10 Online Payment Service Providers You Need To Know About

Photo of Krzysztof Jackowski

Krzysztof Jackowski

Dec 16, 2014 • 12 min read
woman typing on a keyboard and holding a credit card

If you’re running an e-commerce site then you will undoubtedly be using a payment service provider (PSP) of some sort or another.


The ability that a website provides you to be able to take your business anywhere in the world has made the provision of PSP services essential. PSPs accept payments electronically, usually by credit card or bank transfer, and manage transactions between buyers and sellers.

One of their greatest attractions is that they offer risk free guarantees that payments information is protected against theft and/or fraud. Consumers trust them and so do sellers, and so, simply put, you need to utilise the services of one (or more) for your online store.

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There are, however, quite a lot to choose from, and indeed it can seem like a bit of a minefield out there when deciding on which one is right for you and your site. And that is why I’ve been tasked with putting together a list of the top 10 online payment providers, and shall be listing the various pros and cons of each in the details below.

But first, let’s take a closer look at how PSPs work and some of the finer details about what you need to know when it comes to choosing one.

How PSPs Work


The purpose of payment service providers is to help merchants accept payments made online. They offer e-commerce merchants a single interface that opens up to one or more online payment methods. They enable business to accept credit cards or other payments (direct debits, bank transfers, digital wallets etc.)

There are three types of PSPs – distributors, collectors and aggregators. They all enable the ease of online payments, however where they differ is in payouts, fees and contracting. Let’s take a look at each a little more closely.


Distributing PSPs remove the technical burden for e-commerce merchants by building and maintaining the connections to many different payment methods. By connecting to one distributor, your online store will be able to accept payment methods of several types. Having said that, distributors are nonetheless usually the choice for merchants who only offer a few payment options. Skrill and GoCardless are examples of distributing PSPs (see below for more details on these).


Collecting PSPs streamline settlement for all accepted payment methods. By combining all payments into a single settlement, payment reconciliation is simplified. Without using a collector, merchants would receive separate settlements for every payment method they accept, and therefore the time and cost it would take to match orders with received settlements would prove to be uneconomical. Collectors are the PSP of choice for merchants who offer lots of payment options. PayPal, Braintree Payments and PayMill are all collecting PSPs (see below for further details).


Aggregating PSPs accept payments, collect the funds for and contract with individual payment methods. They differ from collectors in that they contract with the payment company on behalf of multiple merchants; the difference from distributors is that they also collect funds, negotiate the payment terms and settle the merchant’s bank account. Merchants who offer only a few payment methods, but prefer not to contract with financial institutions, banks, and other payment method companies favour aggregators. Stripe, Braintree Payments and Skrill all offer aggregating PSPs.

10 Online Payment Service Providers You Need To Know About



PayMill is a fully customizable PSP and official netguru partner! It allows online merchants to design a fully optimised checkout experience for high conversions. PayMill accepts all major credit cards and debit cards, as well as some local payment methods.

These include: American Express, China Union Pay, Discover, VISA, Diners Club, MasterCard, JCB, Carte Bleue, CartaSi, Dankort, Postepay, VISA Electron, V Pay, and Maestro. There are no monthly fees and no setup fees, pricing is based on a percentage per transaction (2.95% + €0.28 for credit and debit cards, and 3.95% + €0.28 for American Express).

Get to know SnapScan, a mobile payment provider operating in South Africa.


Perhaps the best known PSP in the world, PayPal is used by literally millions of people and is the preferred payment method by many. Indeed, according to the site, having a PayPal button on your page will increase your sales by 31% on average – that’s surely enough to convince most people about the service. Again, a customisable checkout is available, and payments can be made on mobile devices. Standard fees are 3.4% + £0.20 per transaction.


PayU is available in 18 countries and deals with over 100,000 merchants. It offers more than 20 payment options and is part of the international Naspers Group. It uses innovative technological platforms to provide the highest quality of provided services with high functionality and stable development.

PayU is available for use for merchants doing business in Brazil, Czech Rep., Hungary, Kenya, Panama, Poland, Russia, Turkey, Argentina, Colombia, Chile, India, Mexico, Peru, Romania, South Africa and Ukraine. Netguru has created an open source extension that allows you integrate your Spree store with PayU, which allows visitors to your site to choose PayU among any other payment methods you make available.



Stripe is a PSP that is built to enable businesses to easily accept and manage online payments. Stripe is integrated with literally thousands of mobile apps for both iOS and Android, including Lyft, Postmates, OrderAhead and Instacart. Also, companies like Rackspace and Parse use stripe to manage subscriptions and recurring revenue.

With a complete suite of APIs, storing customers’ cards on file and implementing complex payments functionality is extremely easy. Fees are 2.9% per successful charge plus $0.30 (USD). If you want to see a real life site's example where payments system is built on Stripe Connect, visit Inn Style, a beautiful booking system.


Here at netguru, we were very happy to work with Skrill to create an application for online account management. Skrill has been around since 2001, and now supports over 100 payment options for customers, who can send and receive money in more than 200 countries worldwide in nearly 40 different currencies. The Skrill Global Payment Suite allows you to accept global payments easily, securely and at low cost. Merchant fees vary from 1.4% to 3.9% + €0.35.

Braintree Payments

Braintree is a PayPal company, and, as such, it accepts nearly all the payment methods that it’s parent company does. Available in 40 countries and 130 currencies, Braintree accepts PayPal and most credit and debit cards, including MasterCard, VISA, American Express, Discover, Diner’s Club and JCB. Merchants receive payment typically between 1-4 weeks, and there is no minimum or monthly fees – you only pay for the transactions that you process after the first £30,000, and then it’s just 2.4% + £0.20 per transaction.



GoCardless is all about direct debits. It sells itself as being the “quickest and easiest way to take one-off and recurring payments online.” There are no setup fees, and everything is automated, from the taking to the tracking to the reconciliation of your payments. Since it utilizes a direct debit system, customer retention is high due to the fact that customers are not lost through card expirary or cancellation. Fees are just 1% per transaction, and are capped at £2.00.


FastSpring is more than just a PSP but a means through which you can create your very own online store from scratch. As such it is a premium service and the fees reflect this, which can be as much as 8.9% per transaction. FastSpring allows you to build a highly customisable hosted order page, that integrates with your existing website design, and automatically displays to customers in their local currency and language. Payments are sent to merchants bi-monthly.

Square Register

Square Register is designed for mobile and tablet, and specifically Apple and Android devices. It takes care of all digital receipts and sales reports, and provides you with analytics so you can glean business intelligence from your customers about their payments. With automatic upgrades continuously being sent out, it is a service that is dedicated to making constant improvements to help you run your business. Support 130 different currencies, Square Reader is nonetheless only available for merchants in the US, Canada and Japan.


Recurly is a PSP that is designed to help you grow your subscription business and advertises itself as being the “leading recurring billing platform”. With automated email notifications that let customers know about any discounts, promotions or price-hikes etc., Recurly also handles metered billing, if your business requires that you bill your users based on variable usage and spend. Pricing varies from $99.00 per month to $299.00 per month plus a percentage.


Of them all, PayPal is obviously the most widely used and in some cases expected payment service provider that online merchants resort to often by default. However, PayPal doesn’t have all the answers, and all of the others on this list are every bit as good in what they do as the undisputable giant amongst them.

Choosing a PSP can be difficult. There is a lot of competition, and a lot of confusion and data to plough through before you can make a fully informed choice. Importantly, your decision should not be dictated based on price alone. Indeed, you may well find that FastSpring, the most expensive among them, offers you precisely what you need where the others don’t. In the end it will come down to a combination of 4 things: support, simplicity, security and price, and only the right blend of these elements should you ever consider using when it comes to choosing your perfect PSP.

Before you pick up a payment provider there are also a few Things To Remember When Creating Perfect Checkout Flow - an informative read for all e-store retailers.

Photo of Krzysztof Jackowski

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Krzysztof Jackowski

Software Developer and Team Leader
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