Payment Gateways in E-Commerce
Payment gateways in e-commerce are an essential element of online payments. They connect to merchant accounts, verify customer credit card data and authorize transactions – without this step your customers would need to leave your website and go elsewhere to deposit their cash; potentially leading to lost customers and missed opportunities for your business. Whether operating solely online ecommerce or using your website as an extension of brick-and-mortar stores, finding an ideal payment gateway will ensure payment is made quickly while expanding business growth.
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Payment gateways enable your customers to pay instantly through your website. Unlike traditional transactions that require customers to come into your store and swipe their credit card, online transactions take place as “card-not-present” transactions; meaning their card data is sent securely from browser to payment gateway where it is encrypted so only you can see it.
Once card details are securely submitted to your payment gateway, it will contact the issuing bank and confirm if the card is valid and has sufficient funds. If everything checks out, they’ll approve and transfer funds directly into merchant (Acquiring) bank’s merchant account, while customers can see pending transactions appear on their credit card statements.
Paypal is one of the world’s most widely used ecommerce payment gateways, available in over 200 countries and supporting most major credit cards – making it one of the most versatile solutions available to your business. Stripe is another option popular with American ecommerce businesses; though more complex to set up, it offers additional tools and support – including WooCommerce integration and Facebook Marketplace support.
Considerations when selecting a payment gateway should include its support for various currencies, its ease of integration with your ecommerce platform, and how many fraud prevention tools it contains. Also ensure that any provider offers customer data portability; otherwise if ever switching payment gateways becomes necessary, your customer records could become lost in the transition process.
Finally, it is vital that your payment gateway offers exceptional customer support. Should any issues arise that need immediate resolution, having someone available via phone call/text/email/live chat would be extremely useful and is especially essential if you are new to ecommerce or have complex payment setup requirements.
