How to Accept Payments Online

How to Accept Payments Online

How to Accept Payments Online

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In an increasingly online world, more and more small businesses have had to start offering a way to accept payments online. In fact, most customers expect to be able to pay online now. Online payments allow customers to pay with credit cards, debit cards, direct transfers from their bank account, or with a digital wallet, which makes it more convenient for both them and you. It also allows you to expand your business to customers who want to buy your goods or services whenever and wherever they want through any form of payment.

How Do I Start Accepting Online Payments?

There are few aspects of electronic payments: merchant accounts, payment gateways, and payment processors. Each plays an important role in the online payment process, and it’s a good idea to understand the difference between payment processors and payment gateways.

How merchant accounts work

Your merchant account is basically your bank account for your business at the payment processor. When you use a payment processor, you apply for a merchant account so that you can receive payments. This is the first step in accepting payments online. 

How payment gateways work

A payment gateway is a software or platform that securely transmits payment data to the processor. It’s the technology on the front end of your store that reads the debit or credit card information and sends it to your bank to process. Basically, a payment gateway is the part of a payment processor that transmits payment information to finish a transaction. They transfer the credit or debit card details between the customer’s bank and your merchant account. 

You may choose a payment gateway to manage credit card payments and other transactions. Many payment processors supply you with their own payment gateway, which can make it easier to process payments without errors quickly and make it easier for you to reconcile accounts. They also provide customer service so you can handle disputes. 

How payment processors work

A payment processor is a facilitator that allows you to handle transactions from end-to-end, from the moment your customer starts the transaction all the way to when you get the payment in your bank account. They’re generally banks or other financial entities with the authority to process your payments. Payment processors can handle multiple currencies for you if you happen to do business overseas, although there may be fees associated with these transactions. 

The processor acts as a mediator between you (the merchant) and your customers’ banks or other financial institutions involved in the transaction. All card-based payments must be handled through a payment processor, regardless of whether it’s done from your website, at your store, or on a customer’s mobile device. 

When you use a payment processor, the provider will most likely give you other merchant services like card readers or other equipment to accept card payments in-person, as well as services such as customer service for your clients if there’s a payment dispute. Payment processors also handle the security aspect of your customers’ data and can help you manage payment card industry (PCI) compliance, which is a very important aspect of handling online payments. 

How payment processors handle your merchant account

There are two types of payment processors: merchant account providers and payment service providers (or aggregators). Merchant account providers give you a specific merchant ID (MID) with a dedicated merchant account for your business (and only your business). This option gives you more control over how you present payment options to your customers through customizable options, but it takes longer to get approved.

Payment service providers give multiple businesses a single MID as a group, which means the approval process is shorter and you may have an off-the-shelf solution that will allow you to accept payments pretty much immediately. On the other hand, the pooled risk associated with payment service providers means you may have more customer service issues like payment terminations, chargebacks, and account freezes. 

Payment Processors to Consider

There are many payment processors in the marketplace, so it’s important to decide which one is best for your small business. If you already have a business banking account or relationship with a financial institution, it may be best to work with them to develop your merchant account and set up online payments.

Other popular options include:

Chase Payment Solutions

Get flexible payment options, 24/7 support, and a highly secure platform. You can also use Chase as a bigger banking solution.

Chase Payment Solutions℠

Never miss a sale with powerful new ways to accept credit cards, anytime, anywhere. Accept Learn More


It offers many point of sale (POS) solutions, flat rates, and no contracts.


It offers POS tools, flat-rate pricing, no long-term contracts, and a free ecommerce store.


Flat-rate pricing makes it easy to fit them into your budget, and it integrates with QuickBooks for easy accounting.


For more high-risk merchants, they have a high approval rate and month-to-month pricing.


Pay-as-you-go pricing, easy integrations, and no setup fees make this a great option for small businesses. It also offers customizable solutions as you grow.

5 Ways to Accept Payments Online

Depending on the nature of your business and how your customers interact with you, there are several ways to accept payments online. Here are our top five:

1. Accept cards

Accepting major credit cards and debit cards like Visa, Mastercard, Discover, or American Express is probably the most popular way to accept online payments. For simple credit card payments, you can use an online service provider like PayPal, Zelle, or Stripe, which offer easy integrations with your website building platform. You should be able to just click a button to connect your payment account to your website without needing to write any code. You can also copy-paste the code to create a payment button right on your site. 

Other ecommerce platforms like WooCommerce or Shopify can provide more robust credit card payment options if you’re building an ecommerce website or online store. They provide excellent functionality for creating an online store to make it easier for your customers to buy your goods. They also integrate with popular web hosting services and platforms to make it easy to create an online checkout for your customers. 

2. Accept Automated Clearing House (ACH) payments and electronic checks

Some customers want to pay directly from their checking or savings accounts through a bank transfer, but don’t want to go through the hassle of mailing you a check, which is where automated clearing house (ACH) or electronic check (echeck) payments come in. To accept ACH payments and echecks, you have to provide the customer with your bank’s routing number and account number for direct deposit. They’ll need to use a payment service provider to make the payment on their end, such as Stax or Gusto. 

However, this isn’t the safest way to handle payments — a customer could use your deposit information as their own. Going through a payment processor like Stripe to accept ACH payments is a safer option and more convenient for your customers. 

3. Accept payments via mobile

There are many safe and secure ways to accept payments through mobile devices. Mobile wallets may be the most popular, because they handle all the coding and just allow you to use a link. Apple Pay, Google Pay, and Samsung Pay are all easy ways to accept payments from mobile users. All of these options also allow for contactless payments, which are increasingly popular for quick transactions in-person. You can also accept mobile payments via your mobile app through these same services. 

4. Accept payments via invoice

If you’re a contractor or service provider and don’t have an online store, invoicing is an easy way to accept payments online. There are many invoicing platforms to choose from that integrate with payment service providers like Zelle, Venmo, Paypal, Stripe, and Square. If you use a time tracking application for your work, you may be able to generate invoices via email directly from the app which will allow your clients to pay with the click of a button from their email. This method also allows you to accept which types of payments you’re willing to accept. 

5. Accept payments via recurring billing

If you regularly provide a service to your customers on a regular basis, allowing them to schedule payments through recurring billing saves you both time and hassle. This is a great option if you offer memberships or other recurring services. You can use an automated billing software system that allows your clients to pay weekly or monthly, and they can pay with their preferred payment method (or yours). This helps you ensure you’ll be paid on time, helping you get a better handle on your cash flow throughout the month. 

How Much Does it Cost to Accept Payments Online?

Depending on the payment platform and method you choose, the costs of accepting payments online can range greatly. You’ll have to pay an interchange fee — there’s no legal way to accept credit card payments without paying the interchange fee, which your payment processor generally pays on your behalf but will include in the cost of doing business with them. It’s also illegal to pass these fees on to your customers, although many small businesses will offer discounts or incentives for paying via ACH or cash. Most payment processors will build these costs into their pricing models, which can save you a lot of guesswork in the long run, but this may not be the most cost-effective way for you to accept credit card transactions. 

Here are some of the costs of accepting online payments to look out for: 

  • Transaction fees — If you’re using Square or PayPal to accept payments, you can expect to pay a flat percentage fee of 3% or less per transaction, regardless of whether it’s paid via credit card or another method. 
  • Monthly fees — You may find that a payment processor offers lower charges per transaction, but may charge you monthly fees. Depending on how much business you do online, this may be better or worse for your business model. 
  • Set-up fees — If you work with a traditional payment processor like a bank, they may charge you a set-up fee, including application processing fees.
  • Transaction minimums — some providers will require that you process a minimum of transactions per month to avoid paying a penalty fee. Some may also require you to sign up for a yearly (or longer) contract. 

An easy way to lower your costs for accepting online payments is to find a website hosting solution that will allow you integrate less expensive payment processing options directly into your site. 

Deciding What Online Payment Processing Pricing Model Works for You

When picking a pricing model for your online payment system, you’ll need to first consider how many estimated credit card transactions you’ll have per month. If most or all of your customers pay using credit cards — you run an online store, for example — you might want to choose to have the interchange fee incorporated into your contract and pay a monthly fee rather than per transaction. On the other hand, if you run a small business and only sell a few items online, you may want to pay per transaction. 

Also think about your average sale amount. If each sale is typically for a small amount, you may want to avoid an account that charges a fee for transaction minimums. 

If you’re struggling to pay for your payment processor, consider business credit cards or small business loans to help with your cash flow. Use Nav to find the best funding options for you based on your business details.

Best Merchant Service for Small Businesses

The best merchant services account is the one that works for your business. Choosing a merchant services account means considering your industry, the type of business you run, and the volume of your sales. Just like with a small business credit card, you do need to apply for a merchant service account, although the process is simple. The right merchant service account for you will be affordable, reliable, and easy to use.

Overall, online payment services are an excellent way to make your goods and services more accessible to clients. They can help you grow your business to a wider audience and make your accounting processes more efficient.

FAQS on Accepting Payments Online

This article was originally written on April 21, 2022 and updated on February 17, 2023.

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