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How to Select an International Payment Processor

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Finding the Right Solution Unique to Your Business

Meeting International Payment Standards

The payment processing requirements of an international eCommerce business are entirely different from that of a standard eCommerce business. Also, maybe more complicated. Since international eCommerce businesses involve different countries and regions, the payments come in different currencies. Moreover, other things get included in the amount, such as taxes, handling fees, customs, and duties, etc. Not to forget, there is a high likelihood of fraud with international transactions. Therefore, it is necessary to plan before choosing and setting up payment processors.

Suitable payment processors for different regions will ensure a robust verification process. It will enable seamless order fulfilment, or refund in the case the order gets cancelled or returned. So, we recommend you go through the different features each payment processor offers. Check if they provide service to different countries and can handle different currencies. Also, take into account the fee they will charge for processing the payments, as well as their terms and conditions.

Now, the terms can vary dramatically for every payment processing service. However, you can always negotiate the transaction fee, so it is more favorable to your business.

Incorporating Industry Best Practices

Fraud Prevention

Naturally, payment processors take on a lot of risks while dealing with international eCommerce transactions. International eCommerce is ripe with fraud. It is something they consider before partnering with a global eCommerce platform. A lot of the time, they even want to validate if you have a prevention system to reduce and eliminate fraud.

So, working on fraud prevention is also a part of the process. You need to make your site secure enough before enabling payment processing for an international location.

Ultimately, the first thing that we would recommend is conducting an audit of the different payment processors. Find out what their capabilities are within your eCommerce platform's targeted regions or countries.

Also, check if the payment processors offer any features for fraud prevention, such as address verification. After that, determine what you will need to set up as a configuration or a third-party service within your international eCommerce application.

Global-Friendly Features

The Flexibility of Your International eCommerce Solution

Another thing to consider before choosing a payment processor is whether your selected global eCommerce solution can handle such a task. Can it work with different payment processors within different regions? Will it ensure seamless transactions for the end-user? Ultimately, it all depends on the flexibility of your chosen eCommerce solution. It can work in your favor if you want to make any changes. For example, use a different payment processor, change the settings of the same payment processor, or use another version of their API for a different region. Moreover, your international eCommerce solution should also be capable of handling the different currencies and providing a different user experience depending on the country.

Multi-Faceted Strategy Approach

Payment Processing According to Region

Let's say; there is a particular region that is considered very low fraud. It makes payment processing a whole lot easier in that country. You can have simple device detection capabilities for that region. So, if someone tries to make a purchase using an unrecognized device, it requires multi-factor authentication. You can have some form of address verification as well.

However, maybe your international eCommerce platform also caters to a high fraud region. Then, a payment processor with an escrow can be beneficial. So, the user's money goes into the escrow. A third party takes the escrow fund. It generally has a built-in arbitration process in case there is any disagreement. So, it handles any challenge that might occur with the delivery or the quality of the items. Once the order is fulfilled, and the customer is satisfied, the escrow gets released.

Mostly, you end up with a thorough process where each step is verified. It can significantly help reduce any potential fraud. You will be able to cater to different levels of fraud in different regions.

Another thing you need to keep in mind is the user interface. So, you must consider if your international eCommerce platform can handle multiple payment processors in the necessary configuration settings. It should offer the capability to modify the user interface according to the region.

Verification & Reserve Funds

Pre-Authorization and Capture

The idea behind pre-authorization is that you can verify and reserve funds for some time. The capture occurs once the purchased item is successfully shipped to the user. Essentially, this is when the funds are transferred from the user's card to your bank account. When choosing payment processors for international eCommerce, check if they provide pre-authorization and capture.

There are a lot of challenges with shipping, customs, duties, inventory issues, etc. in international eCommerce. So, the estimated total could change based on a currency conversion or shipping costs, customs, and duties calculations being slightly off. Therefore, the pre-authorization is always some percent higher than the estimated total. However, make sure you notify the user beforehand.

How Clarity can Help

Clarity International eCommerce Experts

If you have any more questions related to this topic, we encourage you to reach out to our experienced team. They can provide a complimentary analysis. Or answer any questions about the next step in the process of expanding your eCommerce platform internationally. We certainly look forward to answering your question and talking with you about your upcoming international eCommerce project.

As you plan how to expand your eCommerce platform internationally, we encourage you to go through the resources below. Some of these can be helpful for your project.

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