7 Best Payment Gateways for Dropshipping in Australia

In today's digital world, customer experience has become a top priority for any business to thrive in competitive marketplaces. This is especially true with online shopping getting more and more popular. Customer experience is about how easy and enjoyable it is to buy things online. For businesses, this means ensuring their websites offer seamless navigation, the purchasing process is effortless, the payment process is hassle-free, and customer service is top-notch. 

However, the most critical aspect of the customer journey is the payment process. Ensuring that the payment process is easy for your customers is crucial for providing a smooth and satisfying purchasing experience from start to finish. Payment gateways play a critical role in achieving this by securely processing transactions and offering various payment options, thereby contributing to a frictionless payment experience for customers. 

In this blog, we’ll explore the crucial role payment gateways play in dropshipping, examine the key factors to consider when selecting payment gateways for your ecommerce platform and highlight the top payment gateways for dropshipping businesses. Let’s get started.       

What are the best payment gateways for dropshipping and ecommerce stores?

The surge in ecommerce and online transactions has amplified the need for secure payment processing, leading to the development of payment gateways and online payment processors. Payment gateways serve as the virtual bridge connecting an ecommerce platform and a bank for processing customer payments. They are an integral part of processing online and in-store payments and are responsible for authenticating and securely transmitting payment data between different parties involved in the payment process.

How payment gateways work in ecommerce

While from a customer’s perspective, they're just completing a few steps in the payment process, there’s actually a lot more happening behind the scenes than they realise. Let’s take a look at each stage of the payment process, from initiation to settlement.

Initiation

After a customer selects items for purchase and proceeds to checkout, they enter their credit card details on a payment page. The payment page is either hosted by a payment gateway in its entirety or the entry fields are encrypted and credit card details are securely passed onto the payment gateway. If the entry fields are encrypted, the ecommerce platform encrypts the credit card details using SSL protocols before transmitting this sensitive data to the payment gateway. 

Verification

After receiving the payment details, the payment gateway verifies the authenticity of the transaction by performing several checks. It validates the payment details provided by the customer, ensures the cardholder has adequate funds for the purchase, and confirms the validity of the bank account. In response to the increase in fraudulent transactions, the payment gateway also implements security measures such as fraud detection to prevent unauthorised transactions and protect customer data.

Settlement

Once the transaction is verified and approved, the payment gateway facilitates the transfer of funds from the customer’s bank account (issuing bank) to the retailer’s business bank account (acquiring bank). A confirmation is sent to both the customer and the retailer after the funds are successfully transferred to indicate that the transaction has been completed.  

This entire process happens in a matter of seconds, providing a seamless and secure payment experience for all parties involved.

Benefits of payment gateways for your ecommerce business 

Let’s now delve into the significance of a payment gateway in ecommerce and explore its potential benefits in today’s ecommerce financial landscape.

Efficient transaction processing

Payment gateways play a pivotal role in ecommerce by seamlessly processing transactions. When a customer enters their payment details, payment gateways ensure that funds are efficiently transferred from the customer’s bank account to the merchant’s bank account after verification, enabling businesses to complete sales transactions quickly and reliably. 

Secure payment experience

With the increasing importance of data security in online transactions, payment gateways handle payment information securely by encrypting sensitive data and transmitting it to the acquirer’s bank for verification and settlement. This provides customers with peace of mind while safeguarding their personal and financial information from unauthorised access and malicious activities. 

Seamless checkout process

Customers expect a fast and hassle-free checkout process. A payment gateway caters to these expectations by allowing customers to conveniently make payments anytime, anywhere, and from any device without having to visit other websites or go through laborious procedures, offering them a positive payment experience. This also helps in reducing customer cart abandonment rates and increasing conversion rates.  

Improved security and fraud prevention

As the digital economy is rapidly evolving, businesses of all sizes need to re-evaluate their position when it comes to fraud management. Payment gateways offer ecommerce businesses security against fraudsters with their fraud detection capabilities. They implement various security measures that help to tackle fraud and minimise losses due to it. 

Global reach and accessibility

Many payment gateways support multiple currencies and have the option to integrate with local and global payment methods such as Apple Pay and Google Pay, allowing businesses to expand globally. Businesses should consider offering a range of payment choices, including credit cards, debit cards, and digital wallets, letting their customers choose how they pay. This convenience allows customers to make online purchases in a hassle-free way without leaving the retailer’s site.     

Efficient transaction tracking and reporting

Payment gateways provide businesses with comprehensive reporting tools and analytics dashboards to monitor and analyse transaction data. This enables them to track sales performance, analyse customer behaviour, and make data-driven decisions to optimise their payment strategies.

7 best payment gateways in Australia 

If you are wondering which payment gateways are best for dropshipping in Australia, we’ve got you covered. Let’s look at some of the best payment gateway options available. 

Shopify Payments

Shopify Payments, a product of Shopify, is the default payment processor for Shopify stores. It’s the simplest way to accept payments online, eliminating the hassle of setting up a third-party payment provider or merchant account and having to enter the credentials into Shopify. Using Shopify Payments for your Shopify store is an easy solution as the payment processor automatically integrates with your store data and analytics. Additionally, customers can checkout easily without being redirected to third-party sites. 

With Shopify Payments, you’re automatically set up to accept all major credit cards and other payment methods when you create your Shopify store, including international credit cards. When you’re using Shopify Payments, the currency your customers use to pay for their orders can be different from the currency of your payouts, meaning your store currency can be different from the currency of your bank account. Furthermore, a currency exchange rate and a conversion fee are applied when a patent is captured. If the currency needs to be converted for a refund, then the current currency exchange rate, and not the currency exchange rate at the time of the order, is used in the conversion. Conversion fees are not applied for refunds that require currency conversion.  

Pricing

Shopify Payments integrates directly with your checkout. If your business is eligible for Shopify Payments, you only pay the credit card rate without an additional third-party transaction fee. You can set up Shopify Payments right from your Shopify admin instead of having to log in to another website or account. Additionally, you can view your payouts in real-time, right from your Shopify admin.  

Payment method

Shopify Payments supports all major credit cards and payment methods:

• Credit card and debit card 

• Apple Pay

• Google pay

• Shop Pay

Pros of Shopify Payments 

The pros of Shopify Payments are as follows:

• Easy integration with the Shopify platform 

• Automatically set up with Shopify stores

• Competitive transaction rates 

• Ability to sell in different currencies 

• Unified dashboard for managing orders and payments 

• Convenient for both retailers and customers 

Cons of Shopify Payments

The cons of Shopify Payments are as follows:

• Only operates in certain countries and regions

• Need to activate two-step authentication to prevent criminal attacks

• Transaction fees vary based on Shopify plans. 

PayPal

PayPal, a widely popular payment gateway, offers various payment solutions for processing payments online. It’s one of the most used payment gateways and is often considered the ‘go-to’ payment solution. PayPal offers a broad range of services to cater to the diverse needs of businesses, including payment processing, invoicing tools, mobile payment solutions, and even business loans. However, its primary offering is to enable businesses to receive payments in a quick, convenient, and secure manner. Whether you’re a small or medium-sized business, PayPal can help you accept payments and reach customers in more than 200 markets around the world.   

PayPal also accepts subscription and recurring payments and offers other payment options such as Pay in 4 and Buy Now Pay Later with a zero interest fee. Additionally, PayPal offers both buyer and seller protection for your peace of mind. It’s easy to connect your ecommerce store to your PayPal business account and is available on all major ecommerce platforms such as Shopify, BigCommerce, WooCommerce, Adobe, Opencart, and Maropost.  

Pricing

The fees PayPal charges vary greatly depending on the nature of the transaction. For Australian retailers, PayPal charges a fixed fee plus a percentage of the transaction amount. Check out the PayPal fee structure here.  

Payment methods

PayPal supports the following payment methods:

• PayPal Wallet

• Credit card and debit card

• Bank transfers

• PayPal Credit

Pros of PayPal

The pros of PayPal are as follows:

• Effortless integration

• Global reach

• Supports multiple currencies

• Buyer and seller protection programs

• High level of consumer trust 

Cons of PayPal

The cons of PayPal are as follows:

• Currency-based fixed fees may complicate profit estimation

• Occasional account holds or disputes

Square

Designed to save you time and money, Square simplifies your payment operation. It’s flexible, secure, and reliable - so you can focus on your business, not on your payments. It supports multiple platforms, such as Shopify, WooCommerce, and GoDaddy, and provides solutions for every way you want to sell. You can take payments on your website or in your mobile app or take payments with existing online store providers. 

Square is PCI-compliant and offers protection to both sellers and customers against fraud and malicious activities. It also provides AML and KYC checks in the system at no extra cost. Additionally, your customer’s payment data is secure with end-to-end encryption. There are also incident response plans in place to monitor and respond to malicious actors.

Furthermore, businesses can make informed decisions with a complete view of their business with Square’s Customers API, Catalogue API, and Inventory API. It allows businesses to transfer transaction data into a CRM, OMS, ERP, or any other enterprise business solution.  

Pricing

Square doesn't charge a flat monthly fee or annual fee. It offers standard rates for businesses that process less than $250k per year. For larger businesses, the pricing packages are designed depending on payment volume, average transaction size, your history as a Square seller and more. You’ll need to contact the sales team to get quotes for your business. 

Payment methods 

Square supports the following payment methods:

• Credit card and debit card

• Apple Pay

• Google Pay

• Square gift cards

Pros of Square

The pros of Square are as follows:

• User-friendly interface

• Easy to set-up

• Transparent pricing

• Offers end-to-end encryption for transactions

• Competent reporting tools

• PCI compliance and fraud protection

Cons of Square

The cons of Square are as follows:

• Limited international availability

• May not be suitable for high-volume businesses

eWay

One of the leading payment gateways, eWay provides secure and customisable payment solutions for online businesses of all sizes and types. It’s trusted by more than 97,000 online business owners, including REA Group, TerryWhite Chemmart, and LG. With eWay, you can start taking payments for your online business quickly and conveniently. It offers out-of-the-box payment solutions to suit almost every business. Additionally, you can increase your business productivity, improve financial management, and achieve critical marketing gains with their feature-packed tools. 

Accepting payments can be complicated, so eWay’s dedicated local team of experts is here to help you every step of the way. It provides 24-hour emergency technical support for your peace of mind. Using the highest measures of security with PCI DSS level 1 card data protection and fraud protection tools, eWay screens incoming transactions to protect your customer and business data. 

Pricing

Whether you’re a start-up, well-established or an enterprise company, eWay offers a payment solution to meet your business needs. They provide you with three pricing plans: Online payments, Gateway services, and Enterprise solutions. eWay offers flat rates, and the pricing structure is simple, clear and comes with no hidden surprises. In case of disputes, they ensure fast settlement. 

Payment methods

eWay supports the following patent methods:

• Credit and debit cards

• Digital wallets - Click to Pay, Apple Pay, and Google Pay

• Digital bank transfers

• Token payments

• Mobile payments 

• Phone payments - SequenceShift

Pros of eWay

The pros of eWay are as follows:

• Accepts multi-currency both online and manual payments

• Secure and reliable 

• Accepts recurring and subscription payments 

• Fast transactions

• Built-in fraud protection

• Local support

• Customisable payment pages 

Cons of eWay

The cons of eWay are as follows:

• Limited global reach

• May have high transaction fees for some businesses

Authorize.Net

Authorize.Net, a US-based payment gateway, makes accepting payments online easy. It enables seamless payment processing for businesses, whether it’s through your website, mobile app, or manual transactions. Authorize.Net integrates with various ecommerce platforms, including WooCommerce, Magento, 3dcart, Custom Cart, Shopify, and BigCommerce. It also supports a variety of payment methods that customers prefer, so your customers can choose what they’re comfortable paying with. Payment processing is simplified, so the customer experience is seamless whether they choose to pay online or in person. 

Authorize.Net payment gateway also processes international transactions anywhere in the world as long as your business is based in the United States, Canada, or Australia. With its Advanced Fraud Detection Suite, your business data and customers’ bank account details are safe. Its fraud detection software lets you customise with rules-based filters and tools to suit your business model. It has 13 easily configurable fraud filters to help set proper minimum transaction thresholds, payment velocity settings, country limitations, and more to help prevent processing fraudulent transactions. Authorize.Net is a secure and reliable way to process online payments, and it offers several features that make it an ideal choice for businesses of all sizes.

Pricing

Authorize.Net offers three pricing plans: All-in-one, Payment gateway and eCheck, and Payment gateway. The processing rates per transaction vary based on the plans. It also provides additional services that are included in all plans such as Advanced Fraud Detection Suite (AFDS), invoicing, Customer Information Manager (CIM), Recurring payments, and Simple checkout. Account Updater and eCheck offer more flexibility and payment processing options but with additional costs.  

Payment methods

Authorize.Net supports the following payment methods:

• Credit and debit cards 

• PayPal 

• Apple Pay 

Pros of Authorize.Net

The pros of Authorize.Net are as follows:

• Comprehensive fraud protection features 

• Supports multiple payment options to accommodate diverse customer preferences

• Digital invoicing 

• Integrates with multiple ecommerce platforms 

• Extensive developer resources available 

Cons of Authorize.Net

The cons of Authorize.Net are as follows:

• Potential learning curve for new users

• Requires technical expertise to set up

• Occasional technical glitches affecting transactions

• Transaction fees can be higher compared to other gateways. 

SecurePay

SecurePay, a product of Australia Post, offers secure and flexible payment solutions to over 90,000 Australian businesses. It’s easy to set up and integrate with your ecommerce store. SecurePay enables you to process online everyday payments and manage recurring billing payments. It has a dedicated dashboard to help you manage your payments, and you can view detailed transaction reports from your dashboard, giving you a complete view of your transaction history. 

SecurePay is fully PCI DSS compliant and lives up to the current global standards of online security, keeping you and your customer’s personal and financial details safe. It supports your growing business by providing multiple payment options. Furthermore, SecurePay’s Dynamic Currency Conversion solution enables businesses to accept international transactions, allowing customers to pay in their own currency with a transparent exchange rate that is locked in at the time of their transaction. 

SecurePay has partnered with the National Australian Bank (NAB) to offer a comprehensive service package comprising a payment gateway and a merchant account, ensuring you have everything you need for online payment processing. However, if you already have a merchant account, you can check out their Payment Gateway-only solution.   

Pricing

SecurePay offers two plans: Standard and gateway-only plans. SecurePay uses a straightforward and affordable per-transaction pricing model for the standard plan. The gateway-only plan allows you to choose from flexible pricing plans depending on your business size and scope.   

Payment methods

SecurePay supports all major payment methods:

• Credit card and debit card (Visa, Mastercard, American Express) 

• PayPal

• Apple Pay

• Phone payments (IVR)

Pros of SecurePay

The pros of SecurePay are as follows:

• Seamless integrations

• Simple and detailed reporting

• Supports multiple payment methods

• Offers hassle-free currency conversion

• Offers top-grade security and fraud protection  

Cons of SecurePay

The cons of SecurePay are as follows:

• Limited international reach

• Fees for gateway-only plans can be complicated

Stripe

Stripe, a widely accepted payment gateway solution, is PCI-compliant and used by millions of businesses of all sizes - from scaling startups to global enterprises. Businesses that use Stripe can add a virtual terminal to their Stripe platform. Stripe’s optimised checkout suite delivers a frictionless customer experience. It helps merchants improve revenues and save thousands of engineering hours with pre-built payment UIs, easy access to more than 100 payment methods, and Link, Stripe’s one-click checkout. It also has a pre-built payment form that can be easily embedded on your site or redirected to a Stripe-hosted page. You can even customise the colours and fonts to match your brand and add support for recurring payments and Stripe Tax with no additional integration work. 

With Stripe, you can get automatic fraud prevention with no integration required. Radar’s machine learning models are trained on hundreds of billions of data points, which means even if a card is new to your business, there’s a 91 per cent chance it’s been seen before on the Stripe network. Stripe securely shares Radar fraud scores to help participating issuers, including Capital One and Discover, make more accurate authorisation decisions.  

Pricing

Stripe offers two pricing plans: Standard pricing and Custom pricing. The Custom pricing plan is designed for businesses with large payment volumes or unique use cases. You’ll need to contact the sales team to get custom quotes. The Standard plan offers simple, pay-as-you-go pricing that requires no setup fees, monthly fees, or hidden fees. It has different transaction fees for domestic and international cards and a fixed fee. 

Payment methods 

Stripe supports the following payment methods: 

• Credit and debit cards (Visa, Mastercard, American Express)

• Google Pay

• Apple Pay

• Alipay

• PayPal

• WeChat Pay

• Click To Pay

• Bank transfers

• Buy now, pay later

• PayNow

Pros of Stripe

The pros of Stripe are as follows:

• Developer-friendly API

• Extensive documentation and resources 

• Supports over 135 currencies in 47 countries 

• Supports major payment methods 

• No hidden fees and a clear pricing structure

• Easy integration process

• Recurring payment automation

• Range of powerful tools that can be customised

Cons of Stripe

The cons of Stripe are as follows:

• Requires technical expertise for set-up and customisation

• High processing fees

• Account suspensions

• Delay in customer support

Choosing the right payment gateway for your dropshipping store 

If a payment gateway declines a transaction, the payment won’t go through, resulting in potential sales loss. So, you should choose reliable and best payment gateways to avoid losing sales and customers due to transaction denials. 

Factors to consider when choosing the right payment gateway for your ecommerce business

There are many aspects to bear in mind when selecting the payment gateway for your online business. The checklist below will help you make the right selection. 

Transaction fees and monthly fees

Each payment gateway has its own pricing models, and their transaction fees and monthly fees vary. Some payment gateways charge a percentage per transaction and a fixed fee. Understanding these costs is crucial for your business’s profitability. Before you select a payment gateway for your online store, you should compare the transaction fees and monthly fees of multiple platforms, and choose the one that aligns with your business needs.

Supports multiple payment methods

Your payment gateway should be flexible enough to process payments from different payment methods. Offering just one payment method may discourage your customers from completing their transactions, resulting in cart abandonment. The payment gateway you choose should be able to accept major credit card payments, PayPal payments, contactless payments, payments via popular digital wallets, and other payment methods.

Security and compliance

Security is of utmost importance while handling online transactions, so choose a secure payment gateway for your ecommerce store. You’ll need to ensure your customer’s card details and your business data stays safe. Many popular payment gateways offer security features like encryption, tokenisation, and fraud detection tools. They also come compliant with the best security standards like PCI DSS. Selecting a payment gateway that meets the security standards and offers security features can help maintain a secure environment for you and your customers.

Integration

Compatibility with your ecommerce platform is essential. A payment gateway never functions on its own, it’s a part of your website. Your website could be on Shopify, WooCommerce, WordPress, or Magento. You should ensure that the ecommerce payment gateway you choose can seamlessly integrate with your ecommerce platform. If it doesn’t integrate well with your ecommerce platform, your online payments won't be processed due to system glitches and may cause your customers to abandon their carts.

Simple and easy checkout process

Checkout is the most critical stage in the conversion funnel. The checkout experience is the ‘make or break’ point. According to a study conducted by the Baymard Institute, 69.99 per cent of customers abandon their carts for reasons such as a slow website, no customer support, too many forms to fill, and failed payments. As it’s the final stage in the customer’s buying journey, the checkout process should be seamless. Adopting a customer-centric approach and leveraging data from customers’ previous transactions can help in understanding their preferred payment methods and addressing their payment-related anxieties. 

Customer support

Every ecommerce business owner wants to grow their business. Choosing a payment gateway that can scale with your growing business without causing disruptions is important. As your business grows, the payment gateway you choose should be able to accommodate the increased demands of your customers without compromising performance. Check with your ecommerce payment gateway provider if they provide any extra features to suit your ever-growing business needs. Additionally, you should ensure that the support team offers robust customer service in case of technical emergencies. Should something go wrong, customer support needs to be available around the clock and provide assistance.

Hosted or non-hosted

Hosted payment gateways redirect customers to a different payment page that is hosted by a payment gateway provider. They are simpler to implement and ensure PCI compliance, making them suitable for smaller businesses. Contrarily, non-hosted payment gateways integrate directly into the merchant’s website. They offer more control and customisation options, making them suitable for large businesses willing to invest in integration and security measures. Whether to choose hosted or non-hosted payment gateways depends on several factors such as the size of your business, security preferences, customisation, and technical expertise.

Multiple currency support

Not all payment gateways are designed to accept multiple currencies. If you’re selling worldwide or planning to take your business global, you should choose an ecommerce payment gateway solution that accepts multiple currencies. Some ecommerce payment gateways automatically convert prices into customers’ local currency and allow them to pay in their local currency, making the checkout process easier and more convenient. After the transaction has been completed, the payment gateway converts the currency into the merchant’s local currency at the prevailing exchange rate.

Transaction limits

When selecting a payment gateway for your ecommerce store, consider the maximum transaction amount allowed. Ensure it meets your business needs. If you anticipate high-value transactions, choose a payment gateway that accommodates your business needs. Understanding and adhering to transaction limits set by payment gateways prevent disruptions in payment processing.

Settlement period

Consider the time it takes for funds from transactions to be deposited into your merchant account. A shorter settlement period provides quicker access to funds, improving cash flow. You must choose a payment gateway with a settlement period that aligns with your business’s requirements.

Start dropshipping with Dropshipzone today

Having access to reliable and versatile payment gateways is essential for seamless transactions and customer satisfaction. Dropshipzone stands out as a comprehensive dropshipping platform that offers convenient payment solutions. With options for credit card payments, wallet, and PayPal integration, Dropshipzone streamlines the ordering and payment process for Retailers, ensuring efficiency and convenience. Join Dropshipzone today for free, a low-risk scaling solution you need for your business growth.