Online Payment Processing: What You Need to Know to Get Started

To put it simply, the online payment system is directly a system of paying for goods or services using electronic means and software. With the demand for modern technologies and their active development, the popularity of online payments is growing every year and forecasts from experts predict even more growth in the use of online services. According to statistics, digital wallets will become the most popular payment method by 2026, and the predicted percentage of use is 54%. This is followed by payment by credit card (16%) and debit card (10%). Considering that business owners are dealing with sensitive data, they should pay attention to software that provides quality and reliable online payment. So, in this blog post, we will explain how to choose your payment getaway and determine the payment methods that are most suitable for your customers.

Setting Up a Payment Gateway

Payment Gateway is a service that makes various payment methods available on the platform. One of the most popular payment gateways among developers is Stripe. For example, we most often use Stripe in developing a SaaS project. Because it has a flexible system for setting up subscriptions, their number, set value, and limitations that the subscription removes. Next, subscriptions are connected to the system and used in development. Almost all payment getaways have ready-made solutions and integration modules for various platforms. Let’s assume you have an online store on WordPress, where a customer wants to accept payment. In a few clicks, without programming, the Authorise or Stripe or PayPal payment module is installed – and you can buy goods on the site via  this or that payment method.

How a Payment Gateway Works

Payment gateway, which is used by commercial web solutions, operates according to the following algorithm:

• the client enters the site and purchases by pressing the “Buy” button;
• the gateway connects to the bank and checks the availability of funds so that the purchase price does not exceed the amount of funds the user has;
• the gateway sends encrypted credit card data for the transaction;
• the transaction is carried out and approved by the program;
• the gateway sends the bank information about the transfer of funds from the bank to the website.

How to Choose the Right Payment Gateway for Your Business

The choice of payment gateway should depend on the size and basic needs of the enterprise, especially if they consider the option for credit card payments. Companies should pay attention to such key factors as:

• Price and monthly payment. This includes percent for each transaction and monthly payment at the specified rate. Using payment getaways, companies can pay between $25 and $50 per month, but some services do not charge a monthly fee. Meanwhile, the average commission percentage for each transaction is approximately 2.9%. When choosing the desired service, you should also pay attention to such key factors as a free trial version, the presence of a hidden commission, the presence of a fee for installing the application, etc.
• Payment methods. Payment getaways must contain all available functions for carrying out the payment method that you have chosen for yourself, depending on the needs of your company and customers.
• Security. The security of data protection should be one of the most important criteria, especially when it comes to finances and sensitive customer and business data. A quality payment gateway must meet all the important criteria of security protocols like PCI DSS.
• Payment gateway type selection. There are three types of payment gateways: redirect solutions (when the client is transferred directly to the service during payment), off-hosting (where the data is stored outside the web solution itself), and self-hosting gateways (when the data is on the web itself projects). As experienced developers, in compliance with all international protocols, we recommend choosing services that allow you to store data on the side, because these solutions are more secure and have better mechanisms for protecting confidential data. According to a similar scheme, we developed the Groovv retirement payment service based on Stripe, which is an off-hosting solution.

How to Choose the Best Payment Gateway Your Business

Here, we provide examples of the most popular payment gateways. To choose the right tool, we recommend paying attention to the key characteristics.