Month: August 2006

Audio available: [audio:2006-08-27_third_party_payment_processing_for_your_web_store.mp3]

When I started selling online just over three years ago, accepting payments online was a long way from ideal. You could either do it the expensive way, or you could do it the cheap way.The expensive way meant get a credit card merchant account and set up a secure website using SSL to process the payments yourself, or use a third party processor to do it for you. Very messy and a lot of work if you’re only going to do a few sales per week.

It also made you a target for hackers interested in your credit card details database.

The cheap way was to use PayPal, NoChex or similar, but that meant anyone that wanted to pay you had to have (or open) an account with that processor which a lot of people just wouldn’t bother doing and so you were losing out on sales.

The middle of the road at the time was a merchant account with WorldPay, but I wouldn’t recommend them to anyone. I gave them a call to find out how much it would cost. They wanted a $9000 float, they were going to charge nearly 6%, and they’d keep my money for 28 days before passing it on to me.

Er yeah, right. Thanks, but no thanks.

Seriously though, I consider that an insult to anyone with a brain. Because of that, I’ll never deal with WorldPay even if they now give the best rate.

While I was investigating all this, I came across Protx who act as a third party processor if you have a merchant account. At the time this was the cheapest option.

So I took out a merchant credit card account with my bank, and used Protx to handle the processing of cards. This meant I didn’t have to keep any card details and I didn’t have to secure my site, so it was pretty good while not ideal.

It cost about the same as it would have to set up a secure site, and took away any chances of a security breach, so I was very grateful. Protx are also very responsive, so still a good option even now.

Three years later, things have changed quite nicely for small businesses.

You now have a choice of payment processors depending on your location in the world. PayPal is probably the most used one, and in North America and the UK at least, there is no longer a requirement for your customers to sign up so that’s good.

NoChex works in a similar way but is UK only. There’s now also MoneyBookers which are UK based but international in scope like PayPal and have over 2 million users according to their website. There are other larger processors such as 2CO and .

And there are probably others in your country that I’ve never even heard of.

In fact there are so many third party payment processors now, that there’s really no need to hold a traditional merchant account any more, and unless Mastercard and Visa turn back the clock (a distinct possibility), it will become cheaper as competition increases.

Now there’s one more new one and I’ve left this until last. The brand new, shiny, Google checkout.

Unless I’ve missed something somewhere along the way, I can’t see the point.

In order for you to use it on your website(s), you need to secure every site. That means purchasing an SSL certificate for each and every site every year if you want to use it.

I don’t care how convenient the rest of it is, if it makes me do something additional that I don’t have to do now, then I’m not going to bother.

It may be that they’ve done it this way because of the rumblings in the Mastercard and Visa camps over third party processors. So if things do change all processors may have to insist on SSL. Then it may be worth considering Google.

We’ll see…

Audio available: [audio:2006-08-25_payment_processors_-_do_they_have_a_duty_to_protect.mp3]

As I pointed out in another post, at some point PayPal have taken the decision to block any payment processing for anyone that they consider to be part of a pyramid scam, or even MLM (Multi-Level Marketing) which is a completely legal way of marketing your business. 

That’s their business, and their decision to make, and I don’t think it’s right to criticise them for that.  We all want to run our businesses in our own way, and if a third party doesn’t like it, then they can go and use someone else.  I’m a strong believer in giving people a choice.

However, someone recently emailed me to say that PayPal will also close down accounts of people who they believe are participating in "Get Rich Quick" (GRQ) schemes.

Hmm…

There’s a subtle difference between pyramid and GRQ.  Pyramid is a GRQ scheme, but a GRQ scheme doesn’t necessarily have to be pyramid.

I don’t know why, but I just feel a little bit uneasy about this.  Once someone decides to set themselves up as judge, jury and executioner, then I think they’re on very dodgy moral ground.

I understand that they feel they have a duty to protect their customers, and it’s likely this is a response to demands from customers, but have PayPal overstepped the mark?

Should a payment processor only provide payment processing services or should they also get involved when it comes down to what they see as immoral / illegal practices by other businesses? Or is this even a start to a big clean up in the whole third party payment processing industry?

Mastercard and Visa have recently closed down some third party processors similar to PayPal, due to them not adhering to their standards / guidelines.  Rumours are that 2CO are also in the firing line.  Maybe PayPal are getting a little twitchy that they could suffer the same fate and so are clamping down.

If so, it’s long overdue.  But they have to be very careful not to further tarnish their image by shutting down legitimate business processing for all the wrong reasons.

Audio available: [audio:2006-08-19_imap_what_your_isp_doesnt_want_you_to_know.mp3]

Do you use IMAP? Do you know what it is? Can you find any mention of it on your ISPs website?

I bet that for most people the answer to those questions is no.

IMAP was supposed to be the replacement for POP3, well, that’s what I was told by a techie years ago when I was introduced to it, but it doesn’t seem to have worked out that way. I haven’t seen one ISP promote IMAP and they all tell you how to set up POP3, and there’s a good reason for this.

IMAP is much better for you, but it uses up more of your ISPs resources. So they either don’t support it, or don’t tell you about it.

So what’s the difference between IMAP and POP3?

I won’t get all techy here, because I can’t, so here it is in layman’s terms. When you set up your mail client to retrieve your email, the default is usually POP3, and you have to select IMAP as an alternative if you want to use it.

The default setting in your email software for POP3 is to retrieve your email from the mail server and store it locally in the database of the email software you’re using. i.e. the email is stored on your PC and is removed from the mail server.

With for example Outlook Express (OE), you can tick a box to leave the email on the server if you don’t want it deleting, but if you forget to do this, all the email will be pulled from the server one at a time and then deleted on the server leaving you with a copy only on your PC.

But what if you have two PCs? One at work and one at home, or one in the study and one in the family room, or a laptop and a desktop, and you want the same email messages on both machines? Or what if you’re like us and have several PCs and you need all of them synchronised with the same emails that you’ve both received AND sent?

In that case you need IMAP.

How IMAP differs from POP3 is that the email messages are all left on the server. And when you send an email, that gets stored on the server too. If you flag an email, then the flag gets set on the server against that email.

The beauty of this is that if you sit down on your laptop and send an email, then later sit at another PC that’s been set up with the same email account, the second PC will connect to the email server and download your SENT message as well as any new received ones. So both machines are synchronised with the same emails.

All the email messages remain on the server so that if you sit down at a third PC that’s also been set up with the same email account, it will again download all the messages and so you then have all three PCs synchronised.

This is very cool in my opinion.

Even if you only have one PC, IMAP is a much better way of handling your email. If your only PC ever fails and you end up with a corrupted hard drive, you don’t lose your emails. They’re all on the server.

So then all you have to do is fit a new hard drive or buy a new PC. When you set the email account up again on your new system, it gets all the messages, and you haven’t lost a thing. You may have to re-create your address book again if you don’t have a backup, but at least you have all the email addresses, because you have all the emails!

The downside for ISPs is that they have to store all of your emails all of the time on the hard drives of their servers. And they don’t want to do it. So they don’t advertise IMAP at all. They want your emails off their server and on your PC ASAP.

Like I said at the beginning, some ISPs don’t even support IMAP. But if you have your own seperately paid for web server with cPanel, it usually comes with IMAP pre-set up, and all you have to do is connect to it.

There are other benfits to IMAP too, such as the ability to drag and drop emails between accounts, just like you do with folders on your desktop.

Why don’t you go and take a look now to see if you can use IMAP? You never know it might be your lucky day.