In the competitive market landscape, eCommerce takes center stage, offering a compelling business avenue. When it comes to marketing goods or services online, more than a mere web store will be required; including a secure payment gateway is essential to ensure customers can conduct their transactions confidently. Let’s explore the world of e-commerce payment gateways and learn the criteria for choosing the best option for your company.

How does a payment gateway work?

Online transactions via payment gateways take place in a few moments and comprise several steps. First, the customer chooses the products or services he intends to purchase on the merchant’s website and adds them to the cart. Subsequently, when proceeding to the checkout to finalize the purchase, enter your personal and payment data in the appropriate form, choosing between credit, debit, prepaid, or App wallet cards.

In the current process, the payment gateway deploys state-of-the-art encryption techniques to secure sensitive payment data, which is subsequently transmitted to the bank for validation. At this juncture, customers may undergo redirection to an external payment processor’s page for additional transaction verification or may opt to remain within the eCommerce framework, contingent upon the specific characteristics of the employed gateway.

Upon obtaining authorization, the payment gateway expeditiously informs the merchant and customer about the successful payment. Ultimately, the payment gateway facilitates the transfer of funds from the consumer’s account to the merchant, culminating in the customer’s return to the eCommerce platform for a comprehensive confirmation, including shipment details for the purchased products.

In short, the parties involved in an online payment transaction via a payment gateway are:

Consumer: who chooses the products or services he intends to purchase and proceeds to the checkout to finalize the order;

Issuing bank: i.e., the financial institution that issued the credit or debit card to the consumer;

Acquiring bank: i.e., the merchant’s financial institution, which deals with the payment authorization process;

Issuer processor: it is the technological partner of the issuing bank that handles transaction management;

Credit circuit: such as Visa, Mastercard, and American Express;

Buyer’s processor: it is the technological partner of the buying bank that is responsible for the payment gateway. This platform takes care of the encryption and transmission of payment data.

How do you choose the best payment gateway?

Different types of online payment gateways differ in functionality, features, and market target.

  • To choose the best payment gateway, in order to simplify checkout, reduce abandoned carts, and increase the sales of your eCommerce, it is important to consider several factors such as:
  • The number of transactions you intend to process each month;
  • The number of cards accepted (credit, debit, prepaid card);
  • The possibility of offering customers alternative payment methods to credit cards such as PayPal, Apple Pay, and Google Pay;
  • The compatibility of the gateway with the eCommerce website must guarantee a fluid and intuitive purchasing experience, both from desktop and via mobile devices;
  • The level of security that the payment gateway is able to guarantee during transactions. It is essential to rely on a payment system that respects all the highest security standards and complies with the PSD2 regulation and the General Data Protection Regulation, better known by the acronym GDPR, to protect customers and your business best. Among the most important certifications is the PCI-DSS (Payment Card Industry Data Security Standard), which allows the gateway to store payment data legally and securely in order to optimize the checkout process in case payments are recurring.

In conclusion, selecting the right payment gateway is a crucial decision for any eCommerce business. Factors such as transaction volume, card acceptance, alternative payment methods, website compatibility, and security standards should guide your choice. Additionally, for seamless retail operations, consider integrating with BillMade POS, a leading retail billing software solution that streamlines your business processes and enhances customer experiences. Make the right choice, and your eCommerce venture will thrive in the competitive online marketplace.

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