Choosing the Best Payment Gateway for UK-Based SMEs in 2023

From eCommerce to SaaS to subscription boxes, the subscription market is booming in the United Kingdom. The Brits spend £2 billion every year on subscription services. In the last few years, the subscription market has seen amazing growth and is estimated to grow 72% more in the coming three years. According to the most recent Barclaycard data, the subscription economy surged by 39.4% year on year in July and is now worth £323 million.

The growing subscription market makes the United Kingdom one of the most thriving subscription society. The increasing demand for subscription services increases the density of the online payment market as well.

To accept online recurring payments, businesses are looking for options that can serve them the maximum payment options in multiple currencies and cater to several types of companies. So, if you’re looking for the best payment gateway for UK-based SMEs and Startups, keep reading!

How to Accept Online Recurring Payments for Subscription Services?

Receiving online recurring payments requires subscription merchants or SaaS vendors to integrate a payment gateway for secure and efficient online payments from customers every time and anytime from anywhere.

The payment gateways have the most significant role to play in the system of online payment processing. They are used to provide safe, seamless, and reliable payment processing experiences over the internet using digital devices only.

Payment gateway integration connects your online payment cart to payment processors, card payment networks, and issuing banks through websites, apps, and other applications like virtual terminal and POS, etc.

The payment gateways process payment information for the transaction to the acquiring banks. From there, they approach the card payment service providers and let the merchants know if the payment is accepted or rejected. When the payments are processed successfully, the funds are routed to the merchant’s account and finally settled into the business bank account after the completion of the transaction.

The Top Payment Gateways in UK – A Comparison

In the United Kingdom as well as the European Union, digital security is one of the prime concerns of the merchant as well as the customer. This is why it is viable for any subscription services provider to offer their customers the best and most secure payment gateway options available in the UK.

top payment gateways in UK

This article aims to provide you in-depth analysis of the most popular payment gateways used in the UK. Here is an analysis of our top picks of the top payment gateways UK has to offer:

Worldpay

Worldpay is the leading payment gateway used in the United Kingdom. It is a powerful payment processing solution for businesses from across the industries and regions of the UK. It originated in the United States and is available in more than 40 countries.

Worldpay handles more than 40% of all online card processing and has emerged as the top payment processing company in the United Kingdom. The gateway leads the race of the online payment gateways options available in the United Kingdom because it accepts payments in more than 120 currencies and offers support to a wide range of options including card payments, alternative payments, integrated point-of-sale, mobile & tablet point-of-sale, virtual terminal, recurring payments, hosted payment pages, shopping carts, and multi-channel payments.

Worldpay offers two ways to accept recurring payments online:

Via Online Merchant Account is the transfer of recurring payments directly into the account, which they will then settle into your bank account.
Via Pay-By-Link is a secure online recurring payment processor without needing a website.

Pros

Supported Payment Methods: It supports all the major payment options including MasterCard, Visa, American Express, Discover, UnionPay, and Diner’s Club credit and debit cards, PayPal, e-checks, and alternate payment methods (APMs) like ApplePay, Google Pay, and more.

Security: It is a PCI-DSS-compliant payment gateway with exceptional security measures, encryption, tokenization, and EMV. The fraud prevention tools of WorldPay alert against any suspicious activity and prevent any attempt for a fraudulent transaction.

Payouts: WorldPay transfers funds to your bank account twice a week.

Plans: Flexible plans with:

Pay as you go.
Pay monthly.

Cons

Hidden and Complex Pricing: Worldpay pricing structure is quite complex and concealed and requires contact to understand the actual pricing.

PayPal

PayPal is the pioneer of payment gateways and continues to be the most well-known payment gateway across the globe. It is still the leading payment processing services provider, not only in the United States, United Kingdom, Europe, Canada, and Australia but all over the world.

Each day PayPal processes more than USD7.6 billion from more than 227 million accounts. PayPal is also a leading choice of small-scale merchants as it facilitates them with aggregate accounts so they can easily start receiving money into their accounts.

According to PayPal, more than 20 million consumers in the UK use PayPal each year UK for their online funds transfer.

Pros

Supported Payment Methods: PayPal supports all the major credit/debit cards, all types of PayPal accounts, Android Pay, Apple Pay, and Bitcoin.

Security: In addition to the enhanced PCI-DSS compliance with the customers, it also offers PayPal buyer protection.

Payouts: PayPal payouts in 24 hours only however it may take up to a week or more depending on the banking and clearing process.

Plans: PayPal offers two basic plans:

Pay in 4 (pay in four instalments)
Monthly Payment Plans (6, 12, and 24-month periods)

Easy Account Support: With PayPal, merchants can instantly create an account and start receiving payments in 24 to 48 hrs.

Cons

Pricing: PayPal is expensive and charges more transaction fees than its contemporaries.

Limited e-Wallet Payment Options: With PayPal, merchants can receive online recurring payments from PayPal only. It does not offer support to other digital wallets as they all have the same payment processing system. Through it supports mobile payments and crypto wallets for Bitcoin.

Fewer Options for Currencies and Regions: PayPal allows merchants to receive payments in major 24 currencies only. It also is not available in new growing subscription markets in South Asia, South East Asia, East and West Africa, and some other regions.

READ MORE: Payment Wars 1.0: Stripe vs PayPal

Stripe

Stripe is gaining popularity in the UK and is emerging as the third-most integrated payment gateway option in the UK for online recurring payments processing. Due to the following key reasons, it has become the ultimate choice for UK subscription-based small- to large-scale businesses to use Stripe as their chief payment gateway:

Supports almost all payment options including direct debits.
Offers payment processing in more than 135 currencies from almost all across the world.
Highly secured payment gateway against online payment fraud detection and mitigation
Stripe can be used to accept several debit/credit cards for international payments.
It offers instant transfer to the main account against a fee of 1% of the amount transferred.

Pros

Supported Payment Methods: It accepts payments from all the leading credit cards and mobile wallets like Android Pay, Apple Pay, 3D Secure, ACH, Google Pay, AliPay, and others.

Security: Stripe encrypts and flows the information into its dedicated vault. With Rada, the trademark anti-fraud system of Stripe that combines machine learning with a customizable ruleset to secure sensitive data with the features like encryption and tokenization offers an extra layer of security.

Fee: The primary version of Stripe is free. With Stripe, you are not bound by the contracts and can terminate the association at any point.

Cons

Payouts: For most countries, Stripe payouts are processed in max 7 days.

Not Very User-Friendly: Stripe is a technically rich platform hence making it a bit difficult platform for non-technical users to integrate and operate. However, they offer extensive knowledgebase.

Higher Card Transaction Pricing: Stripe charges more transaction fees than most of their alternatives for debit and other non-European cards.

Longer Account Approval Timing: Stripe requires a lot of documentation and background checking thus requiring more time for merchant account approval.

Adyen

Adyen is one of the oldest and popular choices of payment gateway for mid-size to larger businesses with a higher volume of transactions in the UK and neighboring European regions. Adyen is equipped with highly advanced risk management tools. It ensures the encryption of sensitive data and also is known for revenue optimization tools.

Pros

Fee: With no setup or any other surprise fee, Adyen charges a set percentage for Visa and MasterCard whereas it charges a different percentage for SEPA Direct Debit.

Built-In Currency Conversion: Adyen offers built-in currency conversion and on its basis charges a processing fee plus a payment method fee per transaction.

Customer Support: Adyen provides 24/7/365 support to its customers with dedicated managers for each account. They also provide extensive knowledgebase and guides for instant help.

Cons

Dedicated to Bigger Merchants: Adyen is not a stellar payment processing solution for small scale businesses.

Slower Payouts: Adyen settles funds to merchant account twice a week, only.

Also Read: What Are the Online Payment Methods for Automated Recurring Payment Processing and How Do They Work?

Authorize.Net

Authorize.Net is a leading payment services provider all over the world and currently catering to more than 400, 000 merchants worldwide. It offers two ways for UK-based merchants to accept recurring payments—either via payment gateway plus merchant account or by integrating payment gateway only.

Pros

Supported Payment Methods: It caters to almost all the leading payment methods for card payment, e-checks, and alternate payment methods, including Visa, MasterCard, Discover, American Express, JCB, PayPal, Visa SRC, Apple Pay, Chase Pay, E-check, etc.

Security: Authorize.Net is also a PCI-DSS Compliant payment gateway with its robust free fraud detection and prevention suite

Payouts: Authorize.Net takes 24 hours to settle the transactions and the merchant can get a hold of funds after then.

Fee: Authorize.net charges a setup fee and a monthly gateway fee along with a standard transaction fee. For international transactions, it also charges an additional percentage.

Cons

Monthly Fee: Authorize.Net charges a monthly fee in addition to the extra £15 per month for extra currencies beyond GBP.

Amazon Pay

Amazon account is one of the most interesting and proliferating modes of online payment in the UK. As a flagship service of Amazon Web Services (AWS), it is a leading mobile payment wallet. The merchants can use Amazon Pay merchant services to receive payments from customers through their Amazon accounts.

Pros

Supported Payment Methods: With Amazon Pay, payments can be received from credit and debit card payments along with other Amazon accounts for selected merchants.

Security: PCI-DSS Compliant along with TLS/SSL with 128-bit encryption for login security.

Payouts: Amazon Pay deposits funds into the merchant account on the next scheduled settlement date right after capturing payment, automatically.

Cons

Fee: In addition to a processing fee, Amazon Pay also charges an authorization fee.

Chargeback Dispute Fee: It also slaps the merchant account a set amount (excluding VAT) for any chargeback.

Cardstream

Cardstream is a leading payment gateway provider that offers secure and efficient online payment solutions to businesses of all sizes. With a reputation for reliability and innovation, Cardstream enables merchants to accept a wide range of payment methods, including credit and debit cards, digital wallets, and alternative payment options.

Their user-friendly platform ensures a seamless checkout experience for customers, while robust fraud prevention tools and advanced security measures protect both buyers and sellers from potential risks. Whether operating in e-commerce, retail, or any other industry, businesses can rely on Cardstream to streamline their payment processes, enhance customer satisfaction, and drive growth through their comprehensive and customizable payment solutions.

Pros

Supported payment methods: Cardstream include major credit and debit cards such as Visa, Mastercard, American Express, Discover, and Diners Club. Additionally, Cardstream typically provides integration options for popular digital wallets like Apple Pay and Google Pay, offering customers convenient and secure payment options.

Security: It is PCI DSS compliant and offers encryption for secure data transmission.

Payouts: Payouts take 1-7 business days depending on the mode and region of transaction.

Cons

Limited integration options: It’s not as widely supported or integrated with certain e-commerce platforms compared to some other payment gateway providers. While Cardstream offers a range of payment solutions and security features, merchants might find that it has limited compatibility with specific e-commerce platforms or third-party applications they wish to use.

Opayo

Opayo, formerly known as Sage Pay, is a leading payment service provider that has been gaining popularity in the UK due to its comprehensive and secure payment solutions. Catering to businesses of all scales, Opayo offers a wide array of services, including online payment processing, e-commerce integration, and fraud prevention tools.

With a strong focus on data security and compliance, Opayo ensures that sensitive customer information is safeguarded through rigorous encryption and adherence to industry standards. This level of trustworthiness has attracted a growing number of businesses seeking reliable and compliant payment solutions in an increasingly digital landscape.

Their dedicated customer support team provides quick assistance and resolves any queries promptly, further enhancing the overall experience for businesses. As a result, Opayo has earned the trust and preference of a wide range of UK merchants, from small startups to established enterprises, as they continue to expand their offerings and solidify their position as a leading payment service provider in the region.

Pros

Supported payment methods: Opayo supports major credit and debit cards, digital wallets like Apple Pay and Google Pay, and various region-specific alternative payment methods such as iDEAL and SOFORT. They also offer integration with PayPal and typically support multiple currencies, making it convenient for businesses to accept payments from customers worldwide. Additionally, Opayo may provide options for subscription payments, allowing merchants to set up and manage recurring billing for subscription-based services or products.

Security: Opayo’s security policy likely includes PCI DSS compliance, encryption for data transmission, tokenization for sensitive data protection, fraud detection measures, secure data centre hosting, regular security audits, and adherence to industry regulations and certifications.

Payouts: The processing time for payouts with Opayo can vary based on the merchant’s specific account settings and region. Typically, Opayo processes payouts within 2 to 7 business days from the time of the transaction.

Cons

Higher fees: Opayo has higher transaction fees compared to most other payment gateway providers.

Shopify Payments

Shopify Payments is an integrated payment solution offered by Shopify, one of the world’s most popular e-commerce platforms. Designed to simplify the payment process for online businesses, Shopify Payments allows merchants to accept various payment methods directly through their Shopify store, eliminating the need for third-party payment gateways.

With a seamless setup and a straightforward fee structure, merchants can easily manage their finances and sales data within the Shopify dashboard. The platform also offers advanced fraud detection tools and secure transactions, ensuring a safe and trustworthy experience for both merchants and customers.

As a result of its convenience, reliability, and efficiency, Shopify Payments has become increasingly popular as a payment getaway in UK. Its rising popularity in the UK can also be attributed to the comprehensive ecosystem offered by Shopify.

Moreover, Shopify continuously enhances its services with updates and new features, staying at the forefront of the e-commerce industry. This dedication to innovation and the provision of a user-friendly, end-to-end solution has contributed to the widespread adoption of Shopify Payments by small businesses.

Pros

Supported payment methods: It supports major credit and debit cards, Apple Pay, Google Pay, PayPal, Klarna (in certain regions), and other region-specific payment methods like iDEAL and SOFORT.

Security: Shopify payments is PCI DSS Level1 certified and it uses SSL encrypted payment transactions. It also provides 3D security through authentication codes.

Payouts: Shopify Payments typically processes payouts within 3 business days. However, the exact payout timing may vary depending on the country and region where the merchant’s store is located.

Cons

Limited regions: One potential downside of using Shopify Payments is that it is not available in all countries or regions.

Final Word

All the payment gateways mentioned here have promising qualities, however, the title of the best payment gateway completely depends on your needs. Albeit, we have assigned verdicts to the best aspects of each platform mentioned in this list to help you select the most suitable gateway for UK-based business.