As a business owner, it is in your best interests to make the customer payment process as easy and as flexible as possible. If you only accept cash, you are sure to lose sales to your competitor down the street or across the ocean who is accepting credit cards and other more modern forms of payments. In a nutshell, that is why you need access to an omnichannel payment gateway, the ultimate in essential merchant accessories in today’s increasingly cashless environment.

The payment gateway defined.

Although the concept may seem vague at first, a payment gateway is nothing more than a network that enables you to securely accept credit and debit card payments from customers. In fact, you can think of it as the digital equivalent of the point of sale solutions that are used in most retail stores. Although gateways are usually associated with ecommerce sites, they can also be used in physical stores to securely process digital payments of all types.

The payment gateway process explained.

The process of conducting a transaction using a payment gateway is actually pretty simple. It contains the following steps:

• The order is submitted either by the online customer or by you in your brick-and-mortar store.
• Using Secure Socket Layer (SSL) encryption, the sensitive transaction data is encrypted and sent from your or your customer’s web browser to the server.
• Again using SSL encryption, the data moves from your server to the payment gateway.
• Details of the payment are then securely sent to your payment processor.
• The details are then forwarded to the relevant card association (Visa or Mastercard, for example).
• Next, the bank that issued the customer’s credit card verifies the transaction after checking for insufficient funds or fraud. The bank will then send a response code signifying their acceptance or rejection of the transaction.
• The issuing bank sends the response code to the payment processor.
• The payment processor passes the code on to the payment gateway.
• The gateway sends the code to the merchant and the customer, concluding the transaction.

Believe it or not, this safe and seamless process takes place in a matter of just a few seconds.

The importance of security.

When consumers mull over the pros and cons of obtaining goods over the internet, security is usually their top concern. Considering the constant headlines about fraud and data breaches affecting both buyers and the private and corporate sectors, it’s no wonder why. 

What makes payment gateways particularly compelling is the high degree of security they offer, which comes from the requirement that they adhere to the data security standards set forth by the Payment Card Industry (PCI DSS). Known as PCI compliance, this set of mandatory guidelines helps to safeguard customers’ sensitive card information, while simultaneously protecting you, the business owner, from liability should the worst happen and a data breach occurs. 

In addition, the encryption that takes place during the transmission of information between the gateway and the buyer’s issuing bank provides a second layer of safety. 

Combine these with the third security shield, i.e., 3-D Secure (a relatively new standard that requires customers to create and provide a unique password for each card they use) and your customer can have maximum peace of mind.

Increased convenience.

In effect, your omnichannel payment gateway functions as your silent partner who remains on duty around the clock to accept your customers’ payments. As a result, consumers are able to make their purchases on their own schedules — even when you’re at home asleep or on the beach during a well-deserved vacation.

Integrating your website with a payment gateway.

In light of all these benefits, you may now be ready to bring the power of the payment gateway to your burgeoning ecommerce business. You’ll have three types of gateways from which to choose:

• Hosted gateways — these types of gateways require that your customers be directed away from your website to complete their purchases. A well-known hosted gateway is PayPal, which processes your customers’ payments and sends them back to your website to complete the checkout process. Although being shuttled back and forth between sites can be disconcerting for some buyers, you can make the process more palatable by customizing PayPal’s payment processing page with your own brand graphics.
• Non-hosted gateways — these gateways enable customers to remain on your site throughout the payment process. After the buyer enters their details, the information is transmitted to your gateway where the transaction is verified. Although the user experience is more seamless with this type of gateway, you as the merchant are given the added burden of being responsible for the security of the consumer’s credit card data. This puts the onus on you to be PCI compliant. 
• An Application Programming Interface (API) gateway — APIs are similar to non-hosted gateways in that all details are entered on your webpage with the customer never being redirected to a third-party site. The difference is that the gateway gives the merchant total control over all aspects of the checkout process, including the brand and logo. As with the previous type, you are responsible for ensuring the PCI compliance, SSL certification, and other security protocols of your gateway.

If you want to take your business to the next level, the seamless user experience, speed, and security that the right payment gateway partner can provide might be the perfect passport to the growth you seek. Before choosing your gateway, take some time to review your current and projected business needs to maximize your chances of success.