Picking the Right Payment Service Provider

A big part of ensuring customer satisfaction is making payments easy. After all, it’s likely to be the least pleasant part of the purchasing process for customers, so making it as simple and straightforward as possible is crucial. But, to do that you’ll need a good payment service provider (PSP).

In this article, we’ll explain what a payment service provider is, highlight some of the characteristics you should look for (and avoid) when shopping for a PSP, and list our top three UK payment service providers for small business. Read on to learn more.

 

What is a Payment Service Provider?

Payment service providers (also referred to as PSPs) are a type of business that facilitates electronic payment transactions between various parties. For example, PSPs provide the digital infrastructure necessary for small businesses to take card payments from their customers. However, they also enable businesses to accept a wide range of other payment methods, including more modern options like digital wallets and bank transfers.

PSPs provide businesses with the necessary infrastructure and security measures to allow them to process payments securely and efficiently. While some payment service providers only offer the basic service of payment facilitation, others provide comprehensive consultation and support services to their client businesses. Some of these support services include benefits like added security, fraud protection, and regulatory compliance assistance.

Payment services are a huge market and are continually growing as digital payments become more popular. In 2023, the UK PSP market size was worth £11.4 billion, representing a 3.8% increase on the previous year.

 

What To Look For in a Payment Service Provider for Small Business

There are a variety of important attributes to look for in a payment service provider. Below, we’ll explain in more detail what each of these means.

 

Reliability

Finding a trustworthy, reliable provider is paramount. You’ll want a PSP that has a well-established reputation, preferably because they have a history of positive customer reviews and are known for the quality of their customer service. Picking a reliable PSP means there’s a significantly reduced chance of things going wrong, but if issues with the service do arise, you’ll have a clear path to a solution.

 

Speed

When it comes to payment service providers, speed refers to the speed of settlement, which is the process of the customer’s bank transferring funds from their account (via your PSP) to your bank. If it’s possible within your area of operations and within your budget, try to aim for next-day settlement. After all, having to wait multiple days for customer payments can wreak havoc on your cash flow.

 

Security

Your payment service provider will have direct access to your financial information, so data privacy is a must. Security is one of the easier points to look for, because the level of security a PSP offers is clearly displayed in the certifications they have. Additionally, PSPs that comply with financial industry security standards will clearly advertise this.

 

Transparency

Unpleasant surprises (such as unplanned fee changes or settlement delays) can severely hamper your business operations. With that in mind, make sure your chosen PSP clearly advertises the cost of the service they offer, and provides a realistic idea of what you can expect from that service. If you’re unsure, get in touch with their sales team to get further information.

 

Scalability

You may only be a small or single-person business now, but it’s likely that you have larger ambitions and will seek to expand in future. If so, you’ll need a payment service provider that can scale alongside your business: the primary point to look for is a PSP with the capacity to facilitate a larger number of transactions, as well as the ability to do so from multiple locations. Choosing a PSP that doesn’t offer scalability means having to overhaul your payment system as you expand, which can be expensive and complicated.

 

Variety

As we mentioned above, making payments easy is essential if you’re looking to improve your customer experience. A good way of making things easy for your customers is to offer a wide variety of payment methods — whether they prefer using Apple Pay, credit, or debit cards, your provider should be able to process that payment for them. If you sell via both ecommerce and from a brick-and-mortar location, make sure the provider can facilitate multiple payment methods both in-store and online.

 

Integration

Accepting payments isn’t just about getting money from customers. You’ll want a payment solution that communicates data to your accounting software, inventory management systems, e-commerce setup, and more. You need to ensure that the provider you choose offers a solution that integrates into all these components, and that you have the expertise within your business to implement the solution into your existing tech stack.

 

User Experience

A good payment service solution should integrate seamlessly with your existing website and checkout process — lengthy loading times, redirects, or pop-ups are to be avoided, as are complex or poorly designed payment gateways. Anything that slows down or complicates the checkout process will harm the customer experience and decrease the chance of that customer returning to your business. An especially poor payment experience may prevent the customer from even completing the original sale.

 

Cost-effectiveness

While the cheapest option isn’t always the best, small business owners must often make the decision to balance quality with affordability. Look for a payment service provider that offers competitive transaction fees while also providing all the essential support services you need. Meanwhile, if your budget is limited, you may need to think about which additional features are “needs” and which are “wants” before choosing a PSP.

 

Best UK Payment Service Providers for SMEs

Global Payments

Global Payments offer a comprehensive service, with a huge number of additional features. However, their basic offering covers a wide range of payment methods for both in-store and online purchases. They even cover “on the move” payments through their mobile app, allowing you to facilitate sales through your smartphone.

The additional features include access to in-depth payment insights (allowing you to make data-driven decisions about customer buying behaviour) and a Dispute Management System (which can significantly reduce the amount of time you spend resolving payment disputes).

 

TakePayments

TakePayments are the UK’s most trusted payment service provider for SMEs, based on a significant number of 4- and 5-star reviews on Trustpilot (considerably more than competing PSPs of a similar size).

A large part of this positive customer feedback comes from TakePayments’ focus on quality customer service, which includes a “Welcome Team” as well as a traditional customer service department that can resolve issues and answer questions.

The Welcome Team is specifically to assist businesses with setup an onboarding, which means using TakePayments is a great option if you’re looking to start accepting payments quickly or struggle with the technical aspect of accepting payments.

 

Trust Payments

Trust Payments takes a holistic approach to payments, combining banking, data, and sales into their omnichannel Converged Commerce solution. The solution offers easy integration with a wide variety of ecommerce tools. So, whether you’re building an ecommerce store from scratch, or looking for a new PSP for an established business, Trust Payments can help.

As well as their online offerings, Trust Payments can support in-store transactions with a range of card machines and other over-the-counter payment tech. These tools include useful functions like dynamic currency conversion, which lets customers pay in their local currency.

 

Build Your Business With 365 finance

Once you have chosen an appropriate payment service provider, you’ll have access to a whole new world of financial services. For example, being able to take card payments makes you eligible for funding via 365 finance’s Rev&U solution.

Rev&U is a fast, accessible way for small businesses to acquire funding for projects like equipment upgrades, staff acquisition, and property purchases. Rev&U merchant cash advances are low-risk and low-pressure, as repayments are based on your monthly income — so if you’re having a slower sales month, you don’t need to worry about unaffordable repayment amounts.

At 365 finance, we can provide both long and short-term financial solutions, with revenue-based funding available from £10,000 to £400,000 in capital. Apply for Rev&U today without affecting your credit score, or speak to our team to find out how we can help your business. To find out more, head to our website.