The majority of business-related websites utilize some type of payment gateway in order to perform transactions. Let’s, therefore, take a closer look at the basics of online payment processing and how to choose the most appropriate platform.
What is a Payment Gateway and How Does it Work?
From a simple perspective, a payment gateway is simply a means by which customers can transfer funds to an online business. We can think of these portals in a similar manner to point-of-sale (POS) systems found within physical stores.
While there are different types of gateways, their functions are quite similar. A customer will first enter in his or her payment details. Transfer methods (such as a bank account or a credit card) will then be selected. Once this information is complete, the transfer is performed. In most cases, these POS systems will send a confirmation to the client.
The Different Types of Payment Gateways
The world of virtual payment processing has evolved incredibly in these modern times. For this reason, there are a host of different payment gateways for businesses to choose from. Let us now take a look at three of the most common online POS systems.
Hosted Payment Gateways
As the name suggests, a hosted payment gateway relies upon a third-party provider. Once a client has entered the appropriate details, this information will be sent to a separate checkout page. Hosted gateways are popular solutions for businesses that lack sufficient in-house expertise.
Self-Hosted Payment Gateways
This next type of payment processing involves the use of a proprietary in-house gateway. Self-hosted gateways are unique in the fact that they can be molded around the needs of the business in question. Additionally, fewer fees are associated with such a merchant account.
API-Hosted Payment Gateways
API is an acronym for an application programming interface. API-hosted gateways allow customers to supply their payment details directly to a merchant checkout page. Online payment processing will thereafter be confirmed via an HTTPS or API query. Also, the rather simple interface of an API payment gateway is another rather attractive quality.
What to Consider When Choosing an Operator
There are several factors to consider when selecting the most appropriate payment gateway. Ultimately, the main goal is to obtain a straightforward payment processing method that expedites transactions while ensuring a seamless end-user experience. Let us examine four relevant factors.
Geographical Availability
First and foremost, some payment gateways may not be supported in specific regions of the world. This is obviously important when dealing with international customers. It is, therefore, crucial to ensure that payment processing will not be denied to certain geographic locations. Simply stated, always check to see if the gateway is limited in terms of the scope of its operations.
Accepted Payment Methods
Many gateways will temporarily re-route funds to a merchant account during the transaction process. Unfortunately, some accounts do not support certain types of payments. As a result, this can have a massive impact on the end-user experience and it may even result in a lost sale. Therefore, always determine what payment solutions are supported. The best gateways are extremely flexible with these options.
Security
Of course, safety is very important in this day and age. Any payment gateway or associated merchant account must therefore be equipped with the latest security protocols. Examples include SSL (secure sockets layer) encryption, tokenization, and two-factor authentication via a secondary device (such as a mobile phone). It is always best to avoid a payment gateway that cannot demonstrate such features.
Customer Support
There may be times when customers have a question in regard to issues such as billing details or transaction fees. So, a payment gateway should always provide adequate levels of client support. Methods include a dedicated telephone number, a live chat widget, and an email address. Furthermore, these solutions should be simple to find and available on a 24/7 basis.
Compatibility of the Chosen Gateway With Your Growing Business
We can now see that there are a variety of payment gateways to consider well in advance. Having said this, it is always important to choose one that is compatible with the needs of your enterprise. It is therefore a good idea to examine a handful of the most popular solutions. Many of these also offer demonstration accounts as well as in-depth tutorials. When in doubt, it is wise to speak with a customer service representative. He or she will be able to answer any additional questions that you may have.
Conclusion
Online payment processing represents one of the core facets of any modern business. As these point-of-sale systems continue to advance, even more, cutting-edge solutions will be offered. Selecting the most appropriate bundle is therefore crucial if you hope to enjoy success well into the future.
