For companies, selling online is not an option, it is a necessity. Online payment gateways are an essential fintech solution that allows businesses to process online payments securely and efficiently.
Confirm customer and merchant transactions.
Some of the popular payment gateways used by businesses are PayPal, Skrill, Stripe, and Braintree. Additionally, big companies like Amazon and Facebook have also started their own payment processing gateways.
Types of Payment Gateway
There are 3 types of payment gateways you can use for your business.
Hosted gateway
A hosted gateway redirects your customer to a different web page where they enter their payment information. Once the transaction is complete, the customer will be sent back to your web page to complete the purchase. This is where the final order is processed.
This method is easy to implement as it does not require the merchant to be PCI compliant. The trader also does not need to store any financial data. Control of the entire transaction is in the hands of a third-party payment partner. This reduces the risk of storing confidential information on the supplier's website. An API redirects the user to the gateway.
This method is recommended for small businesses that do not want to deal with data security and compliance issues.
Direct Post Gateway
This payment method allows the customer to carry out transactions without leaving the merchant's website. Transaction information is collected from the customer and sent to the gateway. The merchant does not store any information. All information is stored by the browser. It sends the information to the gateway for transaction approval through HPP messages via JSON string.
An API connects the payment gateway to the website. This method does not require the merchant to be PCI DSS compliant since it does not deal with financial data.
Unhosted gateway
In this method, no third party is involved in processing the transaction. Instead, the merchant handles payments themselves and is responsible for storing (and protecting) data and verifying transactions.
One of the main benefits of implementing this method is that the merchant controls the entire scope of the payment processing and transaction. The customer does not need to leave the website. This improves brand recognition and user experience. The merchant can also easily customize the payment system to meet the business needs.
However, there are some problems. This method requires the merchant to be PCI DSS compliant. They are also responsible for maintaining the software. However, this method is highly beneficial for medium and large businesses that want in-house payment processing.
Factors to Consider When Selecting a Payment Partner
Choosing a suitable payment partner for your business is essential. Since there are so many options to choose from, here are some factors to consider.
1. Gateway location
Before choosing a payment provider, you should first consider the provider's geographic region. Is the provider licensed to operate in your country? Can your target audience access these payment providers seamlessly?
You also need to check the types of currencies, conversion rate and payment frequency. Since many companies serve consumers around the world, the payment provider must be able to convert money into local currency.
2. Payment method
This is also a key factor when deciding on a payment gateway. Most customers use credit and debit cards to make payments.
But payment partner services should not be limited to just popular payment methods. They must offer other payment methods, such as net banking, e-wallets and vouchers. Additionally, they need to allow customers to choose a payment method based on their preferences.
Cryptocurrency is also gaining popularity as a form of payment. Be sure to check with your provider to see if they accept popular cryptocurrencies.
3. Accessibility
You should always keep accessibility in mind when selecting a payment gateway. It must be cost-effective to implement and operate your payment solution. Therefore, you should always consider costs such as purchase fee, subscription fees, payment processing fees, and service renewal fees before deciding on a payment partner.
Additionally, check if your payment partner limits the number of transactions they can process per month to avoid paying late fees.
4. Support
You need to check aspects like transaction speed and overall experience before selecting a payment provider. It is important to experience the entire process from the customer's point of view. If there is a problem in the payment process, customers will leave the checkout page. Another thing to note is how quickly the customer service team responds to your queries when you raise an issue.
5. Security
Security is an extremely important concern when selecting a payment partner. Therefore, the gateway you are using to store financial information and process payments must be PCI-DSS compliant. It should also have features like OTP, fraud detection, embeddable checkout, and payment screening.
A good payment partner must also take care of controlling and minimizing risks . They should also be responsible for other aspects of payment processing, such as automatic payments, cross-platform support, and dispute handling.
In short
Payment partners are an important part of an online business. A good payment partner improves customer satisfaction and ensures brand loyalty. They are essential for the growth and proper functioning of a company.
It is highly recommended that online businesses accurately research their business requirements and find a payment gateway that meets these needs. Implementing an efficient custom payment platform software development will result in more leads and increased business.
