Selecting a Payment Gateway

What are Payment Gateways?

Businesses big and small are being urged to jump onto the Internet bandwagon for unlimited customers ready to shell out for products and services online. But when it comes to actually processing orders, there’s a lot of complexity involved.

The first problem in this context, is likely to be with the shopping cart. A customer may desire to use American Express to make a purchase while your merchant account handles only Visa. This is the reason you should mention the cards accepted. Then your shopping cart software may not be compatible with your payment processor.

For fast money transactions, nothing beats having your own credit card processing software. However the costs, monthly charges and other fees can be impractical for the smaller businesses.

Take heart because hope comes with payment gateways. These are super speed online services with huge redundancy and reliability measures plus backup in one of the most advanced data centers of today. A seamless process, it doesn’t even require your customer to interact directly with the gateway as data is forwarded through your shopping cart and a secure SSL connection.

Electronic fund transfer point of sale terminal or EFTPOS, is an online process of checking validity, encryption of transaction details, ensuring delivery to correct address and decryption of responses that is routed back to the shopping cart. Newcomers prefer to use a payment gateway for processing credit cards. The step-by-step instructions guide you in making your website credit card enabled. Essentially, a third party takes care of the entire credit card processing for you.

Standing at the Gateway

The payment gateway automatically batches the transaction or a batch is created by the merchant. Batch refers to a group of transactions in a specific duration of time, usually at the end of the day or auto batched at a specified time.

The transaction is then forwarded to the processor. This is when the credit card bank gets a notification to charge the account. The money is then kept in the online merchant account until it is sent to the account-holder’s regular bank account via an electronic funds transfer (EFT).

Selection of a suitable payment gateway or bridge, is among the most important E-Commerce decisions that links your website to your bank’s credit card processor. A wrong choice can be fatal. Make sure you find out about all options, check to see if they work together, find out about integration of merchant account with transaction gateway, processor and shopping cart.

Payment Gateway Issues

Browse through options, compare rates and read the fine print to make sure you choose the right one.

  • In case you have already bought a shopping cart package, find out about its compatibility. In case there isn’t check with the vendor about the chances of supporting the payment gateway services.
  • If shopping cart purchase is due, ask the payment gateway provider for a list of supported applications. Stay away from gateways with great pricing but limited range of supported shopping carts, which can cost a lot.
  • The gateway must offer Address Verification System (AVS) protection, which minimizes fraud through the customer’s billing address. The other advantage is the likelihood of reduced fees by your merchant bank.
  • Find out the types of transaction protection being offered, which may be premium services with charges added to the basic fees. If your product is youth or technology oriented, it’s advisable to pay extra, to avoid chargeback rates on fraudulent transactions of almost US$ 30 per incident.

The worldwide reach of the Internet is best utilized to your advantage with a system that enables credit card payments for supporting international clients as well. Payment processing services ensures security for customers to give out their credit card details online.

Pinnacle Cart offers integration with the nations top payment gateway providers. For more information, click here.