Most online merchants accepting payments through their e-commerce website have probably used a payment gateway even without their awareness. Payment gateways are e-commerce services that process, authenticate and receive or reject payments directly or through credit card processing on behalf of merchants.
For all this to happen, they need an internet connection that is reliable and secure. In 2018, A Thales Data Security Report disclosed that about 75% of US retailers have been subjected to at least one cybersecurity failure where their online stores are concerned.
This data underscores the need to comprehend how these applications work and their importance to online merchants.
Why Online Merchants Need Payment Gateways
The use of payment gateway systems is essential in abating the prevalence and gravity of credit card fraud in the e-commerce business ecosystem. These application service providers ensure that there is a safe environment for processing credit and debit cards as well as other online payment options.
The software functions as the go-between to ensure that the customer’s data is coded and any form of unauthorized access is hindered. Gateways use Secure Socket Layer (SSL) protocols to code payment and card information.
They also use Payment Card Industry Data Security Standards (PCI DSS) that merchants must comply with so that all the information about payment processing is secured.
They operate as the link between the customer and the business during an electronic payment process. Furthermore, they handle quite a considerable volume of information required for online transactions.
Payment Gateways Keep Customers On Your Site
The payment gateway system is highly essential to online merchants because it makes customers stay on their website. Most customers will leave or fail to complete a transaction if they’re directed to a new page through a pop-up window in order to make a payment.
Having a gateway payment processor means that merchants have control of their checkout pages. Therefore, they can customize the pages to suit their online business needs. This is highly beneficial for the success of an online business.
Having this software also means that your customers have more options for credit card transactions. This will turn out to be a convenience for customers. Plus, it will mean that there’s little or no irritation during the checkout process.
If you have customers using other forms of online payments such as PayPal, they too will be able to make secure online purchases.
Factors To Consider When Choosing Payment Gateways
Before choosing a payment gateway, you need to determine a few factors. You must first determine the type of payments that your customers prefer to use.
Knowing what they’re already using for their online payments is essential in determining the gateway that you will work with. If you opt for a system that they can easily use, you’ll not run into headwinds with your customers.
It’s also important that you look at the issues of safety and security. You must ensure that you work with a partner who is PCI compliant and has the Payment Card Industry Data Security Standards (PCI DSS).
You also need to ensure that you’re working with a partner who has high-level encryption.
There’s no doubt that payment gateways are essential for online merchants. Not having one means that important information about transactions cannot be transferred. This also means that transactions cannot be completed because they will not get any verification.
When you work with a dependable payment gateway service, all your online transactions will be quick and secure. This is what every customer needs. Additionally, it can be a crucial factor that increases your bottom line.