If you accept online payments through credit/ debit cards, then you require a payment gateway that allows your business to accept payments from its online customers.
What is Payment Gateway?
With the help of a payment gateway, businesses can easily accept payments from customers online. It allows the customer to initiate a transaction and get informed whether the transaction is successful or not.
How Does a Payment Gateway Work?
Payment gateways are the rails passing the information from the merchant to the issuer and then again to the merchant account. The information that they pass is a request to the card issuer, who can either approve/reject the transaction based on the customer’s bank account. Later the payment gateway passes this approval or declines back to the merchant.
Payment gateways are generally used for card payments, but they can also facilitate various alternative payment ways. Based on the sensitivity of the information being transmitted, an online payment gateway secures customer and financial data. They use different kinds of technologies to do this including network tokenization and encryption as per the standards like PCI compliance.
What is Network Tokenization?
Network tokens are different digital identifiers considered to supply a tokenized value rather than the primary account number (PAN) in all parts of the payment chain. These tokens replace sensitive card data, such as the account number and expiration date written on the front of a card used for payment, without exposing the actual account details.
How does tokenization work?
· A customer enters their account number, security code, and other required payment details.
· The merchant’s payment service provider asks for a network token from the card scheme.
· The card scheme shares the network token with the issuer of the card.
· The card scheme shares the network token with the merchant’s online payment service provider.
· The merchant processes the payment with the help of the network token
How does a payment gateway affect the overall customer experience?
Checkout plays a crucial role in customers’ experience on your site. Keeping each part of this experience as seamless as possible will prevent cart abandonment and sale loss. That’s why payment gateways are being used as technology, and consumer expectations change. Thus the online payment gateway providers are adapting the way their customers expect.
When selecting a payment gateway, one needs to consider integration methods and global functionality for their checkout page.
How to choose an online payment gateway
The factors that need to be considered while choosing or changing a payment gateway include.
1. Compatibility with your website, app, and physical point-of-sale terminals
Many gateways are strong in e-commerce, while others are strong in traditional face-to-face sales, and others in both. A few gateways have developed features for targeted industries, geographies, or business models. Make sure that the gateway provider you have shortlisted is a good fit for the way your business trades.
2. Integration
In case your business already has relationships with other suppliers, calculate the overall costs or changes to equipment, online payment pages, etc. that are needed to integrate with a prospective gateway.
3. Speed of settlement
Quiz a prospective gateway on settlement times, additional whether funds are settled gross or net of fees and charges, as it will impact the overall cash flow.
4. Card and local payment types offered
Nations adopt their own preferred ways of paying and being paid. Make sure a prospective payment gateway provider caters to these, based on the target customers as well as where and how you trade.
5. Fee structure
Gateways will have a range of fees and charges for things such as set-up, authorization, and data security. It is important to understand the fully loaded costs and contract terms to ensure effective comparisons between gateways.
6. Security certifications
Check the security policies, procedures, and certifications of a prospective online gateway provider. It is important that they must have the necessary accreditations to store, process, and transmit crucial financial data of the customers. Any organization which is into processing, transmitting, or storing card data must be PCI compliant, make sure you are working with some who is certified.
7. Value-added services
Look at the other services available from a prospective gateway to make a better decision. Consider factors like data analytics, fraud, and risk management.
8. Support available
Ensure that you are comfortable with the kind of support you will get from a prospective gateway. For instance, dedicated technical and customer support in your time zone and language.
Part of a full payments stack
Payment gateways play an important step in the payment process and in the digital world. Once the payment gateway has collected all the customer’s card information, it will then be up to the payment processor to use that information to get in touch with the customer’s bank and the merchant account so that one can be debited while the other can be credited.
Looking for a unified payment solution that takes care of both these steps and the others in the payment lifecycle helps ease the entire process and deliver a frictionless customer journey. Choosing a partner that operates end-to-end gives an assurance that all data comes from one source so that transactions can be processed faster with less downtime and more accuracy.
PayCaps- your payment gateway provider
PayCaps is one of the renowned payment gateways, an acquirer, and processors offering an end-to-end solution. The transactions done through PayCaps can be processed easily with less downtime and more accuracy, assisting merchants in improving their acceptance rates and driving overall growth.
To know more about the payment lifecycle, discover what PayCaps has in store for its merchants.
