Payment Gateway Integration with your Website: Best Practices

27/08/2021

What is a Payment Gateway?

643.9 million Indians make online or digital payments. Research also projects the total transaction value of e-commerce to reach ₹8,870,584 million in 2021. The surge in online shopping, widespread usage of mobile phones, easy access to the internet, and the Digital India campaign launched by the Indian Government have contributed in their ways to popularize online or digital payments.

It has now become a business need for retailers to provide online payment options to their customers. If you too want to introduce the option for digital payments in your website, then you would require a Website Payment Gateway, which is a software application that authorizes payments. It connects the bank to your website so that money can be safely transferred online from your customers’ bank accounts to your bank account or eWallet.

How do Payment Gateways Work?

You can easily integrate a payment gateway in your website by opening a merchant account at your local bank and then linking it to a payment gateway of your choice with the needed security controls. Most of the payment gateway integrations may use the same mechanism, which usually includes the following series of approvals and communication between different facilities:

After the customer places the order, they head towards completing the payment.
The customer provides their credit/debit card details.
All payment details are encrypted by the payment gateway for security reasons.
The encrypted details are sent to the acquiring bank and then to the customers’ card association (for example, Visa or MasterCard) which then routes it to the customer’s bank.
The customer’s bank checks if the account balance is sufficient to cover the amount requested.
After approving or declining the request, a code is sent by the customer’s bank to the payment processor to convey the same.
This response is communicated by the payment processor to the payment gateway, who further passes the response to the website.
The website conveys this response to you and your customer.
If the customer’s request to pay is approved then you need to authorize your bank via payment processor to accept the amount.
The bank deposits the approved funds to your seller account or merchant account connected to your payment gateway.

Though the flow is quite complex and looks lengthy, the entire process is usually completed within seconds.

Benefits of Using a Payment Gateway

If you are still not sure, whether you need to integrate payment gateway to your website or not, then perhaps the following benefits can help you make up your mind:

Secure Transactions

88.05% of online shopping orders were abandoned in March 2020. A great number of these abandonments occur because the customers are not confident about the safety of their bank details. Considering the rising numbers of online frauds, this fear sounds reasonable too. Since payment gateways encrypt the payment details shared by you and your customers, integrating them can help you protect sensitive data better.

Faster Transaction Processing

Online buyers can be impatient. 57% of online shoppers abandon their online shopping cart if they have to wait for more than 3 seconds for a page to load. This indicates that even if customers like your product, you can end up losing them if payment processing takes a long time.

Payment gateways complete a series of authorization within seconds. They can also remember and store the needed details (not passwords) for future payments. Thus, integrating a payment gateway with your website can easily speed up transaction processing.

Added Convenience for Customers

A complicated checkout process can make 26% of customers drop their plans to purchase from your website. Payment gateways do involve complex processes but these processes run in the background. Your customers do not need to do anything apart from entering their card details and approving the payment request from their mobile phones. This makes paying online very easy for them and improves their overall buying experience.

Saves Time and Efforts

Website payment gateways can also be linked to your invoicing and accounting software. This can automatically update the corresponding invoice in your bookkeeping system when an online payment takes place. This may reduce your burden of manually updating the payment in your accounting system and save you time and effort.

How to Select Payment Gateway for Your Website

Payment gateways deal with your and your customers’ personal and financial information. Thus, selecting a reliable payment gateway for your website needs careful consideration. Here are a few things that you can keep in mind when you select a payment gateway for your website:

Check Platform Compatibility

It is necessary to have a website payment gateway that easily connects with your invoicing and accounting software. This can ensure that when a customer purchases a product it automatically reflects in your bookkeeping system.

Research estimates that every third Indian purchases goods online using a smartphone. So the website payment gateway should support mobile payments as well. This will give your customers the flexibility to pay from their choice of device.

Calculate Costs of Using Payment Gateway

One of the most important factors to consider before choosing a payment gateway is its total cost. The costs of integrating a website payment gateway include the set-up fee, monthly charges and transaction fee. You should always look for the most cost-effective website payment gateway since high transaction fees and monthly fees can greatly increase your expenses.

Evaluate Security Controls

Online payments may be risky for you and your customers since payment gateways store sensitive financial information. Thus, your website payment gateway should always follow the best security standards. The payment gateway chosen by you should ideally be level -1 PCI DSS compliant and should come with fraud detection and other screening tools to protect you and your customers from fraudulent transactions.

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