On the surface the various B2B Payment Gateway Australia offerings are indistinguishable. Then a wholesale customer comes along with a purchase order or a multi-currency invoice, wants a recurring debit or has to have a refund divided up over a number of shipments. Stripe, Airwallex, GoCardless, BPAY and CommBank Powerboard will all make the payment happen but they are better suited to one sales model or cash-flow requirement than another.
Thomas Murphy here from Fremantle. In my part of the world “the system works” is code for it has seen out a hard Friday without anyone needing to put in a call to the bank. In this guide I put the integration options open to Australian businesses for their B2B online stores under the microscope, be it for platform compatibility, fees, security, scalability or how fast you can settle domestic and international transactions.
The function of a B2B gateway
It is the link between your online store, the customer and the payment provider. A B2B gateway will take the payment information and put it forward for authorisation in a secure manner, then report back to your order system, accounting software or ecommerce platform on the outcome. This supports tailored digital platform creation.
Do not confuse the gateway with the processor, merchant account or the bank; that is where some get tripped up. The gateway might be what gives you the technical connection and the checkout, yet an entirely different entity is moving the funds, doing the fraud checks and putting the money in your account.
The nature of wholesale payments
A consumer will put an item in the cart and pay. With B2B you are more likely to have orders in cartons, a request for an account price, a purchase order or someone in finance having to give the go ahead. The gateway for an Australian online store should accommodate the realities of how business is done, not just put a nice card form on screen.
Reconciliation has to be dependable. When a payment goes through it needs to tie in with the right tax invoice, order number and customer. Otherwise staff will be manually going through hundreds of deposits and you will find the cost of a cheap gateway adds up in no time.
Options available in Australia
Most of the good B2B solutions in use by Australian businesses are ones that do not rely on a single method. You have cards for when an order is in a hurry, direct debit for your regulars, digital wallets to cut down on friction and BPAY for those who are invoice-led.
One cannot point to a best gateway across the board. It is a matter of what makes sense given your risk profile, the platforms you run on, how often you bill, where your customers are and if you do any business overseas.
Cards, digital wallets and the like
For a deposit or an urgent stock order, or a customer disinclined to set up an account, credit cards are still handy. Apple Pay and Google Pay expedite the mobile checkout process, while PayPal has its place with customers put off by anything but an account-based payment.
Afterpay and Zip could work for a small-business or b2c transaction of a certain type but are not wholesale material. See if your commercial clients want to put things on instalments and look at the costs and maximum order values before you decide.
Invoicing and direct debit
GoCardless is the name that comes to mind for direct debit and anything on a recurring basis. For an approved Australian customer on a monthly schedule BECS Direct Debit is well suited.
An established trade account will still want to invoice. But make sure the system is not just a payment strategy in disguise. You want to see the due date, partials, credit notes and any failed debits and not have to resort to a spreadsheet to do it.
BPAY and bank transfers
Australian businesses know BPAY and it is fine for the customer who would rather pay from his bank account. It is a help with invoice-led buying even if you do not get the same instant confirmation as with a card.
Then there is the bank transfer for a sizeable wholesale order. Have your reference numbers and fulfilment rules in order. Do not be sending off costly stock on the word of a customer that the transfer is “on the way”. You will regret it come Monday morning.
B2B Gateway Comparison
Use the table as a point of departure. But terms of commerce have a way of changing with respect to pricing and settlement, so check with the provider first hand before you put pen to paper.
| Provider / Method | Best Fit | Strengths | What to watch |
|---|---|---|---|
| Stripe | For modern ecommerce and the like, or custom platforms | Developer tools, broad support for the platform, cards and wallets as well as recurring payments | Proper tax and reconciliation set up is a must; also factor in fees for processing and any disputes |
| Airwallex | The cross-border trader | International transactions, multi-currency options and financial tools that are all connected | Make sure you know the supported methods, what you will be paying in conversion and on which currencies settlement is made |
| GoCardless | Where B2B billing is on a recurring basis | Collection of direct debits and scheduling of payments | Mandate setup can be an issue and you will have to put up with failed debits and confirmation times that do not compare with an instant card |
| BPAY | Australian trade accounts run from invoices | A domestic method your business customers will know | Payment confirmation timing, reference management and the reconciliation process |
| CommBank Powerboard | An option for those wanting a banking tie-in in Australia | Merchant services from the bank and online card acceptance | Look at the contract, how reporting and settlement is arranged and the platform connectors |
| PayPal | When the customer wants to check out via an account | Speedy checkout under a brand they recognise | There are commercial fees to consider and the matter of reconciling between systems and handling account disputes |
| eWAY | Established gateway services for the Australian merchant | Integrations for ecommerce and a familiarity with the local market | Do some comparison of the pricing and what payment features and plugins are on offer |
| Adyen, Braintree or Worldpay | Merchants of international standing or with growth plans | You get enterprise level and a range of payment methods | Be aware of the complexity of integration and minimum requirements, not to mention the effort to implement |
In my experience the case is straightforward: Stripe is apt for a custom build of some flexibility, Airwallex should be on your radar for its international payments, GoCardless has much to recommend it for direct debit on a regular cycle and BPAY is still of use with the Australian buyer who likes to settle by invoice. Then there is CommBank Powerboard, eWAY, PayPal, Adyen, Braintree and Worldpay which can all make sense given the technical demands and one’s relationship with the bank.
Choosing Your Payment Mix
Let the way your customers behave dictate the checkout, not some internal enthusiasm for the technology. Find out how they pay and how long it takes them, see which orders end up in dispute and how much of the staff day is spent on reconciliation.
A good mix for an Australian B2B store might be card, Apple Pay or Google Pay for speed, BPAY or a bank transfer when it comes to invoices and direct debit on approved repeat accounts. Unless the margins and demand warrant it, leave Afterpay, Zip and PayPal off the table.
Match Methods To Orders
Cards and digital wallets are fine for small urgent ones. For large repeat orders an account checkout with invoice terms or BECS Direct Debit may be more fitting. And while an international buyer will want local methods and to pay in their own currency, do not think that putting a foreign currency on display absolves you of exchange-rate risk.
All too often the order flow is handled incorrectly, with payment methods selected before any thought is given to fulfilment. You should be mapping the whole course from quote through to dispatch, credit note, refund and settlement. Should a customer alter an order once authorised, your system needs to inform staff of what is outstanding and what has been paid.
A Quick Fit Checklist
- See if the customer calls for cards, invoicing, bank transfer, BPAY or direct debit.
- Verify compatibility with whatever you are using, be it Shopify, WooCommerce, Magento or a custom solution.
- Put the fees side by side: processing, chargebacks, monthly charges, refunds and currency conversion.
- On the question of settlement, confirm the speed and currency and any reserve policies, including over weekends and public holidays.
- Run some tests on partial captures, accounting reconciliation, failed and recurring payments and refunds.
- And ask yourself where the data is held and what PCI DSS obligations are left to your business.
Integrating Popular Platforms
One does not want a platform integration to be nothing more than a payment button; it ought to cut down on the manual labour. Put the plugin or api to the test over the full order lifecycle, failed payments and tax invoices included.
Shopify and WooCommerce tend to be accommodating of common gateways these days. With Magento you will need to be more circumspect in your configuration of wholesale pricing, customer groups and so forth. A custom platform gives you control but the onus is on your developers.
Shopify And WooCommerce
With Shopify a smaller team can be up and trading without making an integration project a big deal. Just be sure the provider of your choosing has the B2B features you require and supports your currency and Australian merchants.
WooCommerce is more flexible in terms of plugins and the checkout but you have to maintain it. After a major update put the payment and order-management plugins through their paces together, rather than find the checkout is broken when a customer is in the middle of placing a sizeable order.
Magento And Custom Builds
Larger catalogues and the intricacies of wholesale rules are no problem for Magento. But you need to be technically disciplined about it; a failure to pay could be due to anything from server settings to webhooks or the tax logic in the checkout scripts.
With a custom build you can have the workflow you want, right down to payment status and customer credit. There is value in a tailor made approach when standard plugins are more trouble than they are worth. Rely on tokenised data and the security controls of the provider. Raw card details should not be stored unless there is a compelling reason and you are in a position to honour the obligations.
Security And Fraud Controls
This is an operating discipline, not something to be put in the footer for show. It means having audit logs, training your people, access controls and fraud rules that make sense, as well as secure checkout pages and keeping the software current.
The onus of PCI DSS compliance is a function of the integration model in place. While hosted payment fields will see to it that the card-data burden is lessened, they are not a panacea for all security duties; put in the time to verify what you are obliged to do with your provider and security adviser.
When it comes to fraud prevention one has to find an equilibrium between risk and conversion. An order of some value from a customer you do not know might warrant a phone call or manual review and address verification. Yet a rule of thumb that turns away any order from overseas will also turn away good customers. Keep an eye on chargebacks, failed attempts, odd order values and cards being tested.
For an understanding of the mechanics of Australian payments there are the statistics and official information on payment systems put out by the Reserve Bank of Australia. The Reserve Bank’s website for authoritative background on payments and financial market infrastructure.
Fees And Settlement Realities
Do not be content with the percentage on offer, look at the full cost. In addition to processing fees one can expect gateway charges, a fixed transaction element, monthly outlays, currency conversion, surcharges on international cards, minimums and costs associated with chargebacks and refunds.
Working capital is impacted by how quickly settlement occurs. A provider might authorise something in an instant but not put the funds to bed until later, be it for an international transaction, a risk review or simply because it is a weekend or public holiday. Find out if the timing they advertise is in business days, calendar days or “usually”, which in finance is a word of convenience.
Your own numbers should be the basis for any comparison. Put average order value, volume, refund and chargeback rates, recurring payments and the domestic/international split to the test. The Reserve Bank can give you context with its published figures but it is your order data that must inform the commercial decision.
Domestic And Overseas Sales
Reconciling a domestic payment is as a rule more straightforward given the use of local methods and the Australian dollar. You add to the equation with an international transaction: cross-border fees, currency conversion, sanctions screening, local card rules and longer windows for settlement.
If you are looking to expand internationally it would be worth a closer look at Airwallex, Adyen, Braintree and Worldpay. Stripe is capable of handling such use cases and PayPal has its appeal with certain overseas clientele. But before you make a promise at checkout, be sure of the countries, currencies and methods on offer for your Australian entity.
Who Should Use Each Setup
An enterprise stack is not called for by a small Australian wholesaler whose repeat customers are largely local; cards, BPAY, direct debit and invoicing will do. A multi-market importer on the up may require the likes of automated reconciliation, multi-currency options and more robust fraud controls.
We have put together this guide for the benefit of owners, operations managers and ecommerce teams who are weighing up a payment gateway integration before putting money or development hours into it. It is not to be taken as legal, banking, accounting or security counsel where regulated products, credit terms or international trade are a factor.
Spend a day with the providers and put them through their paces with a test order, a refund, a failed payment, a recurring debit and a settlement report. There is more to be learned from that than a well-rehearsed sales pitch. Have a developer and someone from finance go over the outcome together, they will each see a different trap.
Frequently Asked Questions
What Are The Most Popular Platforms?
Australian merchants tend to consider Stripe, PayPal, eWAY, Airwallex and bank-backed solutions like CommBank Powerboard. That is no guarantee they are right for you. Make your own B2B sales model the yardstick when comparing support, fees, platform integration and the like.
What Suits Small Businesses Best?
A provider with a sensible Shopify or WooCommerce tie-in, uncomplicated reporting and dependable support is often the way to go. A team comfortable with technology may prefer Stripe; if an established banking relationship or local knowledge is of importance then eWAY, PayPal or CommBank Powerboard could be more to your liking.
Which Method Is Mostly Used?
You will not find one method for every B2B purchase in Australia. Credit cards have their convenience but for trade accounts bank-based payments, BPAY, direct debit and invoicing are still important. Let the customer data speak for itself rather than some generalisation about the market.
What Are Three Payment System Types?
In broad terms there are alternative or digital methods, account-to-account or bank-based, and card-based payments. A B2B store in practice might have a mix of cards and wallets, transfers or BPAY, as well as direct debit.
Is The Cheapest Gateway The Best?
Not always. A low rate on a transaction is easily negated by higher fraud losses, a lack of support, manual reconciliation or a poor integration with the platform. Factor in staff time and the cost of recovering a failed order to get the true total.
Make The Choice Fit
For an Australian online store the ideal gateway is one in step with the way the business intends to grow, how finance does its reconciling and the ordering habits of the customer. Build on what your buyers already know and put in place capability to overcome an obstacle.
Run the same practical tests on Stripe, GoCardless, Adyen, Worldpay, Braintree, PayPal, eWAY, Airwallex, CommBank Powerboard and BPAY. Provided the checkout is secure, the dollars are accounted for and the staff can tell you where the money is coming from, you are fine. If not, a cheerful dashboard is not going to put right what is wrong.
