We do a lot of e-commerce websites and one thing that many people don’t
know that if you want to sell something online, you need to have what’s
called a "merchant account" with a payment company. Your payment
company might be your bank or another organization like PayPal. If you go with a bank (will will set you up with a payment processor like Verisign or Authorize.net), you’ll most likely get better transaction rates. For example, with Paypal,
there is roughly a 3% transaction fee, where as most other merchants
charge around 2.2%. BUT, most banks will have a monthly fee of around
$40, where Paypal does not. So if you anticipate moving a lot of product, or large amounts, a credit card merchant other than Paypal may be ideal. Keep in mind Paypal, as well as other credit card merchants, have several different plans, so this is a generalization, for simplicity’s sake.
An advantage of Paypal,
other than there not being a monthly fee (unless you get one of their
higher plans), is it is quite easy and quick to set up. Create a new Paypal account and then you have to link your account to your bank account, so you can make deposits from your Paypal account
to your bank (which is something you have to do manually, but there is
no charge for it). Then you verify your account by entering in the
amount of two small deposits Paypal will
make into your linked account. This is how they make sure you indeed
own that bank account. If you don’t link to a bank account, Paypal can mail you a check, but there is a small fee for that service.
So
it’s best to shop around with credit card merchants and get the best
rate you can, but also make sure it is compatible with whatever
shopping cart system you may have.