What is a payment gateway www.deekpay.com

Payment Gatewayis a transaction processing technology that captures, stores and transmits card information from the customer to the acquirer. It then shares the payment acceptance or rejection notification to the customer. In other words, the payment gateway acts as an intermediary between the customer and the merchant. By acting as an interface between the merchant's website and its acquirer, the onlinePayment GatewayIt can simplify the way merchants process card payments.

A payment gateway can protect a customer's sensitive payment data because it uses data encryption to forward it from the merchant to theacquirerThe gateway is then forwarded to the card issuer. The gateway follows a number of stringent data protection procedures defined by the PCI-DSS compliance standard, which also includes annual audits and recertification to ensure the validity of the standard.

How Payment Gateways Work

The payment gateway work process, including the steps taken during payment card processing, i.e. authorisation, capture and settlement.

When a customer selects the product/service they want to buy, they go to the payment page of the e-commerce site. Most payment gateways offer different options for the checkout page. Customers enter their credit or debit card details on the payment page, including cardholder name, card number, card expiry date and card verification value (CVV) number. Depending on the merchant's preferred integration (hosted payment page, server-to-server integration, or client-side encryption), this information is securely passed to the payment gateway. The payment gateway encrypts the card details and performs fraud checks before sending the card data to the acquirer. The acquirer sends the information securely to the card organisation, which performs another layer of fraud checking, and which transmits the payment data to the card issuer for payment authorisation. Authorisation. The card issuer authorises the transaction after performing the necessary fraud screening, i.e. validating the transaction information and ensuring that the cardholder has sufficient funds for the purchase and/or that the bank account is valid. Payment messages approved or rejected by the card issuer are transmitted from the card organisation to the acquirer. The acquirer sends the approval or denial message back to the payment gateway, which then transmits the message to the merchant. Based on the message, the merchant can display a payment confirmation page or ask the customer to provide another payment method. The card captures the request and, once the authorisation is complete, the merchant can 'capture' the purchase amount from the buyer to the merchant account. The customer is not charged until the capture occurs, but the funds are held and their card limit is reduced. Settlement, if the payment is approved, the acquirer collects the payment amount from the issuer and "holds" the funds in the merchant's account (see below for more information on merchant accounts). When actual settlement occurs depends on the agreement between the merchant and their payment service provider.

Both merchants and customers benefit from payment gateways, even though most of their activities happen behind the scenes of the payment process. All of the above steps can happen in near real time or take seconds.

Payment gateway security features

Handling confidential payment card data, security and compliance are top priorities for payment gateways. However, just as digitisation has enabled e-commerce sales to flourish, online businesses and their customers have also become more vulnerable to cybercriminals. In fact, global online payment fraud is expected to reach $48 billion by 2023, making the payment security provided by payment gateways even more important.

Investing in robust risk management solutions that help detect and block fraudulent online transactions is key, and having the right payment gateway is a good place to start. Below we have listed some of the security measures used by payment gateways to help merchants choose the right ones for their e-commerce business.

PCI DSS Compliance

The Payment Card Industry Data Security Standard (PCI DSS) is a set of international security regulations implemented by card organisations. PCI DSS is designed to protect credit and debit card transactions while preventing the misuse of cardholders' personal information. Businesses that accept, store, process and transmit sensitive card information must be PCI compliant to effectively prevent fraud (watch the video below and learn all about PCI compliance).

tokenisation

Tokenisation is another way for payment gateways to protect users' payment card details. During the payment process, sensitive card details are replaced with unique identifiers, known as tokens. This means that if someone tries to intercept the merchant's data before it reaches the secure decryption endpoint, they will only see it in an incomprehensible form.

Tokenisation allows consumers to enter their card details only once, so there is no need to re-enter the same details for future transactions. Using this technology helps merchants to achieve a smoother and more secure payment experience for their customers, as they have fewer steps to perform when checking out on the merchant's website after the first transaction.

3D safety certification

3D Secure is an authentication protocol designed to minimise fraud and enhance the security of online card payments. During the transaction process, customers enter their payment card details and then complete an additional two-factor authentication step with the card issuer to validate the payment.

3D Secure Payment Gateway Enables More Secure, Frictionless Payment Processing Across Devices. Visa and Mastercard have announced that they will be discontinuing the 3DS1 protocol globally, effective October 2022, and will only support 3D Secure 2 (3DS2), an enhanced version of 3DS1.

Types of payment gateways

With technology advancing at a rapid pace, more and more businesses are utilising payment gateways to accept payments in a more convenient, secure and efficient way.

Payment gateways typically offer merchants a variety of ways to accept online payments. Below we explore some of the most common ways to integrate with payment gateways and accept payments, including the benefits of these integration options.

Hosted payment page (pre-built UI)

If a merchant does not want to manage the integration and maintenance of a website payment gateway, a hosted payment page integration may be ideal. This integration directs the customer from the merchant's website to the payment service provider's secure server, where customer data is entered, stored and processed. Upon completion, the customer is directed back to the merchant's website to complete the sale.

Benefits of Hosted Payment Gateways

High level of security: Payments are processed by PCI-compliant payment partners, which helps prevent fraudulent customer transactions. This also means that this type of integration requires a minimum level of PCI compliance.

Customisable - merchants have the flexibility to partially adapt the payment page to suit the look and feel of their e-commerce site.

Server-to-server integration (custom UI)

Server-to-server integration is the preferred option if merchants want to have complete control over transaction flow and site design. However, it is important to note that this integration requires more complex development and involves a higher PCI compliance burden. In practice, the customer completes the payment on the merchant's website, so the customer journey is not interrupted and is native to the merchant's website. This can be achieved by establishing a direct connection between the merchant's server and the payment gateway using the payment service provider's API.

Benefits of Server-to-Server Integration Checkout is fast: customer transactions take place in one location - i.e. to the merchant's website - and are not redirected to a separate payment page. It is also more likely to reduce checkout abandonment. Fully customisable: merchants can design checkout pages to fit the aesthetics of their online shop, giving them complete control over the user experience. Client Side Encryption (CSE): This integration method, also known as "source encryption," is an encryption method that allows merchants to accept payments on their website while encrypting sensitive payment data directly in the customer's browser. This may involve encryption that the merchant can apply in a server-to-server integration using their payment service provider's CSE library. Advantages of client-side encryption

Processes can be customised: this integration allows for customisable checkouts as merchants increase their control over the purchase process.

Low PCI compliance limits: With this type of integration, cardholder data is encrypted in the customer's browser before it is sent to the server and gateway, which reduces the PCI burden.

Platform integration

Platform integration through plug-ins and modules provides merchants with a way to connect to payment gateways and easily accept payments using their e-commerce platform.

Advantages of Platform Integration

Reduced development time and cost: platform integrations have less custom coding, which merchants can set up through the main configuration settings.

Reduced PCI Compliance: This type of integration requires a minimum level of compliance, which can help merchants save money and liability.

The core difference between the different types of payment gateways and payment acceptance methods is the way they are integrated into a website. Some offer less development resources or time and PCI compliance burden, while others require more of the above. Most importantly, the best payment gateway for merchants to integrate into their websites is one that meets the merchant's business model and processing needs and infrastructure.

The Role of Merchant Accounts

Merchant accounts are specific bank accounts required to accept debit/card and electronic card payments. These accounts are issued by organisations such as payment service providers, acquirers and payment gateways and allow businesses to receive funds from their customers in a secure and timely manner. However, a merchant account should not be confused with a commercial bank account that a merchant uses for day-to-day expenditures. A merchant account identifies the merchant as the owner of the payment data transmitted to the bank and as the recipient of funds for online payments.

The payment gateway (or the entity that sets up the merchant account for the merchant) deposits the funds from the customer's payment into the merchant account. This makes the merchant account necessary from the time the customer submits their card details, the acquirer transfers the funds to the business account and the merchant receives the funds.

Essentially, merchant accounts simplify the way merchants get paid; the merchant's payment gateway collects them into the merchant's merchant account and consolidates them into a single deposit in the merchant's bank account.

Payment gateways supporting different currencies

Payment gateways that support multiple currencies are vital e-commerce infrastructure for merchants accepting international payments, meaning that the merchant's organisation charges its customers in multiple currencies (e.g. Pounds Sterling, Euros, etc.).

With payment gateways that process payments in multiple currencies, merchants can:

Increase customer trust and conversions - A survey by The Payers reveals that more than seven in ten (73%) cross-border buyers feel more comfortable purchasing products from brands whose pricing includes local currencies they are familiar with. Accepting payments in multiple currencies helps to increase merchants' sales and profitability, which is achieved through a single payment gateway integration under one merchant account.

Gain a Competitive Advantage - Accepting payments in the preferred currency of the target consumer can provide merchants with a strategic advantage over competitors who do not.

How to choose the best payment gateway for your business

Payment gateways may sound complicated, but they don't have to be when merchants partner with trusted and experienced payment service providers and acquirers. With over 20 years of online payment processing experience through ATPAYWe are proud to be the first merchant in the world to be PCI Level 1 compliant, so merchants can be sure to provide a streamlined and attractive payment experience for their customers. In addition to our year-over-year compliance with PCI Level 1, we pride ourselves on being a one-stop shop. In this way, we provide merchants with a flexible, easy-to-use payment platform that includes a payment gateway, global acquiring, alternative payment methods (APMs), card issuance, and in-house risk and fraud management services.

Atpay - we are a professional provider of payment solutions and have been deeply involved for many years inIndia PaymentsWe have successfully provided payment functions for countless customers at home and abroad. We are fully confident in payment integration and high-risk payment processing, and welcome inquiries and exchanges.