Here’s what we’ll be finding out about payment gateways.

What is Payment Gateway?

A payment gateway is a transaction medium between a merchant and a consumer. It may be on an offline outlet or online website or through a payment service like UPI, NEFT, RTGS. There are four parties that involve in the payment gateway process: the customer, the merchant, the issuing bank, and the receiving payment or acquiring bank. It is an easy and simple process.

The customers transfer their personal and financial information between the merchant and customer by swiping their credit or debit card or processing their bank account information. Security layers encrypt this exchange and prevent sensitive information from falling into the wrong hands. It determines the number of funds in the customer account used for the purchase and, accordingly, notifies the approval or decline of the transaction.

Payment Gateways vs Payment Processors: What’s the difference?

We have explained above how the whole payment process works. Hence, it requires two basic components: payment gateways and payment processors to be successful and secure. Following are some differences between the two:

1. The payment gateway receives the customer’s information and forwards it to the payment processor for verification through the card system. Payment processors relay the data and verify that the card details are valid and secure.
2. Payment gateways inform customers and merchants of approvals and declines of transactions. Through data transmission between issuing and receiving banks, payment processors communicate the response to the payment gateway.
3. When transferring data to the payment processor, the payment gateway needs to encrypt and certify it as an ISO 8583-compliant platform. Thus, payment processors have higher development costs and longer development times than payment gateways. Payment gateways need a simple SSL encryption.
4. Payment gateway is more economical regarding certification and development costs, making it more suitable for startups and small businesses.

Three Types of Payment Gateways

With the advancement of technology, many businesses have moved from direct bank transfers to a more convenient, secure, and credible way of accepting payments using a payment gateway. Here are some of the most common types of payment gateway:

Hosted payment gateways

Using this payment gateway, when a customer clicks the ‘buy’ button on the merchant website, the system redirects the customer to the payment service provider’s website. Now, the customer needs to enter the relevant card or bank information. Upon confirmation, the customer then gets back to the merchant’s website to receive their order confirmation message. As a way of ensuring customer confidence, merchants can include their logo on the payment page.

Self-hosted payment gateways

This type of payment gateway, also known as pro-hosted payment gateways, involves the client providing card or bank details on the merchant’s website. Customers may need to submit information in a specific format. Upon submission, the data is then transmitted to the payment gateway’s URL. As it is on the merchant’s website, it makes the customer experience better.

API hosted payment gateways

The customer inputs their credit card or bank details on the merchant’s website in this payment gateway. Instead of directing to the URL page, the payments are made via HTTPS queries or APIs. The merchants have complete control over the whole purchase process. However, to provide this facility, merchants must possess SSL certification and DSS compliance.

Considerations for Choosing a Secure Payment Gateway

A reliable payment provider is critical for merchants to provide a smooth customer experience and increase traffic to their offline or online portals. Today customers can easily download the payment service providers’ app on their phones. One such example is the Bharat QR code in the android app.

Here are some things to consider when choosing a payment gateway:

• Businesses must consider how many payment methods and currencies they wish to include in their payment process. The more payment options available, the more comfortable and satisfied their customers will be.
• To provide good customer service, the speed of the entire sale process is essential. This includes the transfer of funds from the customer’s account to the merchant’s account.
• Another aspect to consider is the transaction fees and service costs. Fees depend on the volume of transactions, frequency of transactions, and many other factors.
• Merchant accounts are a must for some payment gateways. In comparison to other options, they charge lower transaction fees. Also, they are considerably more safe and secure, especially for large volume businesses.
• Payment gateways must be 3D secure and compliant with PCI data security standards-the highest level of security.

Conclusion

After reading the above article, you should have a fair idea of what a payment gateway is. Analyze your business needs and then choose the right payment gateway. Today, payment gateways like PayU come with a variety of web and mobile applications. It is a complete payment gateway solution with low processing fees, low commissions, and enhanced security. Build your automated payment process with PayU.

The post Payment Gateway: Definition, Types, and All appeared first on PayU Blog.

A payment gateway for eCommerce inspires trust in the customers to use an online business or an eCommerce store to fulfil their shopping needs without dreading an attack by hackers or phishing due to their card information being stolen, ensuring a hassle-free experience. The success of an online business, brick and mortar business, and especially Ecommerce stores depends on the backing of a reliable and reputable payment processor. A payment gateway acts as an intermediate agency and liaises between customers and eCommerce stores in receipts of payments and processing of customer refunds. With a few clicks, data is sent across multiple parties.

Functions of a payment gateway for eCommerce

Following are some of the most important functions of a payment gateway for eCommerce:

• eCommerce stores, online businesses, and brick and mortar stores easily and seamlessly access customer payments.
• Preserve the sanctity of customer information and the money paid through the system
• Reputable and reliable payment gateways prevent fraud and misappropriation of funds and gain the customer’s trust by providing a deep level of encryption.
• A payment gateway should minimise the abandonment of shopping carts due to lack of payment options, technical issues, or poor in-store experience.

7 Features to look out for when choosing a payment gateway

Every payment gateway comes with many features, a few making them unique from the others. However, a few standard features of every payment gateway that you should look out for when choosing its eCommerce success are as follows: 

1. Locally supported in your country: Even if the payment processor has global operations, it must seamlessly make available the facility to pay in your country in the local currency to your customers.
2. Encryption: The payment gateway tends to encrypt data between the user’s browser and the server of the retailer. This exclusive private data is available for use between the seller and buyer.
3. Initiation of the request: The request for authorisation takes place when a financial institution or a credit card company agrees to go forward with the transaction data.
4. Fulfilment: The payment gateway green signals the website to go ahead with the transaction when this authorisation is received. This process of authorisation and processing the transaction should be seamless.
5. Payment methods: Analyse whether the payment gateway redirects the payment, allows the check out to happen on the site with the payment processed at the back-end, or makes on-site payments happen, allowing you to retain more control.
6. The payment process: When customers make a purchase transaction, they enter credit card or debit card details. The payment gateway should use a Secure Server Socket layer encryption between the browser and the merchant’s web server. The merchant redirects the transaction to the payment gateway, which also has the SSL encrypted connection to the payment gateway’s secure server. The payment gateway converts the message, and the card information is passed on to the credit card issuing company to process the authorisation request. The transaction can be approved or denied. If approved, the processor receives the authorisation request, and the merchant processes the order and consummates the transaction. The merchants receive the money at their bank within one to 2 days.
7. Economical charges and fees structures: Analyse the complete list of charges deducted for every transaction. In addition, also look at fixed charges, if any. Also check out contracts, cancellation policies and surcharges, if any.
8. Multiple payment methods for the customers’ convenience: What payment methods are supported by the payment gateway? The different payment methods include credit card and debit card payments, prepaid card payments, bank transfers, e-wallets, and cash and mobile payments.
9. Exempt businesses that it doesn’t cover: Some payment processors and gateways only support socially responsible businesses. You need to check that all aspects of your eCommerce business are acceptable to the payment gateway.

Best payment gateways for eCommerce websites in India:

With an impressive conversion rate of 12% and being a global brand, PayU is one of India’s largest payment gateways for eCommerce. It is an impressive clientele list of eCommerce companies in India, including Flipkart, Jabong and Snapdeal. This payment gateway for eCommerce websites covers various operation aspects, including a risk management system, mobile optimised payment Page, multicurrency gateway, IVR payment, store card feature, and payment analytics.

Key Takeaways

In summation, while selecting a payment gateway for an eCommerce website, you need to ensure that:

• The payment gateway for the Ecommerce website accepts all types of cards /payments to maximise convenience for customers.
• Global shoppers may face higher charges.
• Ensure that the encryption of your payment gateway for your eCommerce website offers the highest level of protection against data breaches, customer mobile payments issues, and any malware.
• Stack payment gateways make it easier for your customers and offer multiple options.
• Rationalised fee structures to understand the ultimate impact on your bottom line due to the per-transaction fee structure of payment gateways for eCommerce platforms.

Final Words

PayU is a multinational payments gateway for eCommerce platforms and enables priority settlements of customers’ payments. With an impressive list of clients, including Amazon, Flipkart and other eCommerce stores, PayU, the payment gateway for eCommerce stores, is a one-stop, integrated solution for all your payment processing needs.

If you want help to access the proper technology and obtain an on-demand settlement of customer payments for your eCommerce store,

Visit us, and let us solve all your eCommerce worries! 

The post How To Select The Best Payment Gateway For Your E-Commerce Website? appeared first on PayU Blog.