Compare the Top 7 Payment Processing Companies and Services in UK | 2024

What are payment processing companies and services?

Payment processing companies handle financial transactions between merchants and customers. They sell a type of financial software that businesses use to accept and process payments.

If you’re a business owner, payment processing services help you accept payments from your customers in a variety of ways, including credit cards, debit cards, electronic checks and mobile payments.

As non-cash transactions in Europe are expected to skyrocket to 467 billion transactions by 2026, it’s more important than ever before to have secure, reliable payment processing software in place to accept cashless and online payments.  

This kind of software is used by businesses of all sizes; from small eCommerce businesses to large SaaS enterprises. The best providers save companies time and money by making it easier for customers to pay, automating the payment process and reducing the risk of fraud. 

How do payment processing systems work?

Payment processing systems work by transferring funds from a customer to a merchant when a product or service is purchased.

Payment processors act as a middleman between card networks, banks and the merchant, passing on information from your customer’s card to your bank and the customer’s bank so that funds can be settled.

Sophisticated software is used by payment processing service providers like Airwallex to securely collect and transmit customers’ financial information. These payment gateways are usually hosted in the cloud and enable secure digital payments, meaning you don’t have to invest in additional security or compliance software.

The process of transferring funds from buyer to seller involves several steps:

• Payment is initiated: the customer decides to purchase and provides their payment details via credit or debit card, bank account, digital wallet or mobile payment platform like Apple Pay. This often includes security measures like encryption at the point of entry to protect data.

• Payment gateway: the payment information is securely transmitted via a payment gateway to the payment processor. Advanced encryption and tokenisation should be used to ensure compliance with PCI DSS standards and safeguard the customer's financial information.

• Payment processor: the processor verifies the transaction details with the customer's bank (issuing bank) and the merchant's bank (acquiring bank). Fraud detection algorithms reduce the risk of unauthorised charges.

• Card network: If a card is used, the card network will facilitate the authorisation messaging between the merchant's bank and issuing bank.

• Authorisation: the issuing bank checks the transaction for authenticity and confirms if there are sufficient funds or credit available. This stage may involve additional security checks, such as two factor authentication.

• Approval and settlement: once approved, the transaction is processed. Funds are settled (depending on the size of purchase and processor, this can be instant or take a few days) and move from the customer's bank to the merchant's account.

• Currency conversion: if it’s an international payment, the payment processor should be able to handle transactions in multiple currencies and automatically convert funds as required.

• Confirmation: both the merchant and customer receive confirmation of the transaction's approval or decline.

Top payment processing companies in 2024

In no particular order.

• Airwallex facilitates global payments and currency exchange for businesses.

• Adyen provides a unified commerce platform for accepting payments anywhere.

• PayPal enables secure online money transfers and payment processing.

• Revolut Business offers multi-currency accounts with easy international payments.

• Shopify includes built-in payment processing with Shopify Payments.

• Square provides point-of-sale and payment processing solutions for businesses.

• Stripe offers a comprehensive suite for online payment processing and financial services.

Top features to look for in payment processing software

Choosing the right payment processing software can be a business critical decision. The best providers are easy to use, secure and flexible. Here are the top features to look out for:

• Ease of use: look for a platform that is easy to navigate for you and your customers. The best providers centralise all the information you need into one simplified dashboard.

• Integration capabilities: your provider should integrate easily (no code required) with other business systems like your accounting software or eCommerce platform.

• Security: offering secure payment acceptance will help protect funds and data. Look for a provider that is PCI DSS compliant and has fraud prevention systems in place.

• Cost: fee structure and length of contract differs between providers, so read the small print. Don’t forget about hidden fees when collecting money in multiple currencies; this can really affect the profit margins from international revenue.

• Customer management: some solutions can help you understand, engage and retain your customers. Look for tools with information storage, personalised communication options and advanced reporting capabilities. 

• Analytics: software with billing analytics that deep dive your MRR and revenue forecast can help you manage funds better.

Compare the top payment processing companies in 2024

In alphabetical order.

What questions should you ask when onboarding a payment processing company?

Before jumping in with a payment processing company, it’s important you understand the payment processing system you’ve chosen and whether it’s right for your business’ operational needs, budget and growth plans.

Asking the right questions will help you build a clear picture of what to expect. We've provided 10 common questions which will should provide the information to make an informed decision:

1. What are your transaction fees? Ask your potential new provider about all possible fees, including transaction fees, monthly fees, setup fees, conversion fees and any hidden charges. Knowing exactly what you’ll be paying for each transaction and any additional costs can help you budget more effectively. For example, at Airwallex, businesses often ask us to forecast costs.

2. Are there any long-term contracts or early termination fees? Some providers may require you to commit to a long-term contract, which could include early termination fees if you decide to switch providers.

3. What types of payments can you process? Ensure the provider can process all the payment types your business requires, including international payments. This is particularly important if you operate globally or plan to expand.

4. How long does it take for funds to be settled? The settlement period can impact your cash flow, so ask how long it typically takes for funds from transactions to be deposited into your account.

5. What security measures and compliance standards do you have in place? Every time you take a credit card payment, you’re handling sensitive financial information. Ask about the provider’s security policy, protocols, fraud prevention measures, authorisation rates and compliance with standards like PCI DSS to protect your customers' data. After all, a poor payment experience may damage your brand reputation.

6. Is your system compatible with our current business software? Seamless integration with your existing business software, such as your eCommerce platform, accounting software or CRM system, is essential for efficient payment and streamlined operations.

7. What level of customer support do you offer? Good customer support can make all the difference when dealing with payment issues. Ask what type of support is available (bots or agents, email or phone), about the availability of support and the response times.

8. Can you handle multi-currency transactions? If you accept payments from customers in different countries, you’ll need to know if the provider supports multi-currency transactions and what the fees are for currency conversion. Lots of providers charge unnecessary fees, whether it’s foreign transaction fees on cards, forced conversion fees or high FX rates.

9. What is your policy on chargebacks? Understanding the provider’s process for dealing with chargebacks and whether they offer any support or protection can save you money in the future.

10. Do you offer any value-added services? Some providers offer additional services like analytics, reporting tools or marketing insights. Knowing what’s available can help you get the most out of your payment processing solution.

Why choose Airwallex for payment processing service? 

Airwallex is best known for its global reach. If you operate across borders or in multiple currencies and you’re looking for a reliable payments processing provider to help you save time and money, Airwallex is hard to beat.

We help businesses slash finance team admin hours, offer seamless customer and supplier payments and save on foreign transaction fees.

Here’s why Airwallex stands out: 

• Easy to use: one centralised dashboard that’s easy to navigate. No third parties to deal with.

• Automated: programmed payment collection that saves you time, improves cash flow and avoids wasted hours chasing late payments.

• Global reach, local experience: process your payments in 170+ currencies with local payment methods that cater to your customers’ preferences. Set up multi-currency accounts with local bank details.

• eCommerce integration: plugin seamlessly with platforms like Shopify, WooCommerce and Magento to accept customer payments from 180+ countries.

• Eliminate costly FX fees: maximise revenue with like-for-like currency settlement and avoid forced auto-conversion.

• Human support: a dedicated service team ready to help resolve any issues quickly (without bots).

• Safe and reliable: From best-in-class payment acceptance, safeguarded funds and fraud protection that’s PCI DSS compliant. 

Airwallex supports a range of organisations to process one-time and recurring payments, from eCommerce stores to subscription businesses and online marketplaces. Our payments processing platform is designed to help you grow and safeguard your global revenue.

FAQs about payment processing systems

What is payment processing software?

Any programme that helps businesses accept online payments. These tools are usually cloud-based and send financial information from your customer’s card to your bank and the customer’s bank. 

What important factors to choose when selecting a payment processing solution?

There are lots of factors worth considering, including security credentials, cost, flexibility, which payment methods are supported, integration capabilities and how easy it is to use.

How much does it cost to onboard a payment processing software?

Pricing varies between providers and the type of transaction. Some offer subscription plans, while others operate on a flat-rate model. Don’t forget there are often hidden fees for international payments. 

How safe are payment processing services?

Secure payment processing software should include fraud prevention systems, end-to-end data encryption and be compliant with PCI DSS (the global security standard for organisations that store and process sensitive data).

Sources & References

² https://www.adyen.com/en_GB/pricing

³ https://www.paypal.com/uk/webapps/mpp/merchant-fees

⁴ https://www.shopify.com/uk/pricing

⁵ https://squareup.com/gb/en/pricing

⁶ https://stripe.com/gb/pricing

⁷ https://www.revolut.com/business/business-account-plans/

Disclaimer:  We wrote this article in Q1 2024. The information was based on our own online research and we were not able to manually test each tool or provider. The information is provided for educational purposes only and a reader should consider the specific requirements of their business when evaluating providers. If you would like to request an update, feel free to contact us at [email protected].

Related articles about payment services and solutions:

• Top Payment Gateway Providers & Services in the UK

• Top eCommerce Payment Systems & Solutions in the UK

• Top Online Payment Systems & Providers in the UK

• Top Digital Payment systems & Solutions in the UK