Using payment gateways ensures faster transaction, easier payment procedures, and enhanced security
Payment gateways are getting more popular as e-commerce is becoming essential in the present day.
They provide greater security against hackers and scammers. People who use traditional payment methods for their e-commerce instead of payment gateways are more likely to be the victim of frauds and hackers. Using gateways provides great safety nets that fend off attackers.
Let us find out what Payment Gateways are, and how secure they are.
Payment gateways are payment procedures for e-businesses, online retailers, traditional brick and mortar, or bricks and clicks, that are made through a credit card authorized by an e-commerce application service provider. An example of a gateway will be PayPal.
According to the latest payments industry insights payment gateways, payment service providers, EMIs, and Card Networks are slowly paving the way for a more digitized world.
Payment gateways work in three simple steps:
To secure the data between seller and buyer, the gateway encrypts everything between the user’s browser and the retailers' server.
Now, to begin the payment, an authorization request is made. The authorization request will only appear if the payment processor gets approval from the credit card company.
After the authorization is complete, it will allow the website to complete and fulfill the payment procedure.
In general, there are three types of payment gateways. A brief description of these types are given below-
An offsite gateway is a method similar to a redirect payment gateway. In an offsite gateway, you are redirected to a different page as well.
But this is not a page administered by PSP. Instead, another third party page administers them. The customers are redirected to an offsite-payment plugin form, which they have to fill up.
After the necessary details are given, the third party verifies the payment process and when all is found valid, the customer returns to the main e-commerce URL.
But as the payment page is created and maintained by a third-party payment service provider, the main e-commerce site cannot customize it. The other problem is, unlike PSP, these third-party websites often do not redirect the customer to the original e-commerce website.
So there is no guarantee that the customer will come back to your page in the future.
Onsite payments completely differ from offsite or redirect payment methods. In offsite or redirect payment methods, the customers were taken to a payment page that is not organized or maintained by the original e-commerce site.
However, in onsite payment, the e-commerce site maintains the payment methods. This allows them to customize and have different payment methods. But the downside is since the e-commerce site is dealing with sensitive information about the customer, they must handle them carefully.
Any breach of information could put the business in great danger. So to secure all the information, you need to purchase an SSL certificate. The SSL certificate will allow you to encrypt all information
If you want your customers to have a seamless payment method, then you should try to redirect a variant of the payment gateway.
The reason it is called redirect is that, in the payment process, it redirects the customer to a different page. The payment service provider (PSP) hosts this separate page. Then you put your card number on the website. Next, your card number will be verified by the page. If everything is valid, then the payment process is complete and has been recorded by the PSP.
A redirect payment gateway has many benefits in the e-commerce sector. It allows customers to have a secure payment, and since PSP is trusted worldwide, they will feel confident and comfortable purchasing through this gateway.
One downside of the redirect gateway is that it lacks customizations. Since it redirects to a page provided by PSP, only PSP can change or modify the page.
E-Commerce sites have no control over the page and hence cannot customize it to better meet the customers’ needs. An example of the redirect gateway is PayPal.
To find the perfect payment gateway for your business, you need to consider a few factors-
Gateways do not support all types of payments at the same time. That is why it is necessary to know the type of payment your customers are likely to use for your online business.
If you see that most customers are using MasterCard, then get a payment gateway that supports MasterCard. If the customers use Visa Card, then get a gateway that supports Visa Card payment.
A solution to this would be to get a gateway for each type of payment, but this will cost you more.
Payment gateways are not free. To get a gateway from any payment service provider, you need to pay a fee. Check how much you can spend on payment security.
Now, look at different payment service provider offers. If you find an offer that goes with the allocated money, then you should strongly look into that gateway.
Payment Card Industry Data Security Standard or PCI DSS is a system responsible for upholding security provisions of all types of online transactions.
PCI DSS can also assess your security measures. For example, if you are going to use PayPal as your gateway, then you can find out about any security issues through PCI compliance.
This will allow you to see how secure the encryption is. A higher encryption safety will make payment processes less likely to be attacked by hackers. Encryption comes with an SSL certificate that can be purchased from different SSL providers. You can find branded SSL certs like RapidSSL certificate, GlobalSign, Thawte, etc at a discounted price if you purchase them from resellers. You will have the same level of encryption as well.
Many e-commerce sites are now adopting payment gateways. They are much more simple and easy to operate and provide the highest security. According to Shape Security, of all the login attempts to online retailers, 90% were hacking attempts. The retailers would have been hacked, and a huge amount of money would have been lost, if these e-commerce sites had not used payment gateways.