What is Website payment processing and how does it work?by Sahil Verma SIFIPAY
How does a website payment processing system benefit a business? A mature system that is secure, fast, and saves time and money can help to improve the shopping experience.
Do you know that if they have to wait more than 3 seconds, more than 60% of shoppers abandon their cart? However, more than 70% of shoppers say they will not return.
Customers do not want to wait any longer for their payments to be processed. As a result, if your website's payment system isn't kept up to date, you're likely to lose a lot of potential customers.
To accept payments from customers through an online payment gateway, a modern payment system for a website provides payment links and QR codes. It is advantageous to provide a seamless website payment processing experience, as this speed up the entire payment process. As a result, it is critical to select an excellent payment system for your website. Let's dig a little deeper to learn more:
How Does a Payment System for a Website Work?
When your customers pay for your services or products online, their money must flow. This is how it works:
1. A customer purchases your services or products online and selects the preferred payment method.
2. A payment system for website payment processing collects and transmits financial information to the card network.
3. Once the transaction has been authorized, the information is shared with the issuing bank and card network.
4. This information is shared with the payment system for website payment processing, and the funds are then sent to the card network by the issuing bank.
5. After the card networks take their cut, the funds are transferred to the acquiring bank, where they can be deposited into the merchant account and then into the business bank account.
The entire procedure is automated. However, the primary function of a website payment system is to translate encrypted financial information from one bank to another. Online credit card gateways play an important role in preventing fraud and ensuring smooth website payment processing between customers and businesses.
Why You Need to Integrate a Payment System for Website
You must have a payment system for your website in order to accept online payments. However, it is critical to select a system that allows for easy integration and website payment processing. A website with a slow payment system will eventually lose a customer.
1. Process Large Transactions Easily
Larger transactions can be difficult to process. If your customer is paying a large sum of money, he wants to know that it will arrive at its destination.
Integrating a licensed payment system for website payment processing provides your customers with the assurance that their credit card information will not be shared with any third parties.
2. Increase Website Conversions
Taking your customers to a different page to make a payment can be perplexing. This is where errors occur, so it is critical to ensure that a payment system for a website provides a smooth flow for customers. Providing a superior customer experience ensures that the entire website payment processing process is smooth and quick. A smooth website payment processing ensures that customers are satisfied with the website payment system.
3. Track Payment on One Dashboard
You will have to deal with three different dashboards if you use multiple best online payment gateways to process different payment methods. In such a situation, keeping track of your cash flow can be confusing and difficult.
Having a single payment system that accepts all payment methods for website payment processing allows you to easily track your cash flow.
With the growth of e-commerce, a payment system for websites has emerged. The method of recording collection and payment behavior continues to evolve with the passage of time. Nowadays, in the internet age, our business activities have also evolved through digitization and informatization, which is known as an e-commerce business. Let's learn more about website payment processing and how it works.
What is website payment processing?
Website payment makes use of the most advanced communication media, such as the Internet and Extranet, whereas traditional payment makes use of traditional communication media. Website online payment necessitates a high level of software and hardware infrastructure. In general, a networked computer, related software, and other supporting facilities are required, whereas traditional payment does not. Following are several steps for customers to take during the website payment processing:
1. Customers connect to the Internet (Internet), browse goods online using a browser, select goods, fill out online orders, choose the online payment and settlement tools, and are authorized by the bank to use them, such as bank cards, e-wallets, e-cash, E-check, or online bank account number, and so on.
2. The client encrypts pertinent order information, such as payment information, before submitting the order online.
3. The merchant server verifies the customer's order information and forwards the relevant and encrypted customer payment information to the payment gateway until it is confirmed by the bank's private network's back-end business server, in order to verify it from the bank and other electronic money issuing institutions. Obtain permission to pay funds.
4. After the bank verifies and confirms, the confirmation and payment settlement information is sent back to the merchant server via the established encrypted communication channel via the payment gateway. The payment authorization request is returned to the customer for additional security (or not).
5. After receiving additional authorization settlement information from the customer, the bank transfers funds from the customer account to the bank account of the merchant conducting e-commerce, settles using the financial private network, and sends successful payment and settlement information to the merchant the customer.
6. The merchant server sends the online payment success information and delivery notice to the customer after receiving the settlement success information from the bank. So far, a typical online payment settlement process has come to an end. Customers and merchants can use the Internet to check their own fund balance information for confirmation.
How does payment processing work?
Let's start with the fundamentals. Any online payment processing platform is made up of three parts:
Merchant account: A merchant account is a bank account that accepts online payments for Internet businesses. Payment processing companies, independent contractors, and large banks can all provide you with merchant accounts. You won't be able to keep the money your customers paid you if you don't have it.
Payment processor: Payment processing companies or financial institutions handle transactions between the customer's bank and the bank. They handle issues like credit card validity, available funds, card limits, and so on. Security is a more important function of payment processors. It is the payment processor's responsibility to ensure that the card information is correct. They also deal with a variety of errors, such as unintentional transactions and incorrect charges.
Payment gateway: This is similar to an online point of sale. The payment gateway acts as a go-between for all transactions on your website and the payment processor. It links your merchant account to credit and debit card companies like MasterCard and Visa. Therefore, payment gateways are essential for Internet payment processing systems.
Customers, businesses, payment processors, payment gateways, customers' banks, and corporate banks all participate in online card processing services. Some online payment processing software providers offer all three components, namely merchant accounts, payment processors, and payment gateways, on a single platform. Others integrate merchant accounts, online payment gateway India, and third-party payment processors.
Website payment processing flow
The payment system's data flow can be divided into two modes: merchant forwarding and non-merchant forwarding. The entire transaction process must go through the following payment process the customer initiating a purchase request to the customer receiving the product and the merchant receiving the funds.
1. The user browses the e-commerce website, chooses a product, and submits a purchase request to the merchant.
2. The merchant digitally signs and submits the user-verified order to the payment system.
3. The payment gateway contacts the payment interface and requests that the user enter their account information.
4. The user encrypts the account information with the payment gateway's public key and sends it to the payment system.
5. If the confirmation is successful, the financial institution's returned result of the digital signature is sent to the merchant, and the merchant is notified to deliver the goods. Otherwise, the merchant receives notification that the transaction was unsuccessful.
6. The confirmation is complete, and the financial institution must transfer funds.
Created on Jul 8th 2022 06:01. Viewed 77 times.