Settlement of online payments done by buyers to the sellers was never a convenient task before because the payment platforms were regularly under the threat of hackers and scammers. These threats had a huge impact on the companies because the entire Online Payment Gateways relies heavily on the online mode of transactions.
As per the study conducted by Shape security in 2018, around 80% of unsuccessful login attempts to e-commerce platforms were illegitimate login attempts made by hackers. This itself is the highest percentage for any sector. That is the reason why it becomes essential for individuals to have complete knowledge about the quality of online payment gateways that would help them to mitigate the chances of a hacking attack on a real-time basis along with understanding the process of encryption between buyers and sellers.
High-quality payment gateways offered by Steer Through help individuals to reduce their load time of payment. As per the survey reports about abandonment, the top reasons behind the abandoning of an individual’s shopping cart are dependent on the quality of e-commerce firms offering payment gateways. The data states the following:
- 15% of customers abandon their shopping cart because of the poor in-store experience.
- 6% abandon due to lack of payment option facilities.
- 4% abandon due to technical problems faced by them while shopping.
These are the factors that have a huge impact on e-commerce’s functioning and must be addressed for the effective functioning of an e-commerce business platform. By selecting a payment gateway through Steer Through platform, individuals can run their business efficiently and effectively without worrying about security concerns.
What is an online payment gateway?
An Online payment gateway is a merchandiser that helps in processing various card and other UPI based payments for e-commerce sites and other traditional retail stores. Popular payment gateways offered by Steer Through include Citrus, CC Avenue, PayuBiz, Mobikwik, Instamojo, and others.
Payment gateways accomplish their tasks by following these simple steps in a fraction of seconds. These steps include:
- Encryption: It works between the buyer’s browser and the server of the seller. The payment gateway encrypts data exclusively between the buyer and the seller.
- Request: The request for authorization occurs when a payment processor gets approval from the card company, UPI platforms, or any other financial institution to proceed with the transaction.
- Fulfillment: When the payment gateway gets approved, it allows the website and interface to move to the following action.
The payment gateways also serve some other functions, including orders for screening, tax calculations, and also GPS for location-specific actions.
Difference between payment gateways and payment processors
You have heard a lot of times about these terms payment “gateways” and payment “processors”. But do you know about the difference between both of them? Here is the difference among them:
A payment processor analyzes and conveys various transactional data, which includes communicating relevant information to an issuer bank, such as credit/debit card numbers linked to a bank account. The work of the processor is certainly a step in the transaction process which include swiping of card and transferring information to the issuer bank. A payment processor can function on both modes, viz. software as well as a hardware basis.
On the contrary, an online payment gateway, in addition to the above-mentioned functions, also includes the power to approve the transfer of funds between buyer and seller. Its functions are mainly based on the functioning of the software.
Types of payment gateways
There are basically three types of payment gateways. These include:
1. Redirects: This option takes customers from the E-commerce platform to the gateway’s payment page for handling the complete transaction, i.e. processing and paying, by acting as a Redirect.
It gives an advantage of simplicity to the retailers. Any business, irrespective of its size, can use a redirect-gateway for incorporating the convenience and security of major platforms, but the process is not under the control of the merchants.
2.Checkout on-site and payment off-site gateways: In these gateways, the front-end checkout will occur on individual’s sites, but the option for payment to process happens at the gateway back-end.
Entrepreneurs and business owners should use well-established gateways to collect customer’s data on a third-party site. This helps e-commerce sites to keep themselves away from handling sensitive payment information.
Similar to “Redirect” payment gateways, these have many advantages that help business platforms handle their payments more effectively and simply. However, these have limitations also that e-commerce platforms would not be able to control their customer’s entire shopping experience through the payment gateway option. In these gateways, E-commerce platforms would have to sustain at the mercy of the quality of the off-site gateway and their quirks.
3. On-site payments: Giant business platforms use these gateways to handle the entire transaction on their own servers. The system carries out the entire work of checkout and payment processing on behalf of the customers through their own servers.
These provide an added benefit of controlling the entire transaction in a more responsible manner. They work efficiently for retailers and e-commerce platforms that have a high sales volume. These platforms understand customers’ other options in a more responsible manner while handling on-site transactions.
Limitations of Payment Gateway Integration
Everything in this world has two aspects one is good, that is in the form of advantages, and the other one is bad, in the form of disadvantages/limitations. The same is applied to online payment gateway. These also have some limitations. The limitations include:
- Gateways do not accept all card payment options: Online payment gateways do not support all forms of payment options as their support is limited to some cards only. So, it is advisable for e-commerce platforms to opt for payment gateway integration that supports most of the cards for transaction purposes.
- Not suitable for international buyers: Many times, users who are placed in some foreign country are not able to make their payments due to the limited international payment support option. In that case, the limitation affects the business to a greater extent. To avoid this problem, try to go with the gateways option that has international payment support.
- Security concerns: 1/4th of customers in the country still hesitate to make a payment through online payment modes due to many security concerns.
The security concerns include the following:
- Data breaches: The encryption of TLS help most online payment gateways to handle the processing of privileged data like card details, but when the data is available on the server, then it always remains under threat.
- Issues pertaining to mobile payments: One can control the security at the time of the transaction, but it cannot control at the user end due to the mobile phone accessibility.
- Malware attacks: Malwares that can read passwords and infiltrate user accounts can send all the authentic transactions details through secure payment gateways, even if the transaction itself is a fraud.
