When I first started out in e-commerce I had a merchant’s account with my bank that allowed me to process credit card orders. The only downside was the monthly fee, but while I was processing lots of orders it was easy to justify.

A change in direction meant the volume of business I was putting through my merchant account fell. At the same time I noticed that more people were choosing to pay via Paypal, the online payment system that today is part of the eBay empire. So when my merchant account contract came up for renewal I decided to leave it behind and use Paypal to process my online payments.

It worked fine, especially with those who already used Paypal. Those that didn’t sometimes needed some help, and no doubt I had a few abandoned shopping carts along the way, but it did the job despite it being seen as a poor man’s solution to e-commerce in some circles.

Today I still use Paypal to process credit card orders. Contrary to urban myth, your cusomers don’t need a Paypal account to use it and indeed the recently revised payment page now has payments without a Paypal account as the dominant feature (a huge improvement over past payment pages where you had to scroll down to pay without one).

And I’m obviously not alone. Paypal is now the preferred payment method when buying online for 35% of UK shoppers, a figure boosted by its integration into eBay. Across Europe as a whole, the figure is 23%.

But as of today, in the UK at least, there is a new payment processing kid on the block.

Google Checkout.

Launched in the USA last summer, Google Checkout seeks to offer an alternative to both Paypal and other online processors.

According to Google, it offers a “fast, convenient checkout process” where customers who use Checkout can buy from you quickly and securely, using a single username and password – and you can use Checkout to process their orders and charge their credit or debit cards. It hopes to attract merchants like you and me with its fraud prevention tools that should stop invalid orders from reaching you and its Payment Guarantee policy to help protect you from chargebacks.

It offers shoppers similar security guarantees.

And to get it off to a flying start, it is also offering sweeteners to both buyers and sellers. Sellers are being offered free card processing until the end of the year while buyers are being offered a whopping £10 off all orders over £30 paid for through Google Checkout.

I’m hoping to add it to my sites this weekend - buy now buttons can be set up and added to your website in no time at all - and will let you know how I get on in due course.