Payment Gateway and an E-commerce platform

A payment gateway is an online payments’ path (similar to a POS terminal), which authenticates the cardholder and processes the payment. The main difference from POS terminal is that, in case of a payment gateway, the shopper may be sitting in a different city, state or a country altogether. Because of the distance and anonymity of the shopper, a payment gateway requires special encryption and verification technology.

An e-commerce platform is a software technology solution, which lets an individual or a group to build their own shopping platform(s) space online. Also available as APIs (application), these platforms are convenient for shoppers with several benefits attached, such as:

Since the e-commerce platform/industry in India is seeing a steep rise rapidly, the importance of payment gateway has also gone up. To make the e-commerce platform convenient enough, delivery on the doorstep and easy to navigate API (application) are not enough. An e-commerce platform requires an efficient payment gateway to add on to the safety of payments, leading to customer loyalty and increased profits.

Payment Gateway as an important factor for Security of Payments

Since a payment gateway is such a crucial part of an e-commerce platform, it is imperative to understand it from the security aspect. Security, being the top-most benefit of a payment gateway, aids in lessening the intensity and frequency of credit card fraud within the e-commerce platform. A payment gateway, as mentioned earlier, authenticates the cardholder/shopper so as to make a safe flow of payment from his/her account to the merchant/e-commerce platform’s account. This entire flow of payment is secured with the help of a payment gateway. A payment gateway maintains security by following a protocol for the same and thus, data of the customer is encrypted in a safe manner.

There are some definite reasons, which make a payment gateway apt for the e-commerce platform:

  • Integrating a payment gateway does not require much hassle and can be set up easily by the merchant/e-commerce business that already has a website/application for the business
  • It requires slight maintenance, and thus, is extremely cost-effective.
  • Because of the popularity of a payment gateway, majority of the people are familiar and comfortable with its concepts. This makes it easier for the online business since there is no requirement of knowledge for the same.
  • A payment gateway helps in quick checkout with the customizable checkout page. A merchant thus, can customize the checkout page in accordance with the demands.

Moreover, it is Simple to get a Payment Gateway – Hosted Page

After understanding how payment gateway integration is beneficial for an online business, it is imperative to note that it is also simple to get a payment gateway (Hosted page) and thus, all the benefits.

A Hosted Page redirects the customer from e-commerce platform/portal/application to the payment gateway where the customer selects the payment option and fills in the card details. In this case, designing of the page or validations are not required. This way, the card details remain safe with the payment gateway, which makes the transactions highly secured. Beside, a PCI-DSS compliant payment gateway adds to the security of transactions by customers. It minimizes fraud and chargeback as a result.

The benefits of using online payment gateways for customers are many like fast payment, smooth flow of transaction, flexibility with one-click solution, secure option and overall a better experience. It supports various payment methods such as Master/Visa/Maestro/Amex. The payment disbursement process happens in approximately 3-4 days.

Firstly, for setting up a payment gateway, an online business owner should be sure of the factors mentioned below:

  • Needs to be a hosted gateway
  • Should provide easy integration with the website
  • A knowledge of that Payment Gateway’s fee for better decision making

Two ways of setting up payment gateway

A payment gateway is a platform, that authorizes payments for e-businesses and online retailers. In general, there are two definite ways of setting up a payment gateway, and that happens by:

1.) Direct integration through Application programming interface (API) module by connecting his Bank account with the Payment Gateway.

2.) Integration of the Payment Gateway firstly on Test Mode & then on Live Mode user acceptance test.

 

Hence, an Increase in the demand for Payment Gateway in India

Pertaining to the timesaving, cost-effective and discount driven e-commerce marketplaces, India has witnessed a steep rise in the demand of the same. Online businesses, with their easy-to-use APIs (applications) have gained traction over a period. All the more, an advancement in delivery infrastructure along with smartphone penetration as well as data usage are all a plus.

But the fact remains that an e-commerce platform is incomplete without an efficient and reliable payment gateway facility. Hence, the rise in e-commerce marketplaces has led to a rise in payment gateway integration by the online businesses.

 

Source: Bain & Company and Times of India

 

Above, the picture makes it clear that India is adopting e-commerce platform more rapidly than any other country. This is a vivid representation of the growing needs of payment gateway services since an e-commerce platform and payment gateway go hand-in-hand.

Also read here , what all Lyra’s Payment gateway offers.

What is Payment Gateway and how does it function?

Payment Gateway: A payment gateway is an online payments’ service that, when integrated with the e-commerce platform, is devised as the channel to...

16/05/2019