Adoption
of digital payment methods chosen over cash or other modes of
transactions is on the rise.
Digital
finance and payment methods are powerful tools of improving sales and
business for e-commerce merchants.
Unfortunately
a lot of merchants are unaware of such advantages and only 40% of
merchants are aware and benefiting from this facility.
This
article breaks down the significance, uses, and suitability of an
online
payment gateway
for
potential or existing online retailers. Read further to learn how
payment gateways work and how you can choose the right payment
gateway for your business.
What
is a payment gateway?
An
online
payment gateway authorizes
transactions for e-businesses, online retailers, or traditional brick
and mortar stores. It is used to transfer information between a
payment portal and an acquiring bank. Payment gateways encode private
information such as credit card details, to keep the information
transfer between a customer and merchant secure.
How
do payment gateways work?
A
payment gateway first pulls information from a credit card
transaction, encrypts this information, directs this information to
the credit card processor, where the transaction is finally approved
or declined. This is a seamless process between you and your customer
via your shopping cart and a secure connection.
Why
should I use a payment gateway?
Payment
gateways are vital for keeping online transactions secure. They can
be integrated with most websites and shopping carts online, to
streamline online credit card processing. A shopping cart is usually
used before the payment gateway. This allows customers to choose
items they want to purchase and at the checkout, the shopping cart
totals the items, adds tax and shipping and collects customer’s
shipping and billing information.
How
do I choose the best payment gateway?
Here
is a checklist to finding the best payment gateway for your
e-business:
-
Budget of payment gateway
-
Time of accepting payments
-
Time of receiving revenue from sales
-
Security of the gateway
-
Cards accepted
-
Compatibility with existing integrations
We
hope this article was helpful in answering some doubts you may have
had around using an online
payment gateway.
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