A Few Good Online Payment Multitaskers
Tools for processing a variety of transactions on your Web site
This article is courtesy of Idealware, which provides candid information to help nonprofits choose effective software. For more articles and reviews, go to www.idealware.org.
If you're looking to accept donations, register people for events, or sell items online, there are many applications out there to help you complete any one of these transactions. But what if you're looking to process more than one type of payment? What if your needs are a little out of the ordinary? Are there any software options that will support a variety of online transactions?
Idealware put this question to a number of online payment experts who have worked with nonprofits. Below, you'll find a summary of their advice, along with a list of their top go-to tools for processing various types of payments on an existing Web site.
Jack of All Trades, Master of None
When selecting an online payment application, it's important to keep in mind that software specializing in one payment type often comes with comprehensive tools tailored to support that particular function. For instance, a robust online donation tool might include support for pledges, tributes, or matching gifts, while a robust e-commerce package might automatically calculate shipping fees or provide shopping-cart functionality.
Multitaskers, on the other hand, are unlikely to provide comprehensive support for many types of transactions. Some focus on just one particular payment type, while others offer a number of payment types, but lack deep functionality for any one feature. And while putting together your own payment solution — which we describe below — gives you complete control over all of your payment processes, doing so requires you to build all the functionality yourself (or purchase additional software) to handle anything beyond the most basic features.
Therefore, if you only want to process a single, common type of transaction on your site — such as registering people for events — you'll be better off with one best-of-breed application tailored to your specific needs. Even if you require specialization in two or three payment areas, don't rule out the possibility of using and integrating several different tools — a sophisticated e-commerce solution working in concert with high-end registration software, for example, will likely meet your advanced needs better than any single application attempting to meet both needs at once.
But if you have multiple, straightforward needs that require less specialization — for instance, you'd just like to take basic online donations, sign up members, and sell a few items — you have a number of options.
Hosted Online Payment Specialists
If you're looking for software to support several typical kinds of payments without a lot of complicated setup, it makes sense to use an online service that offers payment forms hosted on the vendor's server. Hosted online payment tools allow you to link out from your Web site to one or many forms that can process an unlimited number of payments. The forms can often be customized to match your Web site (at least to some degree), thus creating a relatively smooth transition from your site to the vendor's. Because you don't have to create and host the payment form yourself, you don't need to worry about security issues, and you generally don't need to know any code to set them up.
Some hosted online payment tools require you to set up your own merchant account, a bank account that can receive online payments. While you can get started faster with a vendor like PayPal or Click & Pledge, which allow you to use their own merchant accounts, setting up your own account gives you more flexibility and allows you to receive money more quickly. Whatever payment option you choose, study its fee structure carefully, and calculate what you would pay based on the number and size of payments you expect to process. Fee schedules are often very detailed, and small differences in transaction fees can add up over time.
Note that the donation functionality included in most of these tools is reviewed in greater detail in Idealware's Online Donation Report.
- Paypal Standard offers an inexpensive and relatively flexible way to take payments. While less out-of-the-box than the other options in this section — you'll need someone with HTML skills to set it up for you — it offers a lot of payment options, including support for donations, recurring payments, and a shopping cart. You can't integrate PayPal Standard seamlessly with your Web site, so visitors will know that they're leaving your site to go to PayPal. However, PayPal Standard is used by thousands of people for robust payment processing, and is one of the least expensive ways to take payments online, with a single charge of about 3 percent per transaction.
- Click and Pledge
- Click & Pledge is a budget-friendly option for those who want to integrate payment forms into a Web site, but don't expect to process a ton of payments. The site levies a simple transaction fee of 4.75 percent of each payment, without other monthly charges: an attractive price if you're taking less than 10 or so payments a month, but not as competitive for higher volumes. Some color and graphics customization options allow you to tailor the payment forms to approximately match your site. Click & Pledge is built on a shopping-cart model (meaning you view all payments in a "cart" screen), which handles item sales, event registrations, and membership payments well, but can feel a bit odd for donations.
- Auctionpay is a good option for organizations looking for a middle-of-the-road donation, registration, and event solution at a reasonable price — it's $30 a month with a 3.5 percent per-payment transaction fee. ActionPay's donation form can be integrated into the look and feel of a Web site to some degree, and is quite customizable.
- A solid, high-end option, GiftTool offers robust support for donations, an online shopping cart, event registration, pledge-a-thons, and more. It can be completely integrated into the look and feel of your site. When you use more than one of its payment functionalities, GiftTool's monthly fees are higher than most of the tools listed above. However, the company charges a flat $1.23 per transaction rather than a percentage of the payment, making the pricing attractive for those accepting large payments such as conference registration fees.
- MemberClicks is an integrated database, payments, membership, and email solution with an interesting form-building feature that allows organizations to create and update their own complex payment forms for online registration, dues, memberships, donations, or products; it even supports some basic custom workflow and business rules. While you'll need to set up your own merchant account (which has its own affiliated fees) to use MemberClicks, the service itself only charges 1 percent of the payment, plus a flat 40 cents per transaction, with a $25 monthly minimum fee.
- Half hosted payment-processing tool and half Web-development shop with a focus on payment processing, CharityWeb offers payment solutions custom built to meet your particular needs for donation, membership registration, events, products, and more. Because it comes with high setup fees and requires a merchant account, CharityWeb is not for organizations that are just getting started with online payments, but it could be a great choice for those ready to invest in a custom solution.
Hosted Online Integrated Solutions
If you plan to revamp your entire Web site, and are open to a new constituent database, a hosted online integrated tool is worth considering. Such tools offer support for payments as well as content management, email blasting, and more — all centered around an integrated constituent database.
If you're looking for a generalist integrated tool, consider Kintera, which offers strong support for event registration and marathon-style events, or Convio, which offers strong support for donations. Convio's very recent merger with GetActive (another online integrated tool) should boost its functionality in the advocacy area as well. Pricing for both Kintera and Convio starts in the several hundred dollar per month realm, and can go much higher, with additional transaction fees per payment.
Membership-based organizations should also take a look at integrated tools with a membership focus, including the aforementioned MemberClicks, YourMembership, GoMembers, NetForum by Avectra, and Aptify.
Rolling Your Own Payment Solution
The hosted online payment specialists or online integrated tools listed above can be a practical way to integrate payment processing into your Web site. However, if you need to create custom workflows or business rules, or if you would like to integrate data directly with your database, hosted solutions are likely to feel limiting.
In this case, you may wish to "roll your own" payment system, by coding your own payment forms and business rules, and then connecting them to a back-end payment processor. These processors, referred to as "payment gateways," take care of the mechanics of validating and processing the credit cards.
This route will require some technical chops (the ability to integrate HTML forms with calls to Web services or APIs, for instance) and a bit of a learning curve to master the rules of the specific payment gateway. However, someone with experience in payment processing can likely set up a basic payment form in less than a day.
Keep in mind, though, that you're likely to need a lot more than just a basic payment form. Should you decide to create your own payment solution, you'll be entirely on your own when it comes to creating or maintaining site functionality. Want to accept pledges? You'll need to design and build that feature yourself. Want to be able to cap the number of attendees for event? You'll need to design and build that, too. Want a shopping cart? You'll likely need to use a different tool for that. When you factor in the need for additional functionality and business rules, you're likely to need weeks or even months to design, program, and test your system.
You'll also need to purchase services beyond the payment processor itself. You'll need to set up a Secure Sockets Layer (SSL) certificate for your Web site payment forms to protect the credit-card information. SSL is the protocol that makes it much harder for people to intercept information from your server, and provides a Web address which starts with the secure standard HTTPS. Depending on which payment gateway you choose, you may also need to get your own merchant account as well.
As with the hosted tools, study the payment processor's fee schedules carefully, looking out for extra costs for things like electronic funds transfer (EFT, or e-checks) — which allow visitors to pay by check online by entering check-routing numbers — or recurring payments. The list of fees tends to be complicated, and can only be compared by estimating your expected volume and using that to calculate costs.
- Secure email
If you're looking for a low-impact way to take a few payments online, and are already taking offline credit-card payments, you might consider coding a payment form on your Web site to send the details of the purchase, along with credit-card information, via secure email. Your organization could then run the card through in the same way you would a credit-card number received by the phone.
While it's technically straightforward for an experienced programmer to set up, be careful with this method. Make sure you process credit cards promptly, and delete emails with credit-card information afterwards so that hackers can't access them. As the real-time processing methods below are not that much more complicated to set up, consider whether this offline route really saves you enough effort to be worth the additional hassle and security implications.
- PayPal Pro
- In addition to the more familiar PayPal Standard, PayPal Pro allows you to hook up with the PayPal processing engine without using their front-end forms. You create the payment forms on your own Web site, and then use an application programming interface (API) to automatically send the credit-card and payment information to PayPal. PayPal accepts the requests, processes the credit card in real time, and sends back a success or failure message. No additional merchant account is required for this service, and the only charges are PayPal's typical transaction charge of about 3 percent of each payment.
- IATS is a service provided exclusively to nonprofit organizations by TicketMaster. Like PayPal Pro (though predating it by several years), IATS provides both a merchant account and a payment gateway service that you can hook up to payment forms on your Web site via API. Transaction fees are also similar to PayPal, with a simple percentage structure depending on volume (the standard fee is 2.9 percent). At press time, IATS did not offer EFT processing, but it hopes to roll out that service in 2007.
- Vanco is another combined merchant account and payment gateway — in the same vein as PayPal Pro and IATS — that also primarily serves nonprofits. Vanco offers particular flexibility to programmers through its API for recurring gifts, and is especially affordable for EFT transactions. Its percentage-based transaction fees for credit-card payments may be a little higher depending on your transaction volume, but it's a strong option if you want integrated credit-card and EFT transactions.
- Paypal Payflow and Authorize.Net
Paypal Payflow (formerly Verisign) and Authorize.Net are two companies that directly compete with each other to provide similar services. Paypal Payflow and Authorize.net are the classic way to build a payment-processing service and are widely used by many major Web sites. Like the options above, these services allow you to submit payment requests from your Web site through an API and get back a confirmation or denial message. For Payflow and Authorize.Net, though, you'll need a separate merchant account — which allows more flexibility but requires additional setup.
Both Paypal Payflow and Authorize.Net offer many plans catered to different levels of activity. They are not necessarily more expensive than the other options listed here if you primarily process credit-card (as opposed to EFT) payments, especially if you are taking in dozens or hundreds of payments a month. However, Paypal Payflow and Authorize.Net's fee structures are complex, and you should make sure you read their fine print carefully. On the other hand, their EFT services tend to be comparatively expensive and not completely integrated with the credit-card services — meaning your programmer might need to learn two systems in order to process both credit-card and EFT payments.
Wrapping It Up
Accepting online payments from your Web site requires a bit of setup and a vendor to help process transactions, but it shouldn't be prohibitive for any organization. From straightforward tools like PayPal or Click & Pledge to robust solutions like CharityWeb, online integrated tools, or Authorize.Net, there are good options for any requirements. Choose a vendor with an eye to your specific needs and the actual transaction volume and amounts you expect to take in, and you'll be set up for successful — and lucrative — payment processing.