Conducting electronic transactions is impossible without special routers, that is, payment gateways. What is this technology and why can no modern online store do without it? Let’s discuss it.
A payment gateway is a technical solution that allows an e-commerce platform to accept online payments from its visitors. In other words, a payment gateway is an essential tool for real-time payment operation.
The technology for processing online payments is not as simple as it may seem. However, an online store owner does not need to delve into all the technical nuances. It is enough to understand the principle of a payment gateway operation.
How are payment gateway transactions handled?
Payment processing from buyer to seller is a multi-step operation that requires multiple parties. The payment gateway plays a crucial role in it. Let’s highlight the main points of its functioning:
- After selecting an item on the e-commerce platform and sending it to the cart, the buyer proceeds to place an order. To do that he goes to the payment page and fills out the form with the details of payment.
- This is where the payment gateway comes into play. It receives information about the new payment, encrypts it and sends it to the payment processor and forwards the customer to that processor.
- The processor takes the buyer step by step to complete the payment transaction and verifies its success. After that the buyer is sent a message confirming the status of the payment.
- Finally, the buyer is automatically returned to the e-commerce platform.
Why do online stores need a payment gateway?
The main goal of an online store owner is to sell his goods or services. To do this he/she must make the buying process as easy as possible for his client. The most effective and least troublesome solution in this case is connecting to a payment gateway.
This tool allows you to quickly process all types of payment transactions online. The payment gateway is also responsible for securing transaction information between the buyer, merchant and acquiring bank.
Using a payment gateway guarantees the business owner the following benefits:
- Payment data is securely encrypted and transmitted through secure channels. Clients trust the service which does not transfer private information to third parties.
- Information about bank card details and payments is provided to the payment gateway, not to the e-commerce platform.
- Consumers of payment gateways do not need to spend money on special hardware and software. These issues are handled by payment service providers.
Obviously, a payment gateway is a means of providing fast, convenient and reliable online payments. The use of this technology guarantees the security of transmitting the information required for the transaction between the buyer and the seller. All data is securely encrypted using multiple keys inaccessible to third parties.
Success in e-commerce relies heavily on secure and seamless payments. The customer experience is also driven by convenience and reliability of online purchases. This all is ensured with a payment gateway.
Payment gateways vs payment systems
A payment gateway is a hardware and software infrastructure responsible for customer authorization, data encoding and payment processing. Thus, a payment gateway is a reliable link between buyer and seller.
A payment system is a set of tools that enables the acceptance of money. Usually payment systems and payment gateways are separate services, but reputable enterprises combine them sometimes. As a result, payment complexes are formed that are responsible for both the acceptance of money and the secure transmission of data.
Toda is a high-tech payment hub providing seamless and risk-free digital payment processing services.
The highest reliability is one of our company’s priorities. We provide 24/7 online payment acceptance from online stores, websites and mobile apps. TODA supports hundreds of deposit and withdrawal methods for a wide variety of currencies. Our service provides the highest level of payment security as it meets the strict requirements of the international PCI DSS standard.
If you contact our team of experts, you will get comprehensive information about the benefits of working with TODA. We will do our best to facilitate the growth and development of your business.