Online Payments: Theory for Understanding

To accept payments in an online shop, merchants need an acceptance agreement 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 the interaction with the online shop works.

What is a Payment Provider (PSP)?

A payment provider, known as a Payment Service Provider or PSP in English, refers to companies that handle the technical integration of online payment methods in online shops. An online merchant (Comerciante) only has to negotiate with a payment provider to receive all desired payment methods, integration systems, and e-commerce tools and to meet the security requirements. The corresponding contract with the payment provider is called a processing contract because it relates to the technical handling and processing of payments.

Functionality of a Payment Provider (PSP)

What is an Acquirer and an Acceptance Agreement?

An acquiring or acceptance agreement is an agreement between a commerciali and an acquirer (also referred to as an acquiring bank). This contract regulates the acceptance and processing of credit card payments and other electronic payments. The acquiring bank is the financial institution that handles card payments for merchants. An acceptance agreement can be concluded by merchants with acquirers such as Worldline or Concardis, or 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 agreement on behalf of the acquirer and simplifies the setup since the merchant has fewer direct relationships. The Payment Facilitator thus enables the integration of various payment methods in the online shop with just one contract.

Functionality of a Payment Facilitator (PF)

How do you choose the right provider?

For merchants, it is crucial to have easy and reliable integration, a wide range of payment methods and tools, good support, and a payment provider that saves as much cost as possible to avoid unnecessary expenses. Furthermore, every online shop should clarify the following prerequisites:

• Which payment methods should be offered in the online shop? Not every provider supports all common payment methods. Depending on the region or the origin of the provider, different payment methods are available.

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

• Which shop system do you use? Most providers offer plugins to the most known shop solutions* for integrating 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. Through a contract with a PSP, you also meet these standards and can guarantee the highest payment security to your customers.

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

Overview of the functions of the 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.

*These are the most common methods in Switzerland.

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

Datatrans has been merged with Planet, Hoist, protel, and Proximis under the joint brand planet. In this article, we speak about Datatrans (planet).

Function Matrix of the various Payment Providers

**Datatrans has been merged with Planet, Hoist, protel, and Proximis under the joint brand planet. In this article, we speak therefore of "Datatrans (planet)" and refer to Datatrans’ public terms.

Cost Analysis

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

For the cost analysis, the lowest offers of the individual payment providers for the corresponding sales volume were each selected. The pricing information is mostly* taken from the websites of the respective Payment Service Providers. Any setup costs are not included in the diagram.

*The offer from Datatrans does not publicly show acquiring costs. Therefore, a value of 2% was assumed (average value of all other providers).

Online Shops with monthly sales of EUR 20,000

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

Monthly costs at sales of EUR 20,000 (without setup)

The lowest fees for 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 the most expensive offer. Additionally, Payrexx offers exclusive discounts of 30% for startups and 50% for non-profit organizations on all pricing plans.

Online Shops with monthly sales of EUR 100,000

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

Monthly costs at sales of EUR 100,000 (without setup)

Payrexx is the cheapest provider at EUR 1,549 per month, followed by wallee. Significantly more expensive for medium-sized online shops than the other providers are PayPal, Stripe, and Worldline. Payrexx is overall EUR 2,401 cheaper than the most expensive provider, resulting in a percentage price difference of over 60%.

No calculation was made for large online shops since most payment providers each offer non-public special conditions for larger customers – e.g., Datatrans, Payrexx, Stripe, walle, 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 favorable pricing model and a variety of payment interfaces and e-commerce tools, Payrexx represents a modern and user-friendly all-in-one solution.

With the integrated tools such as payment link, 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, as well as for collecting membership fees or processing donation projects. Thanks to the 30-day trial period, the payment platform can be tested free of charge. Payrexx has an average Google rating of 4.1 out of 5 stars with a total of 126 reviews.

Price Overview of Payrexx

* Special conditions between 1.5% and 1.3%

What do merchants need to do for integration?

Since every merchant receives a payment website with its own Internet address, neither integration nor programming skills are 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 an entry in the commercial register.

PostFinance Checkout: A Comprehensive E-Payment Solution

PostFinance enjoys great customer acceptance in Switzerland. PostFinance Checkout is a payment solution that offers all common means of payment (PostFinance E-Finance, PostFinance Card, TWINT, as well as Visa and Mastercard) and various shop plugins. The prices listed below already include all payment provider and acquiring costs. PostFinance also offers a free trial period for 30 days 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 do merchants need to do for integration?

PostFinance Checkout is available to all companies based 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 presents its offerings mostly in packages. With the Worldline E-Commerce package, payments can be processed directly through a payment window. Transfers are possible in more than 20 currencies, and customers can decide in which currency they wish to pay. This is also because Worldline offers so-called Dynamic Currency Conversion. In addition, Worldline offers various payment functions, such as recharge or booking partial amounts. Worldline has an average Google rating of 2.8 out of 5 stars with a total of 420 reviews.

Price Overview of Worldline

What do merchants need to do for integration?

No programming knowledge is required. According to its own statements, Worldline is particularly suitable for existing e-commerce solutions and static websites.

Datatrans: Provider with Much Experience

Datatrans is the largest provider in Switzerland and can be integrated either as an external payment option (external payment window) or 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 assimilate seamlessly into the design and help to improve the merchant's conversion rate. This provider also offers the option of creating a test account. 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 listed on the Datatrans 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 incurred in addition to the costs of Datatrans.

What do merchants need to do for integration?

Datatrans itself does not have an online shop tool, so you must already have your own online shop. This can be a self-developed shop, or you use a standard shop system. Since Datatrans is neither an acquirer nor a Payment Facilitator, merchants require additional acceptance agreements with another acquirer.

PayPal: An International Payment Provider

PayPal is a simple solution for shop operators but becomes quickly expensive with larger order volumes. Payment links, email invoices, and various plugins are available. According to its own statements, the Payment Facilitator PayPal has more than 240 million active users and offers the ability to conduct payments in over 100 currencies. PayPal is an international provider, allowing comerciantes to choose from a 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 does not charge setup fees nor monthly subscription costs, which is especially worthwhile for shops with very few transactions.

What do merchants need to do for integration?

To use PayPal, merchants only need to provide business information and possibly a commercial register number. No developer skills are required.

Stripe: Provider for Developers

Stripe offers developer-friendly tools for connecting payment provider services to various web and mobile apps with a modern design. It allows credit card payments and also provides some other payment methods like Alipay. Stripe is, like Payrexx and PayPal, a Payment Facilitator. Basically, Stripe is attractive for smaller online shops due to its pricing. The provider has a Google rating of 4.1 out of 5 stars with 48 reviews.

Price Overview of Stripe

With Stripe, no one-time setup costs or fixed monthly fees are charged. No additional fees are charged for refunds either.

What do merchants need to do for integration?

Merchants need developer skills for the 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. More than 1,000 customers trust this company. Payments can be integrated online either on the website or conducted via redirection. The 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 do merchants need to do for integration?

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

saldiaPay: Payment Provider with its Own Shop System

SaldiaPay is a Swiss payment provider that offers digital payment solutions for businesses. They enable the processing of 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 earns a good reputation in various industries.

Price Overview of saldiaPay

What do merchants need to do for integration?

No programming skills are necessary to use saldiaPay. With saldiaShop, you can easily create an online shop and have the matching payment provider saldiaPay, along with many other integrations like bexio, saldiaLogistics, and swissbilling. The verification process includes personal identification with a photo ID and, if available, entry in the commercial register.

zahls.ch: New Swiss Online Payment Solution

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

Price Overview of zahls.ch

What do merchants need to do for integration?

No programming skills are necessary to use zahls.ch, on the contrary. You can easily create an online shop using the built-in tool. The verification process includes providing a photo ID and, if available, entry in the commercial register.

Conclusion: Which Payment Provider is Right for You?

Overall, it is advisable to clarify the individual requirements of the online shop carefully and then, if possible, start with cost-effective options rather than starting with too high expectations and paying unnecessarily high fees. For young and digital companies, Payrexx is an interesting option, for example. Payrexx offers an all-in-one solution with various tools that can be tested and is a price leader among medium-sized online shops – followed by PostFinance and wallee. PayPal, Stripe, and Worldline, on the other hand, charge relatively high transaction fees, and Datatrans incur high monthly fixed costs.

In addition to prices, the range of features and supporting services should also be considered. Zahls.ch and Payrexx offer the most diverse and useful tools.

With over 200 payment methods (including integrated third-party providers), Payrexx offers the largest range of payment methods, followed by Datatrans (planet) with over 40 different payment methods.

In terms of ease of installation, PayPal, Payrexx, and zahls.ch outshine the other payment providers. In general implementation, Stripe is more comprehensive than the other providers. At PostFinance, advanced developer knowledge is required for plugin installation.

The ability to test the provider and its functions in a free phase is of great benefit to merchants, as this allows you to ensure that the payment provider meets your needs. Datatrans, Payrexx, PostFinance, wallee, Worldline, saldiaPay, and zahls.ch allow customers to try out the provider.

Reputable experience in the field of Payment Service Providing is held by Datatrans, PostFinance, and Worldline.

In summary, it can be concluded that when choosing a payment provider, it is worth looking at not only the well-known ones but also the newer digital payment providers. Because these are often cheaper but still offer a variety of tools and can better cater to the individual needs of individual merchants. For smaller and medium-sized shops, Payrexx and wallee offer great advantages, while it can be worthwhile for larger companies to engage with the larger, more experienced providers. Essentially, Payrexx is clearly a leader in 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 Information (as of December 2023)

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Authors

Authors: Melanie Frutiger and Sven Otziger, Payrexx AG

Email Address: melanie.frutiger@payrexx.com