Online payment gateways: a guide for accounting practices in Australia

Published Thursday 11 June 2026

Table of contents

• Why online payment gateways matter for your clients
• How online payment gateways work
• Benefits of payment gateways for small businesses
• Payment gateway fees and costs in Australia
• How to set up a payment gateway for your clients
• Advising clients on choosing the right payment gateway
• Streamline client payments with Xero
• FAQs on online payment gateways

Key takeaways

• Online payment gateways let your clients accept card payments, direct debits, and digital wallet transactions directly from their invoices, reducing the time spent chasing overdue payments.
• Late payments remain a significant problem for Australian businesses, with 63% losing money to them. Payment gateways help address this by making it easier for customers to pay on time.
• Most gateways charge per-transaction fees rather than setup costs, so the barrier to entry for small business clients is low.
• Xero customers who use online invoice payments get paid up to twice as fast, making payment gateway integration a practical recommendation for your advisory conversations.

Why online payment gateways matter for your clients

Late payments are one of the most persistent cash flow challenges your clients face. As their advisor, you're well placed to recommend solutions that address the root cause rather than just managing the symptoms.

Research from GoCardless (2025) found that 63% of Australian businesses lose money to late payments, and 17% of Australian small and medium businesses lose over $2,500 per month. These figures represent real revenue leakage that compounds over time.

Online payment gateways tackle this problem by removing friction from the payment process. When a customer receives an invoice with a "pay now" button, they can settle it immediately using their preferred payment method. The result is shorter payment cycles and more predictable cash flow for your clients.

For your practice, recommending and helping clients set up payment gateways is a straightforward advisory conversation that delivers measurable results. It's the kind of practical guidance that strengthens client relationships and positions you as a proactive advisor.

How online payment gateways work

A payment gateway acts as the secure intermediary between a buyer and a seller during an online transaction. Understanding how they function helps you explain the process clearly to clients and troubleshoot any issues that arise.

When a customer clicks a payment link on an invoice, the gateway encrypts and transmits their payment details to the acquiring bank. The acquiring bank then communicates with the customer's issuing bank or card network to authorise the transaction. This entire process typically takes just a few seconds.

Once authorised, the funds are settled into the merchant's nominated bank account, usually within one to two business days. The gateway handles the security, compliance, and data encryption throughout, so your clients don't need to manage sensitive payment information themselves.

Payment gateways support multiple payment methods. The most common options in Australia include:

• Credit and debit cards: Visa, Mastercard, and American Express processed through providers like Stripe.
• Direct debit: Recurring payment collection through services like GoCardless, useful for subscription or retainer-based businesses.
• Digital wallets: Apple Pay and Google Pay, which are growing in popularity for online transactions.

Xero integrates with Stripe, GoCardless, and other payment services, so clients using online invoicing can enable payment gateways without switching platforms.

Benefits of payment gateways for small businesses

When you're advising clients on whether to adopt a payment gateway, it helps to frame the benefits around outcomes they care about most. Here are the key advantages worth highlighting in your conversations.

• Faster payment collection. Xero customers who use online invoice payments get paid up to twice as fast. Removing manual steps from the payment process means customers can pay the moment they receive an invoice.
• Improved cash flow visibility. Payments processed through a gateway are recorded automatically, giving your clients a clearer, real-time picture of their cash position.
• Reduced administrative burden. Automated payment matching and reconciliation mean less time spent on manual data entry and following up on outstanding invoices.
• Better customer experience. Offering multiple payment options, including cards and digital wallets, makes it convenient for customers to pay in the way that suits them.
• Stronger security. Payment gateways handle PCI compliance and data encryption, which reduces your clients' exposure to fraud and data breach risks.

From a practice perspective, helping clients set up payment gateways also creates natural follow-on conversations about cash flow management, forecasting, and broader financial strategy.

Payment gateway fees and costs in Australia

Fee structures are often the first question clients raise when considering a payment gateway. Having a clear understanding of the cost landscape helps you provide confident, practical advice.

Most payment gateways in Australia don't charge setup fees or monthly subscriptions for basic usage. Instead, they operate on a per-transaction pricing model. For example, Stripe charges 1.7% plus A$0.30 per domestic card transaction in Australia. International transactions and premium card types may attract higher rates.

Direct debit services like GoCardless typically charge lower per-transaction fees than card-based gateways, making them a cost-effective option for clients with recurring billing models such as subscription services or retainer arrangements.

When advising clients on costs, consider these factors:

• Transaction volume: Higher volumes may qualify for negotiated rates with some providers.
• Payment mix: A client who mostly receives domestic card payments will have different costs from one processing international transactions.
• Surcharging rules: Under Australian Competition and Consumer Commission (ACCC) and Reserve Bank of Australia rules, Australian businesses are permitted to pass payment processing costs on to customers through surcharges. However, the surcharge must not exceed the actual cost of acceptance.
• Net benefit calculation: Even with transaction fees, the reduction in late payments, manual follow-ups, and administrative time often delivers a positive return.

Encourage clients to compare fee schedules across providers and factor in the indirect savings from faster payment collection and reduced reconciliation effort.

How to set up a payment gateway for your clients

Setting up a payment gateway is a relatively straightforward process, especially when your clients are already using cloud accounting software. Here's a step-by-step approach you can follow or guide your clients through.

1. Assess the client's payment needs

Start by understanding how the client currently gets paid and where the pain points are. Consider the types of transactions they process, whether they need one-off payments, recurring billing, or both, and which payment methods their customers prefer.

2. Choose the right gateway provider

Match the provider to the client's needs. Stripe is a strong option for card-based payments, while GoCardless suits clients who rely on direct debit. Many businesses benefit from enabling both to cover a wider range of customer preferences.

3. Connect the gateway to accounting software

If the client uses Xero, connecting a payment gateway is straightforward. Xero's online payment settings allow you to link Stripe, GoCardless, or other supported services directly. Once connected, payment buttons appear automatically on invoices sent through Xero.

4. Configure payment options on invoices

Set up the client's invoice templates to include the relevant payment methods. You can enable card payments, direct debit, or both depending on the client's preferences and their customers' habits.

5. Test and verify the setup

Run a test transaction to confirm everything works correctly. Check that payments are being recorded and matched in the accounting software, and that the client understands how to view payment status and reconcile incoming funds.

6. Educate the client on ongoing management

Walk the client through how to monitor payment activity, handle refunds if needed, and review transaction fees. This is also a good time to discuss how automated payment reminders can complement the gateway setup.

Advising clients on choosing the right payment gateway

Not every payment gateway suits every business. As an advisor, your value lies in helping clients make a well-informed choice rather than defaulting to the most popular option. Here are the key factors to guide those conversations.

• Business model fit. A retail e-commerce business has different needs from a professional services firm on monthly retainers. Card gateways suit transactional businesses, while direct debit works well for recurring revenue models.
• Integration with existing tools. The gateway should work seamlessly with the client's accounting software. Disconnected payment systems create reconciliation headaches and increase the risk of errors.
• Fee transparency. Look for providers with clear, published pricing. Hidden fees for chargebacks, refunds, or currency conversion can erode the cost savings a gateway is meant to deliver.
• Security and compliance. Ensure the provider meets Australian data security standards and handles PCI compliance. This protects both the client and their customers.
• Scalability. Consider whether the gateway can grow with the client's business. A solution that works for 50 transactions a month should also handle 500 without requiring a platform change.

You might also suggest that clients start with one payment method and expand based on customer feedback. This keeps the initial setup simple and allows them to refine their approach over time.

Streamline client payments with Xero

Helping your clients get paid efficiently is one of the most tangible ways to demonstrate your value as an advisor. Xero makes it straightforward to connect payment gateways, automate invoice reminders, and give clients real-time visibility into their cash position.

As a Xero partner, you get access to tools like Xero HQ for managing client portfolios, Xero Practice Manager for streamlining your workflows, and Syft Analytics for deeper financial insights. These tools help you scale your advisory services without adding proportional overhead to your practice.

Join the partner program to start helping your clients streamline their payment processes and build a more efficient practice.

FAQs on online payment gateways

Here are some frequently asked questions about online payment gateways that may come up in your client conversations.

Can small businesses pass payment gateway fees on to customers?

Yes. Under ACCC and Reserve Bank of Australia rules, Australian businesses can add a surcharge to cover the cost of processing card payments, provided it does not exceed the actual cost of acceptance. Advising clients to be transparent about surcharges helps preserve good customer relationships.

How long does it take for gateway payments to reach a client's bank account?

Most payment gateways settle funds within one to two business days for domestic transactions. Some providers offer faster settlement options, sometimes for an additional fee. Direct debit payments may take slightly longer due to the bank processing cycle.

Do payment gateways work with recurring invoices?

Yes. Many gateways, particularly direct debit services like GoCardless, are designed specifically for recurring payments. When combined with recurring invoice features in accounting software, this can automate the entire billing and collection process for subscription-based or retainer clients.

What should clients do if a payment gateway transaction is disputed?

When a customer disputes a transaction, the gateway provider typically manages the chargeback process. Advise clients to keep clear records of invoices, delivery confirmations, and customer communications. Most providers also offer dispute resolution tools and will notify the merchant promptly so they can respond within the required timeframe.

Are payment gateways secure enough for small businesses?

Reputable payment gateways meet PCI DSS (Payment Card Industry Data Security Standard) requirements and use encryption to protect sensitive data during transactions. This means your clients don't need to store or handle card details directly, which significantly reduces their security burden and compliance obligations.