In the evolving landscape of e-commerce payment solutions, small andmedium ecommerce businesses must navigate a maze of fees and pricing structures to find the most cost-effective solution for their needs. This article provides a straightforward comparison between two prominent payment service providers, Payone and Adyen, based solely on their publicly advertised website pricing.
We will delve into the costs associated with accepting Visa, Mastercard, and Alipay, evaluating both the setup fees and ongoing monthly charges. By focusing on these key elements, we aim to shed light on how each provider’s pricing structure could impact a small retailer’s bottom line. This comparison is crucial for understanding not only the initial investment required to start processing payments but also the recurring costs that will influence the overall expense of maintaining an online store. Links to the raw data are provided at the bottom of this article.
These smaller retailers are particularly vulnerable to what the advertising industry refers to as “rate card fees.” Worldline entity Payone offers a comprehensive range of services, but at what cost? This article examines the initial and ongoing expenses for a small business looking to accept Visa, Mastercard, and Alipay. We will also look at the set up costs for the aforementioned brands as well as American Express and Giropay through Payone.
Initial Outlay with Payone (pricing published July 2024)
For a small business, setting up with Payone involves several initial costs. These include Payone set up fees:
- Account Setup (Account Connect): €199.00
- Visa/Mastercard Setup: €49.00
- American Express Setup: €99.00
- Alipay Setup: €49.00
Adyen has no set up fees related to their ecommerce nor do they have rolling monthly fees
Total Initial Setup Cost based on assumption of the Visa, Mastercard, American Express and Alipay brands: €396.00
When evaluating Account Setup Costs, Payone’s fees are notably higher than its competitors. Unzer charges €149 for a similar setup (all in on package), while Adyen has no setup fees at all. Unzer’s website lacks detailed information on setup costs per payment brand and requires customers to fill out a form for specifics, whereas both Adyen and Payone’s websites are transparent with their pricing. Payone provides a comprehensive six-page pricing schedule (downloadable Schedule of Pricing) that meticulously outlines all potential fees. While this level of detail demonstrates a strong commitment to transparency, the sheer volume of costs permutations may be daunting for small businesses.
Monthly Fixed Fees
Once the initial setup is completed, our small family-owned retailer will face several fixed monthly fees according to Payone’s pricing schedule:
- Visa/Mastercard Monthly Fee: €10
- American Express Monthly Fee: €19
- Alipay Monthly Fee: €10.00
- Giropay Monthly Fee: €10.00
Total Monthly Fixed Fees: €49.00
These recurring costs are crucial for small businesses to consider, as they will impact the overall profitability and do not even take into account their monthly transaction fees.
Monthly Variable Costs: Best Practice Representation
While specific transaction volumes and card mix distributions remain indeterminate, it is feasible to illustrate potential costs through the application of reasonable assumptions. Given the transparency provided on the official websites of both Adyen and Payone, we shall proceed with a comparative analysis of their pricing structures, focusing on their respective offerings within the German market.
Payone / Adyen – Transaction fees per Alipay and Visa/Mastercard brands:
1. Alipay Transactions
Assumptions:
- Number of Alipay Transactions per Month: 100
- Average Transaction Value: €50
- Total Monthly Alipay Transaction Volume: €5,000
Payone Alipay Costs:
- Blended Fee (Disagio fee) (2.85%): €142.50
- Monthly Fee: €10.00
Total Monthly Alipay Cost (excluding setup): €152.50
Adyen Alipay Costs:
- Fixed Percentage Fee per transaction (3%): €150.00
- Fixed Fee (€0.11 per transaction): €11.00
Total Monthly Alipay Cost (zero set up charge) : €161.00
Alipay Cost Comparison:
- Payone Monthly Cost: €152.50
- Adyen Monthly Cost: €161.00
- Percentage Difference: Adyen ends up being 5.57% more expensive than Payone for Alipay with the additional €10.00 monthly charge factored into Payone’s total cost.
2. Visa/Mastercard Transactions
Assumptions:
- Number of Transactions per Month: 500
- Average Transaction Value: €50
- Total Monthly Average Transaction Value: €25,000
Payone Costs:
- Disagio Fee (1.49% min 0.05): €372.50
- Monthly Fee: €10
Total Monthly Cost (excluding setup): €382.40 (including monthly rolling fee)
Adyen Costs:
- Interchange Fee (0.35%): €87.50
- Acquirer Fee (0.60%): €150.00
- Assumed Scheme Fee (0.125%): €31.25
- Fixed Fee (€0.11 per transaction): €55.00
Total Monthly Cost: €323.75
Cost Comparison:
- Payone Monthly Cost: €382.40
- Adyen Monthly Cost: €323.75
- Percentage Difference: Adyen wins the Visa and Mastercard battle with a total monthly cost of €323.75 compared to Payone’s €382.40, making Adyen 18.12% cheaper.
IMPORTANT NOTE:
In the first year, including initial setup costs, Payone’s total Visa and Mastercard costs amount to €382.40 (monthly costs) + €49.00 (setup) = €431.40. Adyen’s total is €323.75 (monthly costs) + €0 (setup) = €323.75. Adyen saves €107.65 compared to Payone, making Adyen 25% cheaper in total for Visa and Mastercard processing over the first year.
SUMMARY
The Financial Impact of Choosing Payone over Adyen based on advertised Ecommerce fees
For a small family-owned retailer evaluating ecommerce payment processing costs for Visa, Mastercard, and potentially Alipay, the first-year expenses show clear differences between Payone and Adyen. For Visa and Mastercard alone, Payone’s total cost, including the initial setup fee, is €4,589.80, while Adyen’s cost is €3,885.00, making Adyen €704.80 cheaper, or about 15.5% less expensive.
When considering Alipay, Payone’s total cost is €152.50 per month, amounting to €1,830.00 annually, while Adyen’s cost for Alipay is €161.00 per month, totaling €1,932.00 annually. Thus, Payone is €102.00 cheaper for Alipay, or about 5.3% less expensive annually.
Combining Visa, Mastercard, and Alipay costs, Payone’s total first-year expense is €6,419.80, while Adyen’s is €5,817.00. This results in Adyen being €602.80 cheaper, or about 9.4% less expensive overall.
Payone’s notably higher fees are chiefly due to their substantial setup fees, which can significantly impact the overall expense for small businesses. This cost structure, while transparent, often overshadows the potential benefits of their service offerings.
Setup costs in the payment processing industry often raise skepticism due to their ambiguous nature and the lack of clarity around what they truly encompass. These fees can appear as a hidden obstacle, with companies presenting them as necessary for “account initiation” or “integration,” but the exact value and necessity of these charges can be questionable. For many small businesses, the justification for such costs is unclear, especially when they are faced with additional, ongoing fees. The high setup costs advertised by firms across various sectors might just be more about securing a higher initial revenue stream than genuinely covering necessary expenses for service provision. This lack of transparency can lead to confusion and frustration, making it difficult for retailers to assess whether these fees are justifiable or merely an industry norm that benefits the service providers more than the businesses they aim to serve.
In contrast, many competitors do not disclose detailed pricing upfront and only provide fee information upon direct contact, which can be frustrating for small retailers seeking to understand costs without engaging in prolonged discussions.
Adyen, however, distinguishes itself by not only providing clear and detailed pricing but also utilizing an interactive web form to generate tailored quotes based on anticipated transaction volumes. This innovative approach enhances transparency and allows retailers to gain a more accurate understanding of their potential costs without needing to initiate contact. Adyen’s use of such digital tools reflects a commendable effort to simplify the process of obtaining pricing information, which makes for exciting “wait and see” as AI and other technologies advance.
Payone Ecommerce List of Prices and Services E-Commerce
Adyen Pricing – https://www.adyen.com/en_GB/pricing
Disclaimer
This article is presented in the public interest to offer a comparative analysis of payment processing costs for small businesses, particularly those unfamiliar with the payment processing sector. All data utilised in this article has been sourced from publicly available information on the official websites of Payone GmbH, Unzer, and Adyen, specifically:
- Payone GmbH: www.payone.com
(see Schedule of Pricing PAYONE_PLV_E-COM_2024-07_EN)
- Unzer: www.unzer.com
- Adyen: www.adyen.com
The content of this article reflects information that is already in the public domain and has been provided by the respective companies for public review. Consequently, no confidential or proprietary information has been disclosed.
The author, who is an expert in the payment industry and a former employee of Payone GmbH, has made every effort to ensure the accuracy of the information presented. However, it should be acknowledged that the figures and pricing details published by these companies may be subject to change at their discretion and in accordance with their policies.
This article is intended solely as a general informational resource and should not be construed as financial, legal, or professional advice. Readers and retailers are strongly encouraged to seek independent professional advice and engage directly with payment service providers to obtain the most accurate and customised pricing information tailored to their specific circumstances. All negotiations and contractual agreements should be conducted directly with the relevant payment service provider.
