer. The service is added to an e-commerce retailer’s site through a third party. A payment gateway authorises credit and debit cards for online merchants, processing the payments into the merchant’s account.

We have recently tried to research five of the most popular payment gateways but found that it was difficult to find information which would help our clients to decide which payment gateway to choose. In order to make this information more accessible for businesses, we contacted these payment gateway providers and compiled our finding in the table below.

Payment Gateway Paypal WorldPay HSBC SagePay Barclays
Set Up Cost FREE *costs apply to Payment Gateway Pro accounts FREE Setup fee determined by business type FREE Setup fee determined by business type
Monthly Cost None £19.95 Determined by business type £19.90 £24.40
Charge Per Transaction 3.4% of sale + 20p per transaction for credit and debit cards 2.75% fee for credit cards 39p per debit card 1.6% fee for credit cards 17p per debit card 1.9% fee for credit cards 40p per debit cards 1.5% of sale
Free Transactions Per Month No 350 No 1,000 No
Average Time to Set Up 15 Minutes 1 – 7 working days 7 – 10 working days 10 – 15 working days 10 – 14 working days
Time Before Money Becomes Available Immediately* merchants must supply full bank account number and sort code for withdrawals 1 – 4 weeks (due to change to 7 days shortly) HSBC account holders within 3 days (non HSBC accounts up to 10 days) 24 – 48 hours* depending on merchant bank account 3 – 4 working days* depending on merchant bank account
Discount For Non Profit Organisations Yes 1.4% + 20p for all transactions Yes UK registered charities only No No
Contract Length No minimum contract 36 months minimum contract (fees apply for early cancellation) 12 month minimum contract No minimum contract (3 months cancellation notice may apply to some accounts) 18 month minimum contract

PayPal

PayPal is the most famous payment gateway brand, perhaps because of its ties with its parent company, eBay. However, PayPal is more than an eBay tool, spreading throughout the web.

PayPal operates a staggered rate of payment for merchants depending on how many transactions are made each month. It is easy to integrate with most sites and is a highly trusted brand for most users. However, PayPal can work out expensive for retailers with high volume and there are many forum posts around which berate the way that PayPal favours customers over retailers, leading some to disavow from the payment gateway claiming it having poor customer service as well as being tyrannical in their account suspensions.

SagePay

SagePay are the biggest independent payment gateway service provider in Europe, and a well respected brand throughout the UK.

For e-commerce businesses with a reasonable turnover, their fees of 1,000 transactions per quarter plus 10p for each additional transaction are very enticing. Along with their free customer support which can help you deal with any small niggle or issue, they are a great option for businesses  looking to partner with a company with the experience required for e-commerce, without having to pay through the nose for it. If you need help setting up a SagePay account check our blog post on SagePay dummy card details

Worldpay

Worldpay were one of the first payment systems on the internet in 1994. Quarter of a century later (really? That long?), they still process millions of pounds worth of payment transactions each month.

The experience that Worldpay bring to the world of online payment comes at a hefty cost, however.  They charge 2.75% transaction fee for credit cards and 39p for debit card, which soon adds up to a lot for popular e-commerce stores.

HSBC

HSBC, ‘The World’s Bank’, changed the name of their online merchant services to Global Payments in 2012. They partner with Realex Payments to provide e-commerce businesses with a flexible payment gateway suitable for their individual needs.

The set up fee depends on your business type and your turnover. There is a 1.6% charge for each credit card transaction and 17p for each debit card transaction can seem quite steep, especially as their customer service is reportedly decidedly average.

Barclays

Barclays’s payment gateway is called ePDQ and comes in a variety of packages to suit different businesses. 

As the service is run as part of the Barclaycard arm of Barclays, this option can be difficult to get if you have CCJs or poor credit. The fees are also high, but the customer service from Barclays is excellent. If you already bank with them, it can be easier to simply add this onto your business banking package.

Our Verdict

After listening to our clients feedback about the different payment gateways they use, there has been one payment gateway which stands out from the rest – SagePay. With excellent customer service and a low cost per transaction, SagePay is an excellent choice for any business looking for an online payment gateway. We have managed to negotiate with sage pay one month’s free contract fee* for all clients that register using this link. *Does not cover credit card and debit card transaction charges.

If you would like to find out more information about how we can help you to build your online store, visit our E-Commerce Services page or get in touch with us today.