Choosing a B2B payment gateway on BigCommerce

One of the benefits of building your B2B ecommerce store onBigCommerceis the Apps Marketplace. It enables you to customise your store’s functionality, design, UX and administration to suit your precise business needs. Among the hundreds of available apps, there are over 65 integrations just for payment gateways. So how do you choose the right one? In this article, we will explore some of the major factors to take into account when choosing the payment gateway for your B2B store on BigCommerce.

What is a payment gateway?

BigCommerce describes the payment gateway as the metaphorical cash register of your ecommerce store. It is the software that facilitates secure online payments whether by card, digital wallet or another alternative payment method. While the payment processor (a phrase you may have heard used interchangeably with payment gateway) is the metaphorical card machine that reads your customer’s credit card and checks the information with the bank. Payment gateways integrate with your website’s checkout journey in three different ways:

• Redirects such as PayPal take the customer away from your website to the payment processor’s secure payment page.
• Checkout on-site, payment off-site like Stripe, where the front-end of the checkout is on your website while the payment processor’s backend system processes the payment itself.
• On-site payments such as Mollie where the entire process takes place on your website.

There are pros and cons to the different types of gateway, redirecting to a different site can deter customers and increase abandonment rates, however, keeping the entire process on your own page also gives you the full responsibility for the security of your customers’ data and the payment process.

Factors to consider when choosing a B2B payment gateway

Why are B2B payments different from B2C?

You might think it’s all ecommerce, how could B2B (business to business) be that different from B2C (business to consumer)? Well sure, the mechanics are fundamentally similar – select the product, add it to the basket, pay, wait to receive your order. However, there are significant differences that affect how the online store needs to be built. The average value of B2B transactions is considerably higher than B2C and the volumes of products purchased are significantly larger. Consider a shop restocking its toy aisle compared to a parent buying a single doll for their child. Some payment gateways are better suited to high volumes and values than others. An important difference that ecommerce stores may need to accommodate is price variation. On a B2C site, the price does not change apart from occasional special offers. In B2B transactions, there can be room for negotiation, depending on a number of factors including the relationship between buyer and seller, or the number of units being purchased. Other differences include longer sales cycles, more decision-makers involved on the client’s side, invoicing, and alternative methods of payment than the ones used by individual consumers on B2C stores. All of these can play a part in the design of your store and your choice of apps including payment options.

Consider regional payment preferences

Do your research on what B2B payment processors are popular and trusted in your country or region or those of your customers. For exampleiDEALin the Netherlands,Boltin the USA, orAlipayin China, might not be obvious choices to businesses based in the UK or Australia. Wherever your target market is based, whether local or overseas, make sure you can provide them with the payment options they prefer, to avoid cart abandonment. Different payment gateways will facilitate different payment processors, so make sure to choose a gateway that will accommodate the preferences of your customers.

Which payment methods should your business offer?

As we already mentioned, businesses pay by different methods than individuals. One of the most common forms of payment in B2B transactions is trade credit; the World Trade Organisation estimates80-90% of all B2B paymentsrely on it. However, traditional trade credit, essentially an interest-free loan between seller and buyer, is a very slow process of application forms and credit checks. It also represents a financial risk to the seller as they part with their product before being paid. Digital “buy now, pay later” options such as PayPal Pay Later have much faster, more streamlined application processes and allow the buyer to make their purchase and pay back in instalments, while the seller is paid immediately and the payment provider takes on the risk of the loan. Many B2B services involve subscriptions – office or cleaning supplies for example will need to be replenished regularly. And of course, there are also the more traditional company credit card payments and the increasingly popular use of digital wallets. It is important that a B2B merchant’s checkout can accommodate all of the possible payment methods their customers might wish to use so as not to lose sales at checkout.

Payment gateways and customer trust

According to the Baymard Institute,18% of cart abandonmentsare due to customers lacking trust in the merchant’s site. Choosing the right payment gateway and the right B2B payment processors can help gain your customer’s trust and reduce abandonments. Household names like PayPal or Apple Pay help reassure customers. A 2018 study by ComScore found that merchants that accepted PayPal had a47% higher conversionrate than competitors that didn’t. While a study by Kelton Research found that73% of shoppersvalue security above convenience. Particularly with the order values of B2B transactions, buyers will be reluctant to take any perceived risks with their company’s money and will rather abandon the cart and find a different supplier that will accept payments via multiple trusted processors. As mentioned above, seeing the local preferred payment method available will also make buyers feel more comfortable. It is possible to stack more than one payment gateway, although BigCommerce doesn’t suggest more than two or three at most. This can provide benefits including access to both local and global payment solutions, and increase customer trust and conversion rates.

How can we help?

Of course, there are many more factors to consider when choosing your B2B payment gateway and tailoring your ecommerce store to suit your business needs. Calashock is a BigCommerce Elite Partner with over 12 years of experience. One of the longest-running ecommerce agencies in Europe to specialise completely in BigCommerce, with particular expertise in B2B ecommerce businesses. We know the platform in and out. From re-platforming to customisation, whatever your question, our team of experts will help you build the perfect solution.Get in touchtoday to discuss your needs and kick-start the next stage of your e-commerce journey.