Mobile Payments – In App payments: How not to get lost!

In-app payments

The rhythm of modern life seems to get faster and faster all the time. That means we have less time for real shopping. Rather than spending hours wandering around overheated malls or in queues to check out, many of us prefer to buy, not even via our desktops as much anymore, but via mobile, leaving behind the days when we searched in our bags or our pockets for our wallets. Statistics are striking: in 2018, mobile commerce sales is expected to top $293 billion according to Forrester research¹, seventy-one percent of all ecommerce. Isn’t that solid evidence that mobile commerce is conquering the market?

It seems easy enough: consumers who make purchases via mobile just enter their credit card data and complete the transaction. But it becomes less easy if you switch from the role of consumer to that of a mobile app owner who is faced with the decision of which payment system to choose.

There are so many options, depending on whether you are selling digital goods or real goods, what mobile platform you use, and what percentage commission you’ll be charged by your chosen payment system for each transaction. At Softjourn we have recognized the need to help sort out the options for our clients.

To begin with, one thing determines the rest: what type of products you offer on the market, whether digital (like videos, e-books, music, streaming media and so on) or real (tangible goods). That’s a key question since it will influence the mechanism you choose for selling your goods.

When you offer an iOS app selling digital goods such as ebooks, you have no choice: you must use Apple’s payment system, in which case Apple also takes a 30% commission on every purchase your customer makes. The situation is different when we talk about real products that you sell through your iOS app. In this case, you can integrate with third party payment systems (we’ll talk more about those systems a bit later).

What about Android? Google Play doesn’t put such stringent restrictions on its apps, so we are lucky to be able to choose whether to use Google Play’s payment service (30% commission) or to integrate with any other payment system compatible with Android devices. Sound messy? Maybe the infographic below will help to visualize!

There are quite a few payment systems to choose from and their number is growing. For now, let’s just consider some of the most popular and robust ones that will enable your iOS or Android app to process payments in a secure transaction environment.


“Shop around the world”

If you’ve ever purchased anything on eBay, or any number of other ecommerce sites, then you’re probably familiar with PayPal and know how simple it is. Here are its main features:

Location: It’s one of the world’s most widely used payment systems as it handles as many as 26 currencies across more than 190 countries.
Fees: The commission PayPal charges depends on three factors: the nature of transaction, the amount of money that PayPal processes for you each month, and whether your transaction crosses international borders or requires currency conversion. In most cases, PayPal charges 2.9% (plus 30 cents per transaction) of the amount of money your customer pays. There may be some discounts as volume goes up. No monthly or setup fee required.
Security: Why do so many people use PayPal around the world? Simply because PayPal has a reputation of the most secure and trusted payment system and one that does not disclose credit card information online

“Accept payments anytime, anywhere”

Here’s a fun fact: Stripe gave Twitter its “Buy” button² and now it’s working with Facebook to power that social network. If these recognized brands use it, there must be a lot of good reasons for that. Stripe’s main goal is to take away the headache of accepting credit cards online. It takes care of security so you can spend more time running your business instead of worrying what goes on behind the scene. Like PayPal, it’s easy to use and global. However, if fast access to your funds matters for you, keep in mind that Stripe takes a full 7 days to send you the money, whereas PayPal usually takes only 1 business day.

Location: Stripe supports 139 currencies and operates in 23 countries, so you can create charges in any currency and the services automatically handle converting the funds for a 2% exchange rate fee.
Fees: Like PayPal, Stripe has transparent pricing: 2.9% plus 30 cents per transaction without any monthly or setup fees.
Security: Security is another name for Stripe, since the credit card data that your customers enter into your payment form are never sent to your server. As a result, you don’t handle any sensitive data on your servers and can sleep safe and sound at night without worrying about hacker attacks on your clients’ private information.

Google Wallet

“Receive money and spend it instantly”

An option available only for Android app owners is to receive payments via Google Wallet, which is also known for its proven security. It comes with 24/7 monitoring and covers all verified unauthorized transactions. It allows two options: in-app billing (for digital goods) and instant buy for Android (real goods and services) and all purchases are held via MasterCard`s Zero Liability protection system.

Location: Google Wallet is available for merchants in over 160 countries, however mobile app for sending and receiving money is available only in US yet.
Fees: Google Wallet doesn`t charge a fee but it works with the primary payment processors (like Visa, MasterCard etc) that charge industry-standard fees.
Security: The credit card number of the buyer is never exposed to merchants due to the technology called Host Card Emulation (HCE), which functions like a Secure Element chip but lives virtually in the cloud.


“Start selling more, saving time and money”

Authorize.net is a trusted payment solution for mobile and online payments, owned by CyberSource, which in its turn is owned by Visa. It also offers 24/7 fraud support and a bunch of additional options, like recurring billing, fraud detection, information management etc.

Location: Authorize.net allows you to accept international transactions from customers worldwide, but there is one nuance: your business must be based in the US, Canada, the UK, Europe or Australia³.
Fees: In comparison to other gateways, this one is a little more expensive. It will charge you 2.9% plus 30 cents per transaction the same as the first two gateways, but here you`ll also have to pay a $25 monthly fee and a $49 setup fee.

Security: This gateway has fraud detection suite which allows to identify, manage and prevent suspicious and potentially fraudulent transactions and it is one of the most trusted and well recognized payment gateway that many consumers know they can trust.

Amazon Payments

“Grow your sales through a better buying experience”

Probably you are surprised that we didn`t mention this gateway earlier, but we saved it for the last and, of course, not the least. As Amazon released its own app store for Kindle Fire devices, it has also introduced Amazon Payments where customers can login to your website with their Amazon account credentials and pay for their purchase using the information stored in their Amazon account. As a result, the buying experience is very positive and your customers spend less time on purchases.

Location: Currently only sellers with a bank account in the US, UK or a country within the Eurozone are eligible to receive money through Amazon Payments.
Fees: Each domestic US transaction will cost 2.9% + 30 cents unless you process more than $3,000 per month – in this case you`ll have a discount kindly offered by Amazon.
Security: Amazon Payments never record any customer credentials in any database, cookie or browser session, they just pass them through to the user`s bank to verify the account. As soon as it is verified, the credentials are no longer availble preventing any fraud attacks.


In short, there is no single “best fit” payment gateway for all apps and the many different options available allow for choosing the one that really best fits the purchasers and the app owner. To check out what in-app purchasing can look like, check out Softjourn’s demo app showing in-app purchases of venue tickets at the door. If you still feel uncertain about what payment system would integrate perfectly with your app, drop us a line or call us and we’ll help you make your decision!


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