Anyone in ecommerce for more than a few years will tell you that adding more payment options will increase your user base. However, there isn’t one specific payment solution, short of accepting credit cards, that will dramatically increase your revenue stream. Typically, depending on the site itself, adding American Express (NYSE AXP) will increase your processing by as much as 10%, adding Discover Card (NYSE DFS) will probably tack on another 2% to 4% and depending on the service type, and Paypal may help with as much as 20% not to mention Google Checkout and it’s potential 10%.

The question, however, is have we reached a point of diminishing returns? Additionally, have we passed that point and gotten into a situation where so many payment solutions are not only confusing the end merchant but causing fraud rates to increase? There has definitely been some talk about this matter recently in the blogosphere but I think truth be told, people are missing the bigger picture.

Payments used to be the holy grail at one point. There was some level of confidence in knowing that the person on the other end of that third party payment service was a well known, established, and reputable company. While we all have to start somewhere, you’d at least like to know that there are a few dollars behind the company that you are working with. While there are several laws and regulations that do in fact govern the payment sector, it’s really become the wild-wild west of the industry.

There are, in fact, many reputable third-party billing solutions but the reality is that the space is getting a bit crowded and unfortunately, government hasn’t been able to do much about the lack of all the companies properly following the regulations. Take the case of Intabill, a third party payment solution, one of which I’ve received more complaints about recently than any other. Now I have it on good authority that while they try to appear not to be a U.S. company, in fact, the CEO spends much of his time in the United States.

Ultimately, I know there are a lot of great solutions out there, risk tools, management tools, and what have you, but the reality is that with data security becoming such an important factor, I think it’s time the government really step in to regulate and lay down the law, and these alternative payment solutions really may be a good place to start.