22/06/2021

Online payment gateways: a complete guide

By Mariana Almeida Marques

Every business, no matter the size, needs an online payment gateway to take electronic payments from their customers. Because business’s needs are regularly changing, every company wants a gateway that fulfils various, changing requirements.

What is an online payment gateway?

A payment gateway is a software that transfers the customer bank data from the customer’s bank to the payment processor. When customers physically swipe or wave their card (for contactless transactions) or enter their details online, their data is collected by a payment gateway and securely passed on to a payment processor so that the transaction can continue.

Payment gateways are the first point of contact between the Issuing bank and the rest of the players involved in payment processing. They are a key part of payment transactions because they encrypt the customer’s details, making them much more protected from being hacked or stolen. Encrypted numbers are impossible to identify.

A payment gateway is also responsible for notifying the customer and the merchant that the payment was authorised and, later, that the payment was settled. There are differences between gateways and payment processors, so it’s important to distinguish these two.

Payment gateways

What are some of the best online payment gateways? 

Each payment gateway is different, but some offer more functionalities than others. You may have heard of Payflow (the payment gateway of PayPal), Braintree and Worldpay, the most used gateway in the UK. Others include Amazon Pay, Shopify payments, Sage Pay, Payment Express, TrustCommerce and Stripe. As you can see, there are various online payment gateways available in the market.

Companies like Braintree, Stripe and PayPal are actually Payment Service Providers with their own payments gateway and merchant account. This means that you don’t need to partner with a gateway and PSP separately if you connect to one of these PSPs, which may save you time and money. Some PSPs offer connectivity to a selected number of gateways, so your options may be limited.

Should I set up my own online payment gateway?

Building your own online payment gateway is a viable option, but it may have more cons than pros. The costs of developing and maintaining a payment gateway of your own are usually higher than the monthly fees you pay to an external company. You would also have to invest a lot of funds in security technology and certifications- third-party gateways already have their own security software to comply with regulations. Considering the resources, costs and time that a third-party gateway can save you, integrating a payment gateway is a more efficient option.

Online security

What to consider when choosing an online payment gateway

Costs and Fees

If you integrate an online payment gateway individually, there will be setup costs involved aside from the regular fee per transaction and set monthly admin fee. Consider the monthly volume of your online payments, as PayPal, for instance, charges more for lower volumes.

International payments

Though most gateways support a wide range of currencies, it is still worth checking the list of currencies they support. You will need a gateway that accepts all currencies of the countries your business operates in. Choose a gateway that also offers an interface with multiple languages, for better customer experience.

Security

This applies to any player in payment processing or any third-party you partner with. The most relevant regulation to look out for is PCI DSS, so make sure to choose a gateway that is PCI-compliant. You can also check for additional security functions such as screening tools and data monitoring.

Hosted payments

Redirecting a customer from your website to a hosted payment gateway makes it easier to comply with regulations. You won’t have to handle any bank details directly on your website as instead, these details will be handled and stored on a separate hosted page provided by your gateway.

This means when your customers proceed with a purchase, they will see another page opening where they can continue the purchase and insert their details. Hosted pages can, however, slow down the payment, which may affect your customers experience. It is up to each company to decide whether hosted payments may or may not be more beneficial for their business.

There are many more components to take into consideration, particularly the types of payments that gateways can accept, the level of customer support they offer and the waiting times for receiving the funds.

How Imburse can help

The great thing about choosing which online payment gateway to connect with is that this isn’t an irrevocable decision. You can change gateways or connect to multiple ones depending on your business’s needs. However, integration processes are incredibly long and require high financial investments and a lot of resources.

By connecting to Imburse, you can connect to all payment gateways available worldwide, including those mentioned above, as well as all payment processors and technologies. Avoid time-consuming single-integrations and enjoy the freedom of adapting to your customers and business’s needs at any time without complications. Reach out to us below if you would like to know more.

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