As WePay Shutters Its Hosted Checkout, A Rival Seeks to Sign up Disappointed Merchants

By Kevin Woodward

n

At least one competitor of payment-service provider WePay Inc. is working to take advantage of WePay’s decision to cease providing a hosted checkout service for online merchants. 2Checkout.com Inc., Columbus, Ohio, this week began wooing merchants that may want to stay with a hosted checkout service rather than use the application programming interface (API) WePay says it is now offering exclusively.

n

As part of its campaign to pick up disappointed WePay merchants, 2Checkout issued a press release saying it continues to offer a hosted checkout service.

n

Hosted checkout services can be customized and localized for the consumer, says Tom Dailey, 2Checkout chief executive. For example, 2Checkout says transactions on its service can be presented in 26 different currencies and in 15 different languages. “You can’t do that with API without a lot of coding,” Dailey says.

n

API integration typically requires the aid of a developer, Dailey says. Hosted checkout services often have much less code to add to a Web site, and hosted checkout providers typically handle the encryption and security elements, he adds.

n

WePay’s move to shutter its hosted checkout service, which it announced last week, means an unknown number of merchants will have to adopt WePay’s API or find another hosted checkout provider. The API enables merchants to integrate the payment process directly into their Web sites, which typically means the purchaser does not leave the site to complete a transaction.

n

With hosted checkout, the consumer typically is redirected to the payment provider’s site to enter the payment information, and then returned to the merchant’s site to complete the transaction.

n

WePay’s decision was spurred by the 600% growth in revenue from merchants using WePay’s API, Bill Clerico, WePay chief executive, said in a Jan. 16 blog post. “As we double down on it, we will be discontinuing our direct-to-consumer business to allow us greater focus on our payments API for such platform businesses,” Clerico says. “WePay’s future lies in our API.”

n

Such platforms include online marketplace and crowdfunding sites likes CustomMade, Care.com, GoFundMe, Fundly and others, a WePay spokeswoman says. In October, WePay said crowdfunding sites using its API generated $1.5 million in daily payments for the Palo Alto, Calif.-based company.

n

The significance of this change for merchants that use it is not lost on the company, Clerico said. “I know that for our hundreds of thousands of direct WePay users, this will be a very significant change,” Clerico said, “and we will work tirelessly over the next few months to make the transition as smooth as possible.” WePay says that will happen within 90 days.

n

To aid merchants using its hosted checkout service, WePay lists on its support site 13 companies that merchants can use, such as Fundly for personal donations, Soldsie for e-commerce, and InvoiceASAP for invoicing.