Payment Gateways

Payment Gateways

A payment gateway is an e-commerce application, typically developed by a payment services gateway provider that provides a service that authorises payments for e-businesses, online retailers, "bricks and clicks", or traditional brick and mortar.

 

We can integrate the following payment gateways and then some...

 

Payment Gateways

 

It is the “equivalent” of a physical POS (Point-Of-Sale) terminal that is located in most retail outlets. Payment gateways encrypt sensitive information, such as credit card numbers, to ensure that information related to the transaction passes securely between the customer and the merchant. For example, a well known international payment gateway provider is PayPal.

So in effect, a payment gateway is a virtual credit card terminal for your website and serves the same purpose as that of a physical credit card terminal in a store, except that it in this case it is not a tangible physical device. Therefore, the main purpose and function of the payment gateway is to take the transactions from your website and send it to the processing bank to seek authorization and approval, or decline the card, and return a result to your website so you can complete the transaction process (and/or ask for another form of payment).

It is important to note, that a payment gateway is not an order management applicationapplication, and does keep track of your end user's items being purchased, that is the responsibility of your shopping cart.. It is the shopping cart that adds up the total amount of the purchase and then it is that application, that is passes the information on to the payment gateway along with that of the customer's personal information.

Although the payment gateway will make sure that you do not send insufficient or poorly collected information, in which case it would not be able to process the transaction. Crucial checks done by the payment gateway services provider will be, for example, to make sure that the credit card has the correct and right amount of numeric digits, expiration date and CSV code, etc. and that the information provided is valid.

For example, if a customer types in 12345 as their postal code, the payment gateway will not detect that it is a fake postal code. The same logic dictates that if a customer used 1234 1234 1234 1234 as their credit card number; it will be the website's programming to ensure basic data validation.

So a payment gateway connects to the merchant's website and/or or account to process credit card transactions, we need to keep in mind that the payment gateway in itself, is not a merchant account. In other words, it cannot process transactions without a merchant account number being linked to it. A payment gateway without a merchant account is even less useful then a credit card terminal without a merchant account.

Payment gateways are also commonly confused with third party processors as on the surface the two seem to be very similar. While it is true that third party processors do include a form of payment gateway in their services they are very different things. The service third party processors offer is a sharing of their merchant account. To effectively do this they must have you process everything through their system and as a result offer payment gateway-like functionality to facilitate the process. However, keep in mind that these are not true payment gateways as they only work with that of a third party processor and therefore limited entirely to the services that they offer.

Some additional tools commonly offered by payment gateway services providers are related to fraud screening. With Internet sales making up the overwhelming majority of credit card fraud, screening sales for fraud is a high priority for every online merchant. Most gateway providers provide tools to utilize basic fraud tools such as AVS and CVV by reporting the results of these systems or even allowing transactions to be declined automatically that fail either of the tests.

Since each payment transaction that is processed through a payment gateway is captured and stored in a merchant's account for later reference, this makes keeping track of online payments automatic (and hopefully redundant).

Although the function of the payment gateway's purpose may appear to be small in scope, it remains a very powerful and essential tool for online processing. If the prospect of using a payment gateway services provider, still appears to be daunting, just remember they are just virtual credit card terminals and act almost in every other way the same. They connect to your website and to your merchant account so that you can get paid from credit card sales. Simple yet powerful

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