Payment gateways in Australia: How to choose the right one for your business

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  1. Introduction
  2. What are payment gateways?
  3. How payment gateways fit into Australia’s payment processing landscape
  4. How to choose a payment gateway in Australia
  5. How to integrate payment gateways for Australian businesses
  6. Stripe payment gateway in Australia

Online payments are a major part of Australia’s payments environment. And for businesses that want to get set up online, understanding how to accept these payments is key. The total value of the Australian payments market is expected to increase from $920 billion in 2024 to $1.97 trillion by 2029, according to a report from Mordor Intelligence. Accessing this market means making it possible for customers to conduct easy and secure transactions worldwide, whether they’re in Perth or Paris.

Below, we’ll walk through the role payment gateways play, how they fit into Australia’s payment processing landscape, and what to look for when choosing the best payment gateway for your business. With the right planning and due diligence, you can give your customers a smooth and easy checkout experience.

What’s in this article?

  • What are payment gateways?
  • How payment gateways fit into Australia’s payment processing landscape
  • How to choose a payment gateway in Australia
  • How to integrate payment gateways for Australian businesses
  • Stripe payment gateway in Australia

What are payment gateways?

A payment gateway facilitates the transfer of information between a payment portal, such as a website, and the front-end processor or acquiring bank. When a customer pays for a product or service online with a credit or debit card, the payment gateway performs several tasks to process the transaction, including authenticating the transaction, authorizing the payment, and allowing the business and customer to complete the sale and purchase.
The payment gateway encrypts the card details, ensuring sensitive information is passed securely from the customer to the business and then between the business and the bank. Payment gateways are a key component of the online sales process.

How payment gateways fit into Australia’s payment processing landscape

Australia’s payment ecosystem is characterized by its adherence to stringent financial regulations and compliance with international security standards, such as Payment Card Industry Data Security Standard (PCI DSS). As in many other countries, including the United States, these regulations and standards ensure payment processors in Australia maintain a high level of data security. Payment gateways in Australia must comply with several systems and laws, including:

  • New Payments Platform (NPP): Australia is home to the NPP, a national infrastructure for fast, flexible, and data-rich payments. Payment gateways in Australia integrate with systems such as NPP to provide instant bank transfers, a payment method popular with customers and businesses.

  • Australian Consumer Law (ACL): Australian payment gateways must comply with the ACL by providing transparent fee structures and protecting customer rights during online transactions. They also must work within the guidelines set by the Australian Prudential Regulation Authority (APRA), which oversees financial institutions and financial system stability in Australia.

  • Buy now, pay later (BNPL): Many Australian payment gateways support BNPL services, which have surged in popularity in the Australian market. Often, payment gateways integrate services such as Afterpay and Zip, giving customers the option to defer payments or pay in installments.

  • Australian Taxation Office (ATO): The ATO has regulations in place that affect payment gateways. Payment gateways must provide mechanisms for businesses to easily collect and remit the goods and services tax (GST) on online sales.

  • Reserve Bank of Australia (RBA): The RBA plays a role in the payment system, especially in promoting competition and innovation in the payment services market. This includes overseeing the practices and fees associated with payment gateways.

  • Mobile payments: With the rise of mobile commerce, Australian payment gateways are offering more mobile-optimized payment solutions. This ensures payment gateways are mobile-friendly and integrate with digital wallets and payment systems such as Apple Pay and Google Pay, which are widely used in Australia.

How to choose a payment gateway in Australia

Choosing a payment gateway for your Australian business is about making strategic choices that match your business objectives and operational needs. From preserving smooth financial transactions to abiding by regulatory requirements, each decision will directly affect your sales process and customer satisfaction.

Below are a few considerations to guide you in selecting a payment gateway that fits your business model:

  • Assess currency-handling capabilities: A payment gateway must handle the Australian dollar for local transactions and facilitate currency exchange for international transactions. This dual capability allows businesses to operate smoothly within the domestic market and expand their reach to customers globally without facing prohibitive transaction costs. Gateways capable of managing currency conversions can simplify financial operations for businesses that engage in cross-border commerce.

  • Check integration with local payment systems: A gateway’s integration with Australian banks and the NPP can dictate the speed and reliability of transactions. The integration with NPP, in particular, allows for real-time bank transfers, which an increasing number of Australian customers prefer. This direct collaboration with the financial infrastructure can expedite payment processing, a feature that businesses and customers value.

  • Verify regulatory compliance: The ability to operate within the financial regulations of Australia, including standards set by APRA and compliance with an Australian Finance Services License (AFSL), is mandatory for any payment gateway. Complying with these regulations ensures the gateway is trustworthy and its operations support the stability of the overall financial system.

  • Compare different providers’ fee structures: To assess the cost-effectiveness of a payment gateway for a particular business, it’s important to understand the fee structure. A gateway that offers a straightforward fee schedule for transactions and any monthly service fees provides businesses with predictable costs, helping with financial planning and budgeting. The right fee structure can be a decisive factor for businesses when balancing gateway services with operational costs.

  • Prioritize responsive customer support: Access to responsive customer support (specifically support that operates within Australian business hours) is indispensable. A gateway that provides prompt assistance—and the means with which to resolve payment issues swiftly—minimizes downtime and helps maintain a business’s reputation for reliability.

  • Investigate ecommerce platform integration: A gateway that offers hassle-free setup and a variety of plugins for popular ecommerce software platforms allows businesses to integrate payment processing with minimal technical effort. Straightforward integration reduces the resource investment required to get the payment system up and running.

  • Demand high security measures: Advanced security measures and compliance with PCI DSS are key to a payment gateway’s operations. These security protocols safeguard against the unauthorized use of customer information and ensure all transactions are processed in a protected environment. A gateway’s commitment to maintaining high security standards instills confidence in businesses and customers.

  • Be ready for mobile commerce: With the prevalence of mobile devices in Australia, a gateway’s ability to provide a smooth payment process on mobile platforms is important. Integration with popular mobile wallets and payment systems is also a key feature that caters to the preferences of the growing mobile customer base.

How to integrate payment gateways for Australian businesses

Integrating a payment gateway for an Australian business requires marrying technical precision and compliance with local financial standards. Here’s a look at the process:

  • Select a compatible payment gateway: Evaluate gateways that have the capabilities to facilitate local transactions and those that use international currencies, through comprehensive transaction methods such as direct bank transfers enabled by the NPP.

  • Examine compliance requirements: Rigorously assess the gateway’s compliance with Australian financial governance, including APRA standards, AFSL requirements, and PCI DSS compliance for API integrations.

  • Plan for GST and reporting: Choose a system for managing the complexities of GST collection and providing nuanced reporting options that promote compliance with the ATO’s regulations.

  • Check for technical compatibility: Choose a gateway with a swift onboarding process, user-friendly technical documentation, and sandbox environment for testing, including software development kits (SDKs) for custom development and easy integration with your ecommerce infrastructure.

  • Test the payment process: Conduct thorough testing within the gateway’s sandbox environment to check the system’s reliability before it goes live.

  • Deploy and monitor: After deployment, monitor the gateway’s performance and assess its transaction handling and responsiveness to any issues. Make sure you have a dedicated support team to manage potential disruptions.

Adhering to this integration process ensures the payment gateway is attuned to the specifics of the Australian financial system and the operational demands of your business—guaranteeing a reliable and compliant online transaction process.

Stripe payment gateway in Australia

Stripe provides a suite of commerce solutions for Australian businesses, including the ability to accept various forms of payment online and in person. Stripe’s services in Australia are designed to cater to the needs of a diverse range of businesses, from small startups to large corporations, and support the country’s growing ecommerce environment.

Here are Stripe’s payment gateway costs for businesses in Australia:

  • For domestic cards: 1.75% + A$0.30 per transaction
  • For international cards: 3.5% + A$0.30 per transaction

These rates apply to payment processing and are part of Stripe’s pay-as-you-go pricing model for payment platform services. There are no setup fees, monthly fees, or hidden fees associated with these costs. For more details and to see whether there are any updates or changes to these costs, look at Stripe’s pricing specifics.

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