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Not all payment methods are made equal, and choosing the right payment options to offer your customers can definitely have an impact on your success in selling your handmade items online

02 July 2021

Compare Payment Methods for Selling Craft Online

Whether you have an established online store or you’re just starting out, it’s easy to invest all your energy into product descriptions and photos and how to market your goods, but equally as important, is the matter of how your customers are going to pay you. Not all payment methods are made equal, and choosing the right payment options to offer your customers can definitely have an impact on your success.

Even once you’ve chosen which payment methods you’ll accept, re-evaluating the providers you use to process payments for your online craft store is an important part of your brand’s continuous improvement strategy as both your business and the online payments industry evolve and grow.

Not all payment methods are made equal, and choosing the right payment options to offer your customers can definitely have an impact on your success in selling your handmade items online

So what should you look for in an on online payment method? That may vary from business to business, but at a high level, the types of things you should look for include (in no particular order);

1. A user-friendly dashboard

The best payment gateways provide a seller dashboard where you can view, report on, and manage your transactions easily. A good dashboard makes issuing refunds, locating customer and transaction information, and tax reporting a breeze.

2. Customisation options

The ability to customise your checkout experience gives you more control over how your customers shop with you, and another opportunity to communicate your brand.

3. A frictionless checkout

Friction is anything that slows down or prevents customers from completing the checkout process. The less friction your checkout experience has the less customers will abandon their shopping carts. In short, making it easier to buy from you ensures more completed sales for your store.

A frictionless checkout makes it easier for customers to complete their purchase and avoids abandoned carts.

4. Quick access to earnings

All payment methods have processing times, but even for those that process transactions in a matter of seconds, there will generally be some sort of wait time for those funds to be in your bank account or otherwise available for you to spend.

5. Customer recourse

Much like flexible returns policies and quality guarantees increase buyer confidence, customers are more likely to complete a purchase if they have a means of recouping their money if something goes wrong. Where a customer has no prior experience of your brand, dispute processes offered by banks and gateways on certain payment methods can help customers make the commitment to complete their purchase.

6. Transaction fees and setup costs

Most payment options have associated costs, whether it is an initial outlay to setup or a small fee on each transaction, or a combination of both. Even if those transaction fees seem small at first, it is important to factor in how they will impact your pricing and your bottom line as your sales and your business grow.

7. Security and reputation

Security is another important factor to consider when deciding on which payment methods to offer. Customers shopping online are aware of the multitude of scammers on the world wide web, and like you, they want to be able to shop with confidence, knowing that their financial details are being handled safely. On the flip side, scams can come from either side of a transaction and it is important to know that your payment methods have anti-fraud measures in place to protect you from chargebacks and dubious transactions. Choosing large or well known payment gateways can give you access to some of the best financial security technology and piece of mind for both you and your customers.

Payment Methods on Madeit

On Madeit you can give your customers access to a range of different payment methods without the hassle and cost of web development or building your own integrations. To compare the payment methods currently available on Madeit, I’ve summarised some of the more notable features of each and a short list of pros and cons to help you decide which payment options are a good fit for your business. You can stick with just our minimum payment gateway, Stripe, or you can elect to add on one (or a combination) of our other payment options; PayPal, Bank Deposit, and Afterpay.

Stripe’s seller dashboard is flexible and user-friendly to help you monitor and manage your transactions


Stripe is our default payment gateway on Madeit and a minimum requirement for all our new stores as a means of offering a consistent customer experience for all Madeit buyers at the lowest cost to Madeit sellers.

Even if you haven’t heard of Stripe, you have probably used it to make purchases online in the past. Founded in 2010, Stripe processed US$350 Billion of transactions in 2020 and they have over 4000 employees across the globe (including former Google Cloud CEO Diane Greene). So they’re no small player, but they are less of a household name than PayPal primarily because they don’t sign up end customers so you don’t see their branding on checkouts and most of the time you never know you are using Stripe. The benefit of this for sellers is that you’re not competing with another brand and another business’s interests as your customers complete checkout.

Stripe is free to setup and connect to your online store so sellers pay a flagfall plus a small percentage of the total sale price for each transaction. Transaction fees are deducted from the total as the sale is processed, so you receive the remaining balance in your Stripe account straight away. Unlike PayPal, you can’t use your Stripe balance to make purchases across the web, however Stripe automates balance transfers into your bank account, so you will usually receive money straight into your nominated bank account within two business days of the transaction.

It’s generally very easy to create a Stripe account and you can do so directly from your Madeit dashboard. You do need to provide some identification and although most sellers manage to be up and running within 5 minutes or so, depending on the structure of your business and the accuracy of the information you enter in your account application, Stripe may require more information to verify your account, which can draw out the process. You also need to provide a Support phone number for your customers to call, however you now have the option to hide the phone number from invoices and receipts from your Stripe dashboard once your account is created.

Stripe’s dashboard offers a lot of detail and great flexibility. You can easily link multiple Stripe accounts for use on different selling platforms to keep your transactions and reporting separate, and even offer different branding across different platforms, while still being able to easily switch between them in the one dashboard. The ability to customise the checkout, invoices and receipts through Stripe from their dashboard is also great for small businesses looking to present a professional online presence and build brand recognition.

Perhaps one of Stripe’s strongest selling points is their conversion-friendly checkout that offers a very smooth and intuitive payment flow for customers. Stripe’s checkout also gives customers multiple easy ways to pay, accepting all major credit cards as well as Apple Pay and Google Wallet for a quick one-click payment experience without the need for customers to create an account.

Like PayPal, Stripe offers world class security and they have a range of anti-fraud measures to protect sellers, but what is particularly nice about Stripe is the transparency of their dashboard. The homepage presents your transaction information in user-friendly charts, you can see details of failed or incomplete transactions as well as successful payments so if there’s something that is not working in your checkout you have plenty of information to resolve issues.


• Lower fees than PayPal
• Conversion-friendly checkout
• Range of payment options including Apple Pay and Google Wallet
• No signup or account required for customers
• World-class security
• Automated balance transfers to your bank account.
• Transparent, user-friendly dashboard with custom branding


• Some proof of identity required after account setup
• Entering incorrect / incomplete information at account creation can cause delays in getting approval.
• Can’t spend money in your Stripe account (for 2 days until it reaches your bank account)
• Not as well-known as PayPal

PayPal’s dashboard is easier to use, although less informative than their competitor, Stripe.


PayPal is somewhat of a household name, with 361 million global users it is the largest online payments processor in Australia. If you have a business PayPal account you can process credit card transactions through their checkout, and customers who have a PayPal account can sign in to pay you with their PayPal balance or any bank card attached to their account.

The great benefit of PayPal is undoubtedly their reputation and the ease of checkout for customers who have a PayPal account already. Perhaps their greatest drawback though, is PayPal’s focus on converting your customers into their customers. Although you don’t have to have a PayPal account to pay sellers with a business PayPal account, their checkout flow is heavily geared towards getting customers to login or sign up rather than checking out as a guest, and for those buyers who don’t want to create an account, this can cause confusion and results in a lot of abandoned carts. As admin of Madeit I regularly receive emails from customers who can’t work out how to get past the PayPal sign-in page to pay by card and it is safe to assume that most customers experiencing this difficulty give up and shop somewhere else instead of sending an email asking for help.

Show me the money: comparing payment methods for selling your handmade items online

PayPal is free to setup up and charges just a percentage of the total sale vale plus a flag fall fee for each transaction. Their fees are comparable to Stripe, although Stripe is a bit cheaper and if you process a lot of orders, that small difference adds up over time.

When you sell with PayPal the money is instantly available in your PayPal account. What is nice about that is that you can spend your money anywhere that PayPal is offered as soon as your customer completes checkout. To get your money into your bank account you need to make a transfer manually from your PayPal dashboard, and transfers usually land in your bank account within 3 business days.

Anecdotally PayPal seems to be less trusted in the handmade seller community than it once was due to reports of PayPal ruling in favour of customers either without following their dispute process, or in contradiction to supplied evidence. That said, their reputation for secure payments and their dispute resolution process are both great drawcards to instill confidence in buyers.


• Well established brand that customers know
• Quick and easy checkout for customers who have a PayPal account
• Payment dispute process gives customers confidence
• Money in your PayPal account can be spent online


• Slightly higher transaction fees than Stripe
• Some sellers have lost trust in the dispute process
• Difficult checkout experience for customers who don’t have a PayPal account
• Less information and tools in their dashboard than Stripe

Shop now. Pay later. Always interest-free with afterpay.


Unless you’ve been hiding under a rock somewhere (and who could blame you if you were doing just that since COVID hit?!) you’ll no doubt have heard about Afterpay and the many other Buy-Now-Pay-Later (BNPL) options taking the world by storm. Afterpay is an Australian-grown company, originating in Sydney in 2015 and already boasting a global staff of over 700 employees and 8.5 million global users, including 9% of (mostly young) Australians.

Afterpay allows customers to pay for an order in 4 equal instalments over 6 weeks, but sellers receive the full payment at the point of sale. They’ve gained something of a cult following, with Facebook groups dedicated to promoting only websites that offer BNPL options, and even some groups who insist that they will only shop from stores that offer Afterpay or similar. With hype like that you’re no doubt wondering if adding Afterpay to your store is going to magically transform your business, but bear in mind that these groups are a select niche of people dedicated to BNPL and may not be representative of your audience or your ideal customer.

Afterpay claims it increases conversion rates by an average of 20% and adds up to 40% to average cart values so there is certainly potential to grow your business with Afterpay, however AfterPay’s transaction fees are much higher than traditional credit card payments with Stripe and PayPal and if you issue an Aferpay customer a refund, you don’t get the transaction fees back (unlike other transactions with Stripe and PayPal) so it comes at a price.

Afterpay breaks down the product price into 4 interest-free payments on each product page

Afterpay is offered on Madeit through our integration with Stripe, so you won’t need another merchant account or go through another application process if you are already using Stripe for credit card payments. It’s as easy as a couple of clicks to add Afterpay to your Madeit store, and payout times, refunds and transaction reporting are all managed through the Stripe dashboard. However, not all business types are eligible to accept Afterpay so if you’ve set up your Stripe account with the wrong product type you will have to get it changed (through Stripe) to add Afterpay to your store. Afterpay is also not currently available between countries on Stripe so only your Australian customers will have the option to pay this way for now.


• Cult following; potential to attract a new audience
• Lessens checkout friction, particularly for high cost items
• Shown to increase cart values
• Easy to add through Stripe – no merchant account / approvals process for Stripe users.
• Makes use of Stripe’s feature-rich dashboard


• Comparably expensive
• Full fees paid even when transactions are refunded
• Not available to some business types (see help files for more info)
• Australian buyers only (not available between countries)

’Drive-in Banking’ sign

Bank Deposit

The original payment method offered on Madeit in the good old days is still an option for those who want to use it. The most obvious benefit of bank deposits is that there are no setup costs or transaction fees, but this payment method is simply a mechanism for customers to submit an order, at which point they’ll be provided with your bank account details (or you can provide them to the customer manually) to transfer the funds for the order through their online, phone banking, or in person at a branch. Sellers receive an order notification from Madeit prior to payment being made, and you need to hold off making or sending products until the customer pays you and that payment clears. This makes it a fairly manual process for sellers, but it also means customers can submit orders but may not get around to completing the payment.

There are also some limitations on who can use this payment method. Only registered buyers in Australia can pay by bank deposit as they’ll need an Australian bank account, and because payment is not instant, this payment option is not available for carts that include digital products for instant download.

From a customer’s point of view bank deposit isn’t terribly appealing because it takes longer for them to receive their goods if you have to wait for payment to clear, and disputes are entirely in the hands of the seller if something goes wrong. That said, it does have some appeal to those customers sensitive to handing out card details online, and with no cost to sellers, it may be worth offering for the occasional user who favours traditional methods of payment.


• No transaction or setup costs
• Appeals to customers sensitive to providing card details online
• Works well for return customers where trust is already established


• Lower conversion rates than instant payment methods
• Delays sending products to customers
• Limited availability (not available to international customers, guest buyers, or for digital downloads)
• Manual process to look for funds.

Payment Method Fee Comparison

The following comparison table details the transaction fees for domestic transactions for each of the payment options above. These fees are correct for Australian transactions at time of publishing (July 2021) but please check the current pricing pages for the relevant payment providers for current rates.

Transaction fee comparison table for Australian payments through the different payment methods available on Madeit

A Final Word

While all of the above considerations are important, don’t forget to keep your customers at the heart of your decision-making when it comes to payment methods. It’s all very well to only offer the payment method that is cheapest for you, but if your customers don’t want to use it you’re going to loose out on sales. Because we’re all unique and we don’t all want the same thing when buying online, it’s generally best to give your customers choices by offering a few different payment options.

Words by:
Madeit Editor, Louise

Louise (a.k.a. “Mrs Madeit”)

Wordsmith, art & craft enthusiast, and grand-visionary.

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