Find out more about Payment Gateway
What is Payment Gateway?
A payment gateway is a software application that functions as a channel between an e-commerce vendor’s website and the bank that processes a buyer’s credit card payment. A payment gateway can also process payments using methods such as debit cards and eCheck (ACH) payments. The main work of the payment gateway is to securely transmit the buyer’s sensitive credit/debit card and bank account data to the issuing bank and other entities involved in the transaction.
Payment gateways send transaction data to acquiring banks and get replies from issuing banks about whether a transaction is accepted or declined. In short, payment gateways assist in effective communication between banks.
Security is a crucial feature of all payment gateways as confidential information such as credit card numbers need to be protected from hackers and frauds. The card associations have stipulated high security standards that must be adhered to by all parties with access to card information including payment gateways.
Most Popular Payment Gateway
Best Payment Gateway
How To Choose The Best Payment Gateway
Payment gateways make it easy to make payments for online transactions. As there are a number of good gateways on the internet, you may be confused about which one to choose. This buyer’s guide helps you out by providing a list of features and factors you should consider to select a suitable payment gateway for your needs.
- E-commerce stores use a payment gateway to receive payments from customers who buy their goods online.
- Small and large businesses that have an online presence and perform sales on the internet use a gateway for secure payment services.
- Individuals use payment gateways for online purchases and transactions.
What are Examples of Payment Gateway Software?
- PayPal Payments: PayPal is a quick and secure way to send and receive money, make an online payment, and set up a merchant account. It also offers business solutions for users to get paid securely on their website, mobile apps, or directly through their email address.
- Login and Pay with Amazon: A fast, easy, and safe way to accept payments online. Companies can enable Amazon customers to simply login and pay using their Amazon credentials.
- Stripe Subscriptions: Stripe powers any subscription model with robust features to reduce churn. You can build and manage all aspects of your recurring billing with Stripe’s APIs.
- Braintree: A simple, robust way to accept payments and enable commerce from anywhere — in your mobile app or online. Braintree offers a security-driven, full-stack payments platform for small business and large companies that enables processing and gateway in one system, plus loads of other features.
- Authorize.Net: Enables e-commerce merchants to accept online payments via credit card and e-check. Its additional services do the job of a full-time employee and help you store data securely, avoid fraud and more.
Types of Payment Gateway Software
Hosted payment gateways
These take a customer off from your website’s checkout page. After a user clicks on the ‘pay now’ button on your website, they will be sent to the payment service provider page. Here the user needs to fill their payment details. After the payment, they will be redirected back to your website to complete the checkout process.
Pro / self hosted payment gateways
For this gateway, you need to ask the payment details from users at your own website. After getting the details, you need to send the gathered data to the payment gateway’s URL. Some gateways need the info in a specific format while others need a hash key or a specific security key.
API / non hosted payment gateways
This gateway allows customers to enter their information directly on the merchant’s checkout page and processes payments using their APIs or HTTPS queries.
Local bank integration
These are similar to hosted payment gateways. The user is redirected to the payment gateway’s website where they need to fill the payment and contact details. After making the payment they are redirected back to the e-commerce website and notification data is also sent with redirection.
Platform based payment gateway solutions
This type offers a platform to e-commerce merchants to sell goods directly from their server. Merchants need to create subscription or products in the provided platform and users are redirected via checkout button to this platform.
Key Features of Payment Gateway Software
Some payment gateways offer multi-currency and international payments as well as an interface supporting multiple languages. You need to check where there are added fees for international and multi-currency payments and whether you need to set up a merchant account in a particular country.
Data security is essential for safe online payments. Make sure the gateway is level 1 compliant with PCI DSS and offers security features such as tokenization. Most gateways also offer fraud protection tools to ensure safe transactions with new parties.
Good quality payment gateways offer reliable support through multiple channels. Do some research and ensure you are able to easily access the support agents anytime. Find out if you need to pay extra for support. Read online reviews about the quality of support offered by various gateways.
Payment gateways usually accept MasterCard, Visa, American Express, and PayPal for online payments. For international payments, check whether the gateway accepts local credit cards beyond MasterCard, Visa, and Amex.
Benefits of Payment Gateway Software
You can use payment gateway software to do the following:
- Accept online payments for your e-commerce business.
- Accept multiple payment methods and currencies.
- Process payments safely by ensuring the security of payment details.
- Avoid unauthorized payments with fraud protection safeguards.
- Quickly handle customer refunds and returns.
Mobile apps are replacing countertop checkout
Consumers are using their mobile phones to access cloud apps to checkout inside the shop and to pay for things before they step inside the store. Savvy brands like Starbucks, Taco Bell, Domino’s Pizza, Target, and Kohl are utilizing this trend to offer mobile payment apps and have seen a boom in their sales.
Faster and safer payments
Many countries have implemented systems to facilitate faster payments. Beyond speed, payment gateways and apps are becoming more efficient and flexible. They are ensuring their systems meet security, compliance, and risk management regulations for safe online transactions.
Contextualized commerce is driving payments innovation
Payments are enabling the different digital experiences consumers engage in every day. Consumers spend many hours on the internet every day for different tasks. Companies are tracking their online behavior and habits to influence and trigger purchases. They are payment-enabling impulse purchases in innovative ways.
Chargebacks and fraud
Payment gateways need protection against data theft and fraudulent misuse to ensure secure transactions. They need to use fraud-monitoring tools like purchase tracking, validation services, and risk management to detect fraud before it happens. Chargebacks are expensive and can damage the reputation of a gateway. Therefore, they need to use effective customer service practices to reduce or eliminate chargebacks.
It can be difficult for some gateways to integrate with other platforms which can result in processing delays, expensive fees, and lost transactions. Payment gateways need to ensure smooth technical integration with other systems to offer easy and secure transactions.
International payments can be slow, expensive, and inefficient. Payment systems need to tackle this challenge and ensure fast and secure cross-border transactions and payments by managing the costs and risk more effectively.
List of Payment Gateway Software Companies
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FinancesOnline makes use of our innovative SmartScore™ method to test all the services in the Payment Gateway category to help you decide on the best possible software. It pays attention to the following elements: individual features, collaboration capabilities, custom elements, integration, user friendliness, help & support, how secure a software is, mobile support, scores in other media. At the moment, PayPal Payments Pro is the leader in this category and we gave it the highest score in our tests. After extensive testing it received the best results among its competitors and we strongly suggest that you consider it as one of the choices for your company.
A summary of overall user satisfaction with the products in our Payment Gateway category evaluated with our unique algorythm that gathers client reviews, comments and opinions across a wide range of social media sites to help you make an informed purchase decision.
Each vendor in the Payment Gateway category will provide a different group of pricing packages for its product and each plan will include a different group of features. Below we list the general pricing for the most affordable package available for each service. Keep in mind that advanced features may cost extra.
A summary of what kind of devices and operating systems are supported by the listed B2B tools in the Payment Gateway category, including mobile platforms and web-based solutions.
Learn which languages and geographies are supported by the popular B2B apps in the Payment Gateway category, including services intended for international markets and created for multi-cultural groups of employees.
Learn what pricing plans are provided by the vendors in the Payment Gateway category to see which one matches your business preferences and expenses best. Note that specific software can offer free or freemium accounts for you to try out first.
A brief look at what groups of customers a selected B2B platform in the Payment Gateway category aims for, from small businesses and non-profits to large enterprises.