All You Need to Know While Choosing a Payment Gateway Service

In India, the e-commerce industry is rapidly expanding. Small and large merchants alike are shifting their operations online. If you want to start an e-commerce business, you'll need an online payment gateway to accept online payments from customers. Payment gateways not only allow you to accept online payments, but they also allow you to easily manage your transactions and track your sales volume. With so much information available on the Internet, selecting the right payment gateway for your website can be difficult. Let us first define the term "payment gateway."

What is a payment gateway?

A payment gateway acts as a middleman between a merchant and a customer, providing payment options and allowing customers to make payments. It is a third-party service that allows customers to pay and merchants to accept payment in a safe and secure environment. In layman's terms, it's the same as swiping your credit card at a physical store. The distinction here is that you are making a digital payment via the website.

How does a payment gateway work?

Step 1: A customer places an order on the website by submitting the order. The "Buy Now" button is pressed.

Step 2: The merchant submits the order to the payment gateway. The customer pays using their preferred payment method. For authentication, the transaction is routed to the payment processor.

Step 3: Following successful authentication, the issuing bank either authorizes or declines the transaction based on the funds available in the customer's bank account.

Step 4: A message is sent to the merchant by the payment gateway.

Step 5: The amount is settled with the payment gateway by the issuing bank. The payment gateway then settles the amount with the merchant.

The following are a few factors to consider when choosing a payment gateway service:

Important Parameters while Choosing a Payment Gateway Service

1. Onboard Time

Getting started with payment gateway formalities for your e-commerce business shouldn't be difficult. A few payment gateways have a time-consuming onboarding process that can take up to a month to approve your merchant account. You may be required to submit a lengthy list of business proofs or physical documents at times. If you are new to the e-commerce business, this delay may have an impact on your sales volume. Choose a payment gateway with quick onboarding services, such as approval of the merchant account in less than a week. In addition, the document submission and verification process should be conducted online.

2. Digital Security

Online payment frauds like phishing, identity theft, data security breaches, and hacking are on the rise. As a result, it is critical to ensure that the best online payment gateway you use offers high-level security. You should inquire about the security measures they use to prevent fraud. The PCI DSS Certificate should be on your checklist when looking for security measures. A PCI-compliant payment gateway is a valuable asset that informs customers that their transactions with your company are secure.

3. Ease of Integration  

It is critical to determine whether the payment gateway is compatible with your website or app platform. Is there a shopping cart plugin available? Is it possible to get mobile SDKs for your app? Do they offer technical support? If your answer is yes, you may proceed.

4. Payment Methods

Having multiple payment options allows your customers to easily complete the transaction. Some customers prefer to pay with a payment method that offers them cashback and discounts. Choose a payment gateway that accepts all payment methods to provide your customers with a simple payment experience.

5. Settlement Period

The settlement period is the time frame in which a merchant receives the money paid by a customer for e-commerce purchase. Choose a settlement period. You may be required to pay an additional fee if you require your funds in a shorter period of time. Most payment gateways have settlement times of T+1, T+2, and T+3, where T represents the transaction date plus the number of days.

6. Customer Support

Your account has been approved, and the payment gateway has been integrated into your website. But what if you're stuck with a problem and aren't getting help from your payment gateway provider? To resolve your issues, the gateway you choose should provide a single point of contact. Their turnaround time should be less. They should be accessible 24×7 through email and chat. After all, customer support can make or break the reputation of the company.

7. Pricing

Your last priority should be pricing. Compare the prices of all the gateways to see which one best fits your budget. A few payment gateways charge annual maintenance and setup fees. Make certain that there are no hidden or additional fees, as these can eat into your profit margin. In addition, conduct a thorough search to see if they offer any customized rates for specific transactions.