Online Payments: Theory for Understanding

To accept payments in an online shop, merchants need an acceptance contract with an acquirer and a processing contract with a payment provider. The following explains exactly what an acquirer and a payment provider are and how interaction with the online shop works.

What is a Payment Provider (PSP)?

Companies responsible for the technical integration of online payment methods in online shops are called payment providers, or Payment Service Providers (PSP). An online merchant only needs to negotiate with a payment provider to obtain all the desired payment methods, integration systems, and e-commerce tools and meet security requirements. The corresponding contract with the payment provider is called a processing contract, as it relates to the technical handling and processing of payments.

Functionality of a Payment Provider (PSP)

What is an Acquirer and an Acceptance Contract?

An acquiring or acceptance contract is an agreement between a merchant and an acquirer (also called an acquiring bank). This contract governs the acceptance and processing of credit card payments and other electronic payments. The acquiring bank is the financial institution that processes card payments for merchants. Merchants can conclude an acceptance contract with acquirers such as Worldline or Concardis, or also with a payment facilitator (PF) like Payrexx.

What is a Payment Facilitator?

A payment facilitator (also PF or collecting PSP) is in direct contact with the merchant and manages the account with the acquirer. The payment facilitator can sign the acceptance contract on behalf of the acquirer, thus facilitating setup because the merchant has fewer direct relationships. The payment facilitator enables the integration of various payment methods into the online shop with just one contract.

Functionality of a Payment Facilitator (PF)

How to Choose the Right Provider?

For merchants, a simple and reliable connection, a wide range of payment methods and tools, good support, and a cost-effective payment provider to avoid unnecessary costs are crucial. Additionally, every online shop should clarify the following requirements:

• Which payment methods should be offered in the online shop? Not every provider supports all conventional payment methods. Different payment methods are available depending on the region or origin of the provider.

• Which tools are needed for the online shop? Each provider offers a slightly different range of integrated e-commerce tools. Some providers specialize in donation pages, others in online shops. Some offer an all-in-one solution for different business models.

• Which shop system do you use? Most providers offer plugins for the most well-known shop solutions* to integrate the payment solution into the online shop. If you do not yet have your own shop or it has been self-developed, there are some providers that have a solution for every case.

• How is payment security ensured? A payment provider meets the highest security standards for online payments. By having a contract with a PSP, you also comply with these standards and can guarantee the highest payment security to your customers.

It is advisable to choose a payment provider that is also an acquirer or payment facilitator, so merchants have a single point of contact for everything.

Overview of the Functions of Individual Payment Providers

The following table shows which payment provider offers which payment methods*, which shop systems are compatible, and how the companies are rated on Google.

*The most common methods in Switzerland are listed.

Besides the most well-known shop systems, there are some providers that offer their own shop systems – these require no programming knowledge for setup. In the table, these offers are listed as “Integrated E-Commerce Tools”. This tool enables easy creation of shops for products, vouchers, subscriptions, or donation pages.

Datatrans was merged with Planet, Hoist, protel, and Proximis under the combined brand Planet. In this article, we refer to Datatrans (Planet).

Function Matrix of the Various Payment Providers

**Datatrans was merged with Planet, Hoist, protel, and Proximis under the combined brand Planet. In this article, we therefore refer to “Datatrans (Planet)” and refer to the public conditions of Datatrans.

Cost Analysis

This section provides a calculation of the monthly costs (subscription and transaction fees). The calculation is done once for an online shop with a turnover of EUR 20,000 and once for one with a turnover of EUR 100,000.

For the cost analysis, the cheapest offers of the individual payment providers for the corresponding sales volume were selected. The price information is mostly* taken from the websites of the respective payment service providers. Any setup costs are not included in the diagram.

*In the case of Datatrans’s offer, the acquiring costs are not publicly visible. Therefore, a value of 2% was assumed (average of all other providers).

Online Shops with a Monthly Turnover of EUR 20,000

The cost analysis shows the monthly fees for smaller online shops with a sales volume of EUR 20,000 for 200 credit card transactions per month. The average value of a transaction is therefore EUR 100 per purchase.

Monthly Costs with a Turnover of EUR 20,000 (without Setup)

The lowest fees as a smaller online shop are with Payrexx, closely followed by PostFinance. With costs of EUR 790, PayPal is the most expensive for online shops with this volume. The absolute price difference between Payrexx and PayPal is EUR 441. The costs at the cheapest payment provider Payrexx are therefore more than 50% lower than at the most expensive offer. Additionally, Payrexx offers exclusive discounts of 30% and 50% on all price plans for startups and nonprofit organizations.

Online Shops with a Monthly Turnover of EUR 100,000

The cost analysis shows the monthly fees for medium-sized online shops with a sales volume of EUR 100,000 for 1,000 credit card transactions per month. The average value of a transaction is therefore EUR 100 per purchase.

Monthly Costs with a Turnover of EUR 100,000 (without Setup)

Payrexx is the cheapest provider at EUR 1,549 per month, followed by Wallee. For medium-sized online shops, PayPal, Stripe, and Worldline are significantly more expensive than other providers. Payrexx is a total of EUR 2,401 cheaper than the most expensive provider, representing a price difference of over 60%.

No calculation was made for large online shops, as most payment providers offer individually negotiated conditions for larger customers – e.g., Datatrans, Payrexx, Stripe, Wallee, Worldline, and Zahls.ch.

All Payment Providers in Detail

Payrexx: Payment Facilitator with Integrated E-Commerce Tools

Payrexx is both a payment provider and a payment facilitator. Thanks to a favourable pricing model and a multitude of payment interfaces and e-commerce tools, Payrexx offers a modern and user-friendly all-in-one solution.

With integrated tools such as payment links, a one-page shop with its own URL, virtual terminal, QR-Pay, and digital invoices, Payrexx meets the individual needs of almost every merchant. Payrexx is suitable for selling products, services, online tickets, or vouchers, but also for collecting membership fees or handling donation projects. Thanks to the 30-day trial period, the payment platform can be tested for free. Payrexx has an average Google rating of 4.1 out of 5 stars with a total of 126 reviews.

Price Overview of Payrexx

* Preferential conditions between 1.5% and 1.3%

What Must Merchants Do for Integration?

As each merchant receives a payment website with its own internet address, neither integration nor programming knowledge is necessary. If you already have a shop, you can integrate the payment solution using the available plugins. To register with Payrexx, you only need a valid photo ID and possibly a commercial register entry.

PostFinance Checkout: a Comprehensive E-Payment Solution

PostFinance enjoys great customer acceptance in Switzerland. PostFinance Checkout is a payment solution that offers all conventional payment methods (PostFinance E-Finance, PostFinance Card, TWINT as well as Visa and Mastercard) along with various shop plugins. The prices listed below already include all payment provider and acquiring costs. PostFinance also offers a free 30-day test period in simulation mode. PostFinance has an average Google rating of 2.5 out of 5 stars with 119 reviews.

Price Overview of PostFinance Checkout

What Must Merchants Do for Integration?

PostFinance Checkout is available to all companies with a registered office in Switzerland or the Principality of Liechtenstein that have a business account in EUR with PostFinance.

Worldline: Acquirer and Payment Provider

Worldline offers both acquirer and payment provider services and therefore usually offers bundles. With the Worldline E-Commerce package, payments can be processed directly via a payment window. Transfers are possible in more than 20 currencies, and customers can choose in which currency they wish to pay. This is also because Worldline offers Dynamic Currency Conversion. Furthermore, Worldline provides various payment functions, such as additional charges or partial bookings. Worldline has an average Google rating of 2.8 out of five stars with a total of 420 reviews.

Price Overview of Worldline

What Must Merchants Do for Integration?

No programming skills are required. Worldline is especially suitable for existing e-commerce solutions and static websites.

Datatrans: Experienced Provider

Datatrans is the largest provider in Switzerland and can be integrated as both an external payment option (external payment window) and through an implementation (via API in the shop layout). With the Datatrans Payment Pages, merchants have access to all payment methods with a single integration. Datatrans Secure Fields seamlessly integrate into the design and help improve the merchant's conversion rate. Additionally, you also have the option to create a test account with this provider. Datatrans has an average Google rating of 4.9 out of 5 stars with 16 reviews.

Price Overview of Datatrans

The setup costs are not found on Datatrans’s website, and an average value of EUR 100 was assumed. Additionally, the minimum monthly charge is EUR 290 (excluding external acquiring costs), and external acquiring fees of approximately 2% are added to the Datatrans costs.

What Must Merchants Do for Integration?

Datatrans itself does not have an online shop tool, so you must already own an online shop. This can be a self-developed shop, or you can use a standard shop system. As Datatrans is neither an acquirer nor a payment facilitator, merchants also need acceptance contracts with another acquirer.

PayPal: an International Payment Provider

PayPal is a simple solution for shop providers, but it quickly becomes expensive for larger order volumes. Payment links, email invoices, and various plugins are available. According to its own statements, the payment facilitator PayPal has over 240 million active users and offers the possibility to process payments in over 100 currencies. PayPal is an international provider, allowing merchants to choose from a wide range of different languages. PayPal has an average Google rating of 1.7 out of 5 stars with a total of 474 reviews.

Price Overview of PayPal Switzerland

PayPal charges neither setup fees nor monthly subscription costs, which is especially worthwhile for shops with very few transactions.

What Must Merchants Do for Integration?

To use PayPal, merchants only need to provide company information as well as a commercial register number. Developer skills are not required.

Stripe: Provider for Developers

Stripe offers developer-friendly tools for linking payment provider services to various web and mobile apps with modern design. It allows credit card payments and also provides some other payment methods such as Alipay. Like Payrexx and PayPal, Stripe is a payment facilitator. Basically, due to the prices, Stripe is especially attractive for smaller online shops. The provider has a Google rating of 4.1 out of 5 stars with 48 reviews.

Price Overview of Stripe

At Stripe, neither one-time setup fees nor fixed monthly charges are incurred. No additional fees are charged for refunds either.

What Must Merchants Do for Integration?

Merchants must possess development skills for implementation. In addition, a valid photo ID and a company number are required for verification.

Wallee: Omni-Pay Provider from Switzerland

Wallee is a Swiss payment provider based in Winterthur. Over 1,000 merchants trust this company. Payments can be integrated online either directly on the website or via redirection. Templates can be changed as desired, and plugins for various shop systems are also available. A test mode is also available. Wallee has a Google rating of 3 out of 5 stars with 39 reviews.

Price Overview of Wallee

What Must Merchants Do for Integration?

To take advantage of one of the many integrations, merchants usually need to undertake some technical steps and integrate a Wallee plugin or an API into their shop.

SaldiaPay: Payment Provider with Its Own Shop System

SaldiaPay is a Swiss payment provider offering digital payment solutions for businesses. They facilitate credit card payments, accept digital wallets, and provide secure, user-friendly payment services. Saldia offers a variety of solutions such as online payments, online shops, or logistics services, and thus build a good reputation in various industries.

Price Overview of SaldiaPay

What Must Merchants Do for Integration?

Programming skills are not necessary to use SaldiaPay. With SaldiaShop, you can easily create an online shop and have the appropriate payment provider SaldiaPay and many other integrations such as Bexio, SaldiaLogistics, and Swissbilling. The verification process includes personal identification with a photo ID and, if available, an entry in the commercial register.

Zahls.ch: New Swiss Payment Solution for the Net

Zahls.ch is a Swiss provider whose offering is very clearly designed. In addition to classic payments, e-commerce tools are also available. These include an online terminal, payment links, digital invoices, and a customizable payment page (small online shop). Zahls.ch provides all Swiss payment methods and a large selection of foreign payment methods. Zahls.ch has an average Google rating of 5 out of 5 stars with a total of 3 reviews.

Price Overview of Zahls.ch

What Must Merchants Do for Integration?

Programming skills are not necessary to use Zahls.ch, quite the opposite. You can easily create an online shop using the built-in tools. The verification process involves providing a photo ID and, if available, an entry in the commercial register.

Conclusion: Which Payment Provider Suits You?

Basically, it is advisable to clarify the individual requirements of the online shop precisely and then, if possible, start with cost-effective options instead of starting with too high expectations and paying unnecessarily much. For young and digital companies, Payrexx is an exciting option. Payrexx offers an all-in-one solution with various tools that can be tested and is the cost leader for medium-sized online shops – followed by PostFinance and Wallee. PayPal, Stripe, and Worldline, on the other hand, charge relatively high transaction fees, and Datatrans incurs high monthly fixed costs.

Apart from the prices, the range of functions and the supporting services should also be considered. Zahls.ch and Payrexx offer the most varied and useful tools.

With over 200 payment methods (including integrated external providers), Payrexx offers the largest selection of payment methods, followed by Datatrans (Planet) with over 40 different payment methods.

In terms of ease of installation, PayPal, Payrexx, and Zahls.ch stand out among other payment providers. In overall implementation, Stripe is more comprehensive than other providers. For PostFinance, extended developer skills are required for the installation of plugins.

The opportunity to test the provider and its features in a free phase is of great advantage to merchants, as it allows them to ensure that the payment provider meets their needs. Datatrans, Payrexx, PostFinance, Wallee, Worldline, SaldiaPay, and Zahls.ch allow customer testing of the provider.

Datatrans, PostFinance, and Worldline have the most experience in payment service providing.

In summary, it can be said that when choosing a payment provider, it is worth not only looking at the familiar ones but also keeping an eye on the newer digital payment providers. These are often cheaper but still offer a variety of tools and can better meet the individual needs of individual merchants. Payrexx and Wallee offer great advantages for smaller and medium-sized shops, while it may be worthwhile for larger companies to engage with the larger, more experienced providers. Generally, Payrexx clearly ranks among the leaders in terms of price, variety, and simplicity.

Sources

Prices: Datatrans, PayPal, Payrexx, PostFinance, Stripe, Wallee, Worldline 1, Worldline 2, SaldiaPay, Zahls.ch

Plugins for Shop Systems: Datatrans, PayPal, Payrexx, PostFinance, Stripe, Wallee, Worldline, SaldiaPay, Zahls.ch

Payment Methods: Datatrans, PayPal, Payrexx, PostFinance, Stripe, Wallee, Worldline, SaldiaPay, Zahls.ch

Icons: Flaticon

Legal (As of December 2023)

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Authors

Authors: Melanie Frutiger and Sven Otziger, Payrexx AG

Email Address: melanie.frutiger@payrexx.com