Should You Build Your Payment Solution From Scratch?

There are a lot of different ecommerce, subscription and payment solutions available. And the cost of these solutions differ greatly. If you are consulting a company or looking for a solution for your own project, here are some pointers that can help make the choice easier between investing in building your own payment solution or opting for an out of the box solution.

Especially when it comes to subscription and payment solutions there is a lot to consider and the consequences of either choice can be far reaching.

As from your earliest idea onwards you’ll be answering two simple questions. Two questions that force you to prioritize your resources, and consider long term financial consequences. “Do I build or buy?” And “Do I build or buy it now?”

You should ask these questions in this exact order. You might be inclined to ask the question if you need something now, first. But contrary to your instinct make the assumption you need it first, and consider what it takes to build something and compare purchase options. Why? Because it forces you consider long term impact for your business first and from there it will be easier to motivate the decision to pursue this option or not.

These simple questions will help you to invest in things that will generate income or save you money in the long run. Breaking these questions down will give you a simple and easy to follow framework for all future financial decisions:

In general when it comes to making investment decision about your product your leading principle should be: own it and control it. Every part of your product that is essential to your value proposition you should build and own – period.

Make sure you or your company owns all ip. All tech stack and resources should be in your company’s name and control. Not on the server managed and controlled by the contractor helping you build YOUR product.

It has cost us a lot of time and money to get everything from our initial supplier towards our own environment. A decision hastely made out of convenience in the early stages – proved a big and costly mistake a year into the project. That is not so say buying in services to support your product isn’t something you should consider.

Depending on the stage of your business using third party server & compute space, for example, is a very efficient decision. And when it comes to payment platforms there is really no way around them.

A broader discussion on making sound financial decisions – if you are interested you can read (or listen to) here

So how does this play out when it comes to choosing a payment solution? Let’s follow this “making sound financial decisions” framework.

*Make the assumption you need it

It seems clearcut and not much of an assumption at first sight, if you wanna get paid for the products or services you offer. Still it is not as clear-cut an assumption as you might think. If you are very early in your product validating process you might still be testing the waters with your business model and your value proposition.

Your product or service offering might change considerably still – making the prefered payment options and subscriptions you want to offer customers unclear. And maybe simple one on one contracting and invoicing works best at that stage and there is no need for an advanced online payment solution.

But also in that case you should assume you need it to make a worthwhile comparision and informed decision to pursue or not.

*Consider what it takes to build it

This forces you to describe in detail your business requirements and user stories (as much as you can).
When it comes to a payment solution it matters if you are seeking a simple ecommerce solution or wish to provide extreme customized solutions such as usage based subscriptions and product add-ons.
The better you are able to describe the business rules and user stories – the better your team is able to provide an accurate estimate and the better you will be able to compare available payment solutions in the market. The challenge here often is whether you have a clear vision on the customer experience.

*Compare purchase options.

So once you know what it takes to build it, you can check out what solutions are available for you to buy as an out of the box full service solution or maybe for parts of your payment flow.
Here are some well known providers ranked by finances.online: Top-20 payment gateway providers by Finances Online

My advice, if you are looking for more advanced features, to create a test account wherever possible and start checking the platforms options against your requirements.

And more importantly for the long run: check the fees per transaction (most common model used by these platforms) or per month/year (in case of a subscription).

Also check how well these platforms are documented (check their API docs), their service desk, do they have an active developer community? How well are these supporting your platform language, versions? What are their security protocols, do they support the payment options you require?

*Pursue the option – yes – no – later

So – yes at this point a lot of work has gone into one of your major decisions impacting your roi: choosing your payment solution. But now you have a good overview of what you need, what it would cost when you would build your own, and the options available in the market. You can now make or present an informed decision to pursue any of the options based on your business strategy and stage of your business.

Also if you have opted to not pursue this option right now, or have opted for an out of the box solution for now, it might be a good idea to do this exercise again after a certain period of time. Like when your business has changed or if new payment options have entered the market. In our business new and cheaper technological solutions enter the market every day – so keep a close watch if any of these solutions might change your earlier decision.

Rather than making a comparison between available payment providers I have chosen to provide you with some guiding principles to make the best financial decision for your specific use case. If you have an experience you would like to share from one of your own projects? Feel free to get in touch.

CEO/Founder of ANDRS Projects: An innovator who believes innovation can only arise from collaboration.

Her life’s motto is “Collaborate or Die”.