PayPal vs Google Checkout
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Online Payment Gateways

Online payment gateway is the method to electronically transfer money. Ecommerce websites has made online payment gateways a subject of major interest. With the aid of these gateways, online customers can make payments and transfer fund across the world. PayPal and Google Checkout are two popular online paymentgateways that operate as a transfer mediator between a merchant and a buyer.

PayPal and Google Checkout both offer a way for buyers to securely shop online, and protect customers and businesses by their anti-fraud policies. Both online payment gateways provide SSL security. Though both the options have some pros and cons, they are free to set up and signing up is simple.

PayPal

Owned by eBay, Paypal has been around on the web for years. Pay Pal is one of the most widely adopted forms of online payment gateway.

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  • PayPal needs your e-mail address and some basic details to set up an account and later ask over for yourcredit card or bank account information as needed.
  • PayPal is much more popular than Google Checkout as it offers an extensive variety of services for shoppers and businesses to exchange funds.
  • PayPal is more diverse as copared to Google Checkout. A customer can only make use of credit or debit card with Google Checkout. PayPal, in contrast, permits for credit card payment and deduction from a bank account. It also grants eCheck facility.
  • PayPal is available in 55 countries. PayPal accepts six currencies, the U. S. dollar, euro, the pound, the Canadian dollar, the yen and the Australian dollar. Currency exchange facility is also available with PayPal.
  • Your level of account decides the charges on PayPal. You have to pay 1.9 percent to 2.9 percent of your sales, and 30 cents per transaction.
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Google Checkout

Google Checkout has been launched by Google in 2006 as an alternative to PayPal.

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  • Google Checkout is deemed much easier to use than PayPal. You can pay for goods more easily and in fewer steps.
  • Google Checkout allows storing addresses, credit and debit card information in its system and you don’t have to retype all that data each time.
  • Google Checkout allows a user to log in to a single Google username to shop online, while hiding the data and e-mail address from traders where as PayPal keep financial details concealed from stores, however merchants can see e-mail address of the buyers.
  • Google Checkout is only available for U. S. purchases. So, no international shopping is possible with this online payment gateway.
  • Google Checkout charges as  low as 1.9% of sales and 30 cents per transaction for large monthly sales volume. However, you can utilize your Google AdWords account to lower the cost of your transaction fees.
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Google Checkout has the advantage of integration with Google AdWords while PayPal has a wide range of features available that include invoicing, statements, shipping and tax calculations. One should consider his ecommerce website needs before deciding on eitheronline payment gateway.

A Side-by-Side Comparison

Paypal

Google Checkout

Setup time quick and easy for simplest implementation (< 30 mins) quick and easy for simplest implementation (< 30 mins)
Accept Payment Methods

 

Credit Card, Debit Card, Direct Debit, eCheck Credit Card, Debit Card
Cost

 

$0.30 + 1.9-2.9% per transaction $0.30 + 1.9-2.9% per transaction
Non Profit Discount

 

yes only for Google Grants recipients, through 3/31/2012
Branding

 

trusted, well known payment processor Google Checkout logo appears by your site in search listings. Said to boost clickthrough rates.
Customer service

 

phone prompt, can eventually speak to a human email only
Google Adwords Bonus

 

None No longer offered
Subscriptions

 

easy to use functions for subscriptions and transaction currently only in beta, requires developer implementation
Sales Taxes

 

Will add automatically once setup in profile Will add automatically once setup in profile
Digital content sales yes yes. By default operates under ‘pessimistic delivery,’ meaning in rare cases when credit card authorization takes longer than usual, Google Checkout will not deliver content untill authorization is complete. For content where access is revokable, vendor can choose ‘optimistic delivery.’
Retreive funds

 

Manually withdrawn from Paypal account to your bank account Automatically deposited to your bank account 2 days after a charge is initiated.
Prohibited Items illegal subtances, weapons, gambling of any kind, tabacco, prescription drugs, financial services (currency exchange, credit repair etc.), adult content, copyright media and software illegal subtances, weapons, gambling of any kind, tabacco, prescription drugs, financial services (currency exchange, credit repair etc.), adult content, copyright media and software, bulk marketing tools and lists, academic paperwriting and test taking services, alcohol
Record keeping

 

sophisticated invoice system suited to small businesses rudimentary record keeping
Fraud protection

 

excellent, but does not handle complaints for orders under $50 excellent
Does buyer need to make account?

 

no, but Paypal likes to encourage them to open an account buyer will need to create a Google account on purchase
Process payments without leaving your page? no in the free version, yes in the Pro version ($30/month, SSL certificate required, developer integration) No, full service checkout only

How We Made the Choice

After using PayPal as our payment processor for over 5 years, our Business Premier account was closed without any reasonable explanation. If you search the official PayPal support forum on getsatisfaction.com for “account closed“, you will find hundreds of disgruntled customers that have experienced permanent account limitations with no reasonable explanation.  We were forced to immediately find another processing solution and Google Checkout was the obvious choice because of the strength of the Google brand and the ease-of-integration.  Creating a shopping widget is as easy as typing the product details into a Google Docs spreadsheet and adding the provided code into our WordPress post or page.  We are immensely happy with the flexibility it offers as well. Since PayPal did not value our business enough to give us a reasonable explanation for permanently closing our account, we are happy to migrate over to Google Checkout.