Understanding Credit Card APIs and How Developers Can Use Them

Websites and applications that require the processing of credit card payments, such as an eCommerce store, need the functionality to process and authenticate those payments with the card issuer. But it’s not appropriate (or even remotely secure enough) to simply ask customers to fire over their credit card details to you. Instead, the payment needs to go through a payment processing provider via a payment gateway.

So how do you securely embed the functionality to communicate with a credit card payment processing provider’s online payment gateway within your site or app?

In this article, we’ll look at how this integration is achieved and what developers should know about the different payment processing options available for modern websites and apps.

TL;DR

  • A credit card API refers to the Application Programming Interface that will allow you to set up a secure payment processing facility within your app or website.
  • If you prefer to have more control over the payment experience on your website or app, then it’s important to select the credit card API that’s right for you.
  • Some of the top credit card API providers include Stax, Square, Stripe, and Braintree.
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What is a Credit Card API and How Does it Work?

A credit card API refers to the Application Programming Interface that will allow you to set up a secure payment processing facility within your app or website. APIs should be familiar to all developers as the building blocks that allow software programs to interact with one another. But understanding how they work, where they would be used and specific applications for utilizing credit card APIs may not be quite so well known.

The right credit card API should make the developer’s life a lot easier, and can provide a custom checkout experience for customers. It effectively handles the secure acceptance of all payments via methods your site or app has chosen to accept. With Americans willing to spend as much as 100% more per transaction when using a credit card, it’s easy to see why credit card acceptance is so vital today.

Credit Card APIs vs All-in-One Payment Platforms

Depending on how you’re building your site or app, you might have alternative options for payment processing. Many of the most popular eCommerce site building platforms have their own integrated payment processing solutions, such as Shopify Payments for sites built using Shopify.

While there are certainly advantages to using the off-the-shelf option of an all-in-one payment processing platform, you do have to bear in mind that there’s a trade-off too.

For one thing, you wouldn’t have a direct merchant account relationship with the payment gateway that provides the authentication for payments and distributes funds to you.

You’d also have less control over costs and while the headline rates might seem attractive at first, this is usually because you’d already be paying the eCommerce platform provider as part of your ongoing subscription.

As an example, Squarespace offers 0% transaction fees on their Commerce plans, but those plans start at $27 per month. What’s more, you can still incur fees for processing certain types of fees which are charged by the payment processor.

When you have full control of your site or app, you can choose which payment gateway to work with and use their credit card API to integrate the payment processing functionality into your site. You’d control the relationship with the payment processing provider and would pay them a fee per transaction or monthly subscription basis, depending on the provider you choose.

This gives you a great deal more flexibility, particularly if you may want to expand your sales to different territories and accept other modes of payment. It also means that as you grow, you might potentially negotiate lower fees per transaction.

How Can You Use Credit Card APIs?

If you prefer to have more control over the payment experience on your website or app, then it’s important to select the credit card API that’s right for you. Doing so will enable you to:

  • Accept customer payments by credit and debit card (e.g. Visa, Mastercard and American Express etc.) and direct bank account transfer
  • Accept and set up regular recurring payments (e.g. for monthly subscription service payments)
  • Set up and update customer billing information
  • Automate common eCommerce workflows to streamline your sales funnel and checkout process
  • Receive alerts about your transactions, keeping you on top of sales performance
  • Access to monitor your payment analytics and assess balances held in different accounts
  • Benefit from the functionality and support to handle chargebacks and any claims made against you (e.g. if a customer claims not to have received their order so has requested a refund)
  • Integrate with your sales, accounting and other important software tools for data management, analytics and recordkeeping

In terms of how you use the credit card API itself, there are various methods of implementation—some of which are more straightforward than others.

Most payment processing providers offer software development kits (SDKs), along with relevant documentation to aid with setup.

It’s important, therefore, to ensure the merchant services provider you’ve chosen to work with supports the platforms you’re building your product for and has detailed documentation to allow you to pull everything together.

Most providers would be expected to provide credit card APIs with SDKs for iOS, Android, Python and major JavaScript frameworks but never assume! You’ll always want to double check before setting up a merchant account with a payment provider that their API is going to be compatible with the product you’re developing.

Which are the Top Credit Card APIs for Developers in 2022?

Below is an overview of popular credit card APIs available today, along with details on their main features and considerations for developers.

1. Stax API

One of the top players in the market, Stax was founded in 2014 and has quickly made a serious impression as a disruptor in the space. It has a few notable USPs that set it apart from the competition such as its use of multiple gateways.

While most payment processing providers use their own payment gateways, Stax offers integration with multiple gateways such as from Authorize.net and NMI. This allows a greater level of flexibility for customers and leaves them less susceptible to outages. If one network goes down, they have others they can rely on instead.

Additionally, the payment model for Stax is unique in that they charge their customers on a flat fee monthly subscription basis that allows them to offer no additional fees per transaction other than the standard interchange rate, which is set by the different card providers. In practice, this means that any business with sales exceeding $5,000 per month will likely save money compared to using a payment processing provider charging per transaction.

From a developer’s perspective, working with Stax couldn’t be simpler. They offer SDKs for iOS and Android as well as for Python and JavaScript frameworks through their proprietary Stax.js library, meaning that integrating their gateway into modern apps and websites is very straightforward and their comprehensive API documentation leaves no stone left unturned. The fully featured sandbox mode allows developers access to all the various parts of the provider‘s infrastructure and this can really help simplify ongoing development.

What’s more, the variety of integrations available for third-party tools is incredibly impressive and Stax API will sync up easily with the likes of Xero, Quickbooks, Wave, Zoho, Hubspot, Mailchimp and many more related tools.

The monthly plans start at $99 per month although access to the API requires a Pro plan, costing $159 per month.

Pros

  • Monthly flat fee subscription model means businesses can save as much as 40% on payment processing fees compared to using other providers
  • Fantastic support and documentation for developers
  • Payment analytics dashboard provides real-time transaction data for deep level sales insight
  • API can be used with virtually any language
  • Loads of valuable integrations

Cons

  • Smaller businesses could end up paying more if their volume of sales is under $5,000 per month
  • Stax doesn’t cater to high-risk merchants

2. Square API

Square is a payment processing provider that’s very well known in the SMB market. As you’d expect, they provide a gateway that processes payments from all the usual sources including debit cards, credit cards, bank transfers (automated clearing house or ACH) and mobile wallets (Google Pay and Apple Pay).

Square also provides a number of additional services for customers, including facilities to manage loyalty programs, run inventory and stock control and manage internal teams. These features are mostly nice-to-haves rather than must-haves but will undoubtedly appeal to some sellers.

Their suite of SDKs means that the Square API works across multiple platforms and will appeal to the majority of developers seeking simplicity of full integration. Their support is also very good, although Square’s documentation isn’t quite on par with the level of depth found with resources on the Stax website.

Unlike Stax, Square follows a more traditional method of charging per transaction and their fees range from between 2.6% + $0.10 to 3.5% + $0.15 depending on how the card payment is taken. For ACH payments the fees are 1% with a $1 minimum.

Pros

  • Good level of support for developers and multiple SDKs
  • No long term contract
  • Some users will appreciate the extra features beyond the primary payment gateway functionality

Cons

  • Fees can quickly mount up, particularly for manually processed card payment transactions (i.e. those keyed in where the cardholder is not present)
  • Some customers complain of stability issues

3. Stripe Payments

Stripe is a long established and well known provider of payment processing services with a strong reputation in the industry. You do need to commit to using their payment gateway with their API, so there’s no option to mix and match with a third party gateway.

As with the other providers, they will happily process payments from all the usual payment methods and their support for international payments is particularly strong. Developers, meanwhile, are certainly looked after with a very strong API support offering on their site, and the API‘s compatibility with popular languages such as Python, Java, Ruby, PHP and .NET makes it a strong choice for those who are working outside of just the most popular JS frameworks.

Stripe is another provider charging on a per transaction basis, and their rates start at 2.7% + $0.05 rising to 2.9% + $0.30 for card payments, while ACH transactions are subject to a 0.8% fee up to a maximum of $5.

Pros

  • Excellent international currency integration
  • Strong variety of programming languages supported for API

Cons

  • Fees can get expensive with higher volumes of monthly sales
  • No developer sandbox

4. Braintree

Braintree is a payment processing provider that’s part of the PayPal family. On the plus side, it is backed by one of the world’s biggest and best-known financial brands. On the downside, they do tend to charge more for that big brand backing.

You can use Braintree as a payment gateway by itself if you have a merchant account with another provider. However, this rarely tends to work out cost-effectively so it makes more sense to use Braintree as a merchant account provider and payment gateway together.

One advantage Braintree has over other gateways is that it works seamlessly to accept payments via PayPal and Venmo, as well as all other common payment types (cards, mobile wallets and ACH etc.)

API functionality is good although not quite as fluid as with the total flexibility offered by Stax. Furthermore, their API support, although extensive, isn’t laid out as well as it could be. Often it can be unwieldy to navigate the documentation and access what you need to.

As indicated above, their pricing isn’t quite as competitive as the other providers we’ve looked at. Braintree will charge 2.59% + $0.49 per credit, debit and charge card transaction whilst ACH payments attract a fee of 0.75% up to a maximum of $5.

Pros

  • Seamless PayPal and Venmo integration
  • Strong account stability

Cons

  • More costly than the competition
  • Support for developers is difficult to work with
  • Setup can be complex and requires plenty of patience

4. Intuit QuickBooks Payments API

If you use QuickBooks for your business accounting, you will have no doubt already been made aware of QuickBooks Payment API. Its chief advantage is the seamless integration with QuickBooks. This means if you’re already embedded within the Intuit ecosystem, you can be confident this will play well with your existing sales setup.

With QuickBooks Payments API you’re not actually using QuickBooks as the payment processor. Instead, they rely on Fiserv to operate their gateway. In practice, this isn’t particularly noticeable, but it’s important to make the distinction nonetheless.

Developers should find the API documentation is relatively in-depth and as its API uses the REST Framework there’s a good level of flexibility. That said, there’s little reason to pick this provider over more supportive rivals if you’re not already an Intuit QuickBooks customer, particularly given the pricing.

QuickBooks Payments API ends up as one of the more pricey payment processing options with merchants having to pay between 2.4% + $0.25 up to 3.4% + $0.25 per transaction for payments via card or mobile wallet. ACH transactions will cost 1% up to a maximum of $10 each time.

Pros

  • Good API documentation
  • Seamless integration with QuickBooks

Cons

  • More costly than the competition
  • Not ideal if you’re not using Intuit products

Final Words

When it comes to payment APIs, there’s no shortage of options for developers. The key to finding the best one is to evaluate your business requirements and current tech stack.

If you need help figuring out the right payment API for you, get in touch with Stax team to discuss your needs.