As a consumer, when you make a payment from your local shop, you can swipe your credit card through the cash register and gas, coffee and cakes are paid for. But what if you are a retailer and your business is online? It’s not like you have a card slider on every customer’s computer! There must be a way to process this information. Basically, this is the job payment gateways for online retailers do. Roy Banks, president of http://Authorize.net, a leader in the payment gateway industry, describes his company’s function as a “digital version of a POS terminal.”
What is a payment gateway?
Payment gateways allow online merchants such as shop owners or auctioneers to accept credit card payments online. They certify the cardholder’s credit – that is, they check to make sure the customer has enough money on their credit card to cover the cost. Then they make a reservation for that amount so the buyer can’t come back and spend the same amount elsewhere before it’s transferred to the retailer’s account. The bank describes this as “the technology … needed to complete payment transactions.”
Payment gateway is not a merchant account.
Many people confuse merchant accounts with payment gateways, but they are not the same thing. Merchant account services often act as a link between your commercial bank account and a payment gateway. When a customer orders products from your business online, their card is processed through a payment gateway. Then the funds are transferred to the merchant account service. The Merchant Account Service then transfers the newly withdrawn funds to your merchant bank account.
3 tips for choosing a payment gateway:
1. Is it PCI compliant? This means that the company’s security has been audited by a third party and proven to meet industry standards. Since payment gateways store all of your customers’ credit card information (which avoids stress), it also means you can sleep better at night, knowing that the information that is valuable to your customers is safe and sound.
2. Good customer support. Nouf said.
3- Finally, it is important that the payment gateway you choose is integrated with the third party solution you intend to use. And that means things like store front platforms and shopping carts – you want them to be compatible with your portal.
Not only do payment gateways let you raise money from sales, but many of them also offer a variety of security features, some of which will help you avoid falling victim to fraudulent orders! Ultimately, this will make your e-commerce business a less stressful and more enjoyable experience – for you and your customers.