> What alternative services are there to PayPal that offer the ability to act only as payment processors that get called via an API?
What you're looking for is called a Payment Gateway. The defacto Ruby library for utilizing them is called Active Merchant (http://activemerchant.rubyforge.org/) and it includes ~30 different companies. If you're looking for a list of all the big ones, that's a good place to start.
I've personally used Authorize.net & Paypal before. Braintree is the company name that gets thrown around in 37signals' circle.
Good point. I suppose this is more competing with Paypal's standard payments (free), as opposed to Paypal's Payments Pro ($30/month). Although even with the free Paypal account the user can still pay with a CC, on paypal.com.
What alternative services are there to PayPal that offer the ability to act only as payment processors that get called via an API?
Authorize.net is the 800 lb. gorilla, and I believe 2checkout offers a similar service.
Chargify has yet to send me an email for their beta (which I've signed up for several times). They don't even bother to send an email acknowledging my interest. Its a great looking website and an interesting value proposition. When it gets ready for prime time, I'll try it if I haven't already moved on to a solution thats actually available.