> UK > Virtual Terminal > Comparisons > Worldpay vs PayPal virtual terminal: which is best for phone payments?

Worldpay vs PayPal virtual terminal: which is best for phone payments?

By Lucy Harris|2018-11-02T11:19:33+00:00September 6th, 2017|Tags: , , |

Two of the most popular options in the UK for accepting card payments over the phone are PayPal and Worldpay. With these providers, you don’t need any equipment to accept cards over the phone – only a laptop or PC with an internet connection – because you’ll be using their in-browser virtual terminals.

In the table, we compare the entry rates from both PayPal and Worldpay. If you process cards for more than £1500 per month with PayPal, or opt for a more expensive monthly package with Worldpay, you can qualify for better rates.

Full virtual terminal review

Full virtual terminal review

To website
Get offer
Monthly fee£20£9.95
Transaction fees3.4% + 20p2.75%* may vary + 20p + 10p (gateway fee)
Chargeback fee£14£15
PCI complicance£250 per year recommended (through partner)Basic included, additional for a fee
Cards
Customer service8am to 8.30pm Monday to Saturday
9am to 8.30pm Sunday
24/7 phone support

* Rate provided is not guaranteed – depends on sales volume and other factors. However, you can can see the rate as a target for low-volume businesses.

Full review

Full review

To website
Get offer
£20/mo£9.95/mo
3.4% + 20p per transaction2.75%* may vary + 20p + 10p (gateway fee) per transaction
£14 per chargeback£15 per chargeback
£250 per year recommended (through partner) PCI complianceBasic PCI compliance included, additional for a fee
8am-8.30pm Mon-Sat, 9am-8.30pm Sunday phone support24/7 phone support

* Rate provided is not guaranteed – depends on sales volume and other factors. However, you can can see the rate as a target for low-volume businesses.

The first question that comes to mind is: how come PayPal gained such a high market share with rates that are clearly not competitive? A percentage of 3.4% on top of the fixed 20p can eat well into the margin for a lot of businesses.

The answer is, in part, the ease of signing up with PayPal’s virtual terminal, particularly for businesses with an already approved PayPal Business account. Worldpay involves a bit more hassle, although they are trying to smarten up their onboarding process.

It should also be said that for new PayPal customers, signing up for the virtual terminal is not as easy as it once was. Given the potential for fraud with phone payments, PayPal now requires new customers to call for a chat with an onboarding rep.

The first question that comes to mind is, how has PayPal gained such high market share with rates that are clearly not competitive?

Monthly fixed fees unavoidable

The PayPal fee is fixed at £20, while Worldpay’s monthly fee varies from £9.95 to £49.99. The latter is a fixed monthly price for a package that includes a relatively high number of transactions per month up to a “fixed threshold turnover level”.

The information online about Worldpay’s fees for just the virtual terminal is confusing, to say the least. While there used to be a package that promised competitive processing fees, you’ll have to phone up and ask about plans. It is all very secretive, isn’t it – they refused to give us any details for publication when we last phoned them, but promised to tell you more over the phone. If you are interested, by all means ask for a callback and prepare to negotiate. This is a company that definitely has the ability to give you a good price, as long as you know what you are looking for.

A refreshing entrance to the UK market is Square Virtual Terminal. In stark contract to PayPal and Worldpay, Square doesn’t charge merchants any fixed monthly fees for their virtual terminal – only a flat 2.5% transaction fee for all keyed-in payments no matter what card is used. It will be interesting to see if Worldpay and PayPal will eventually simplify their fees in response to this kind of transparent package that undoubtedly will prove attractive to many small businesses.

PayPal has a better online interface

The Worldpay interface is totally acceptable and understandable. It just looks like it was made ten years ago, which is probably the case. PayPal is more on the ball with online user experience and constantly tweaks their user experience to be as fast and painless as possible.

Worldpay virtual terminal page

The Worldpay interface can be slightly hard to read, but is relatively intuitive. Image: Worldpay.

Worldpay can be more personable

Worldpay customer service has its own reputation for leaving a lot to be desired, but compared to PayPal, you are closer to real customer teams based in the UK. If you get a frozen PayPal account and all phone payment business has to be put on hold, you might actually wish you rather had to deal with the mixed bag of Worldpay responsiveness.

Worldpay offers 24/7 phone service, while with PayPal, you will have to call within working hours. Both have email support options.

Verdict

If you don’t already have a PayPal Business account and feel you should stick to your own system for accounting purposes and ease, we’d recommend getting an offer from Worldpay so you can make a qualified decision between the two. Especially if you are a business with over-the-phone payments totalling less than £3000 a month, Worldpay rates are likely better, even with the basic £9.95 pay-as-you-go monthly package.

Visit PayPal site
Get offer from Worldpay