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Taking money online

Taking money online

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The value of online transactions in the UK has virtually double in just 4 years, since 2012.  So, what’s the best way for small businesses such as yours, to take payments for sales you make online?

If your business already has a merchant account, then you’ll have plenty of choices and advice from your bank or merchant provider; but if you’re a small business who doesn’t have a need for a merchant account or perhaps you don’t have the track record required to get one, then you might be wondering how on earth you can take payments via your website easily and relatively cheaply.

The aim of this post is to cover the basics, keep it simple and hassle free.

Really, there’s 3 choices for small businesses to take payments via their website:-

  • Paypal
  • Debit / Credit Card Processor (such as Stripe)
  • Both

Both solutions have transaction fees applied, but so do any banking transactions and the fees for both Paypal and Stripe are pretty reasonable.


Far and away, the easiest way to take payments online is to use Paypal.  Setting up an account is easy and virtually no technical expertise is required to create Paypal ‘Buy Now’ buttons to add to your website.


Over 20 million UK shoppers have Paypal accounts, so they are happy to use Paypal to make payments if the option is there.  21% of all UK online transactions are made using Paypal and and many are in the small business sector. It’s easy to set your business up to take Paypal payments, it’s safe & secure for buyers and has a great reputation.

When people pay you via Paypal, the funds first go in to your Paypal account and you can transfer the funds to your bank account within a few days.

There is a choice of Personal or Business accounts an I recommend that that you set up a business account from the outset.  Simply go to www.paypal.co.uk and click on the SignUp button; there you’ll be asked whether you’re signing up for a personal or business account, select business and fill out the 3 step signup form.

paypal bus ac setup

The sign up process requires that you fill out basic contact details, some information about your business activities, plus your business bank details.  By linking your Paypal account to your bank, you’ll be able to transfer funds to your bank account as soon as they have cleared.

Depending on your business type, your track record and the likelihood of refund requests in your industry sector, Paypal may hold a percentage of your funds in your Paypal account for bit longer, but that’s standard practice and something that will most likely be removed once you have a proven track record.  It’s a small price to pay for the convenience of taking payments online without the hassles of setting up a full blown merchant account.

Buyers don’t even need to have a Paypal account to pay you with their debit or credit card.  There is an option for people without accounts to pay directly without signing up to Paypal, which is great news.

However, whilst buyers don’t have to have a Paypal account to buy from you using your Paypal button or cart, it is true that people who don’t have Paypal may not realise that.  Those customers may prefer traditional debit / credit card payment options.  Now that’s not a reason to ignore Paypal though, there are many people who prefer to use Paypal because they’re happier in the knowledge that they don’t have to divulge their personal credit card details to businesses that they may not know or fully trust.


Stripe is a way of adding straightforward, secure debit and credit card processing.  You can add:

  • a complete order form to your website that you design yourself, and include the Visa and Mastercard icons to your page to indicate that you can take card payments, or
  • have a simple Pay Now button, which when clicked, brings up a simple pop-up window, or
  • link Stripe to a shopping cart


 The payment forms look very slick and add a good impression (see pop-up example below).

stripe demo widgets

Stripe isn’t quite so easy for the novice to set up as Paypal, but that said, it’s just a technical integration that needs to be sorted, rather than the need to jump through approval hoops.  When I first used Stripe, I got someone to set it up for me, I think they charged me about £90 and it was money well spent as it saved me lots of time.  Either your web designer will be able to add it to your website or you can hire an independent web developer, like I did.

 Offering Both Paypal and Stripe

If you can do both then go ahead.  The real key to taking payments online is presenting as few barriers as possible to your potential buyers.

Some potential customers will prefer Paypal and some will prefer an option to enter their card details directly on your webpage.  When it comes to online payments many people will not buy if they are unsure about the payment options they’re presented with, so having both options is definitely a good plan if you can do it.  You can always start with one and add a second option later.


The most important thing is to get something set up as soon as possible so that you can start selling online.

If your market has a preference for Paypal (and some do), then go with that.

If you think your market has a preference for direct entry card payments, then Stripe is far and away the best way to get that set up.  However, as it’s a bit more technical to get Stripe installed, then either ensure that you have someone on hand to help or go for Paypal first and then add Stripe once you have the time to get it sorted.



A word of caution:  it’s worth mentioning that if your sales are likely to exceed around £6,000 per month, you should look quickly in to getting your own merchant account.  The reason for that, is that payment aggregators such as Paypal and Stripe, have their accounts closely monitored by Visa and Mastercard, who will literally force them to make sure that high value ($100,000 per year) customers swap to traditional merchant accounts.  They’ll do this by getting aggregators to close those risky accounts or hold funds for up to 90 days. That may sound draconian, but it’s all about managing their risk and, lets face it, there are some dodgy traders out there who spoil things for the rest of us.




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