1. Overview of Online Payment Types
The online payment types which can be accepted are continually growing in number
and generally mirror offline types of payment. The main online payment types
orientate around card payments and direct debit payments which are outlined below:
ONLINE DEBIT CARD PAYMENTS
Debit card payments can be accepted online and used for real-time, card scheme
permitting, subscription and recurring billing. Debit cards are typically linked directly
to the cardholder's bank account and payments are authorised only if the funds are
actually available or if your card issuer is happy to provide you with an overdraft
(unlike credit cards - see below).
Debit card payments online typically require authentication using the 3D Secure
authentication process, although this depends on the implementation being supported
by the card issuer.
The primary debit card brands used in the UK are Visa and Maestro (being replaced
by MasterCard Debit).
ONLINE CREDIT CARD PAYMENTS
Credit card payments can be accepted online in the same way as debit cards, i.e. in
real-time, and these typically can be used for subscription and recurring billing
without any restrictions. Credit cards are a form of borrowing where the card issuer is
in effect allowing their cardholder to "borrow" money in line with a credit agreement
(in the UK these need to be licensed by the Office of Fair Trading (OFT) under The
Consumer Credit Act 1974). Therefore, the amount of funds available isn't linked to
the customer's bank account but based on their agreed credit limit and how much of
this is available to spend.
Credit card payments online typically require authentication using the 3D Secure
authentication process, although this depends on the implementation being supported
by the card issuer.
The primary credit card brands used in the UK are Visa and MasterCard.
ONLINE CHARGE CARD PAYMENTS
Typically charge card payments are treated in a similar way to credit card payments

2. but typically transactions are processed directly through the card issuer.
The principal charge card brand used in the UK is American Express.
PAYPAL PAYMENTS
PayPal is becoming increasingly popular, especially for lower value transactions, and
is seeing significant growth in its user base and market share of transactions. WPM
Education has a partnership with PayPal to provide education clients with preferential
rates for PayPal transactions.
ONLINE DIRECT DEBITS (ALSO KNOWN AS PAPERLESS DIRECT
DEBITS)
Direct Debits are historically popular in sectors where there is a requirement for
longer term billing or, in the education sector, where larger values (e.g. fees) are paid
over agreed instalments.
Paperless Direct Debits can be set up by a payer online and payments are then
collected through the BACS system (unfortunately not in real-time as they fall within
this traditional BACS processing process).
OTHER ONLINE PAYMENT TYPES
There are other online payment types, albeit these typically have a very small market
share and generally are a better fit for niche applications (e.g. mobile billing).