The growth of eCommerce has resulted in a greater need for efficient and seamless payment options that are accessible to customers. Payment gateways have become an essential component of the eCommerce ecosystem, enabling businesses to accept payments securely and reliably. A payment gateway is a software application that connects an eCommerce website with the payment processing network, enabling businesses to accept payments from customers.

Choosing the right payment gateway is crucial for the success of an eCommerce business.  It is important to select a payment gateway that is compatible with the eCommerce platform being used and supports the payment methods preferred by the target customers.

In this article, we will discuss the features to consider while selecting the best payment gateway for your e-commerce website.

The Best Payment Gateway for E-commerce 

Here are some of the best payment gateways for E-commerce:-

Paypal 

Paypal is a trusted payment gateway that is widely accepted and recognized by customers globally. It offers a simple checkout process and supports multiple payment methods and currencies. Additionally, it provides features like fraud protection, dispute resolution, and seller protection.

Stripe

Stripe is one of the most popular payment gateways for e-commerce businesses due to its user-friendly interface, seamless checkout process, and extensive developer tools. It supports a wide range of payment methods and currencies and also provides features like fraud prevention, subscription management, and invoicing.

Square

Square is another popular payment gateway that offers simple and secure payment processing. It supports a wide range of payment methods, including credit cards, debit cards, and digital wallets. It also provides features like fraud prevention, chargeback protection, and recurring payments.

Authorize.Net

Authorize.Net is a payment gateway that is known for its reliability and security features. It supports a wide range of payment methods and provides features like fraud detection, recurring billing, and customer information management.

2Checkout

2Checkout is a payment gateway that supports multiple payment methods and currencies, making it a great option for businesses with a global customer base. It also provides features like fraud protection, subscription management, and customizable checkout pages.

How Does Payment Gateway function for eCommerce

Here are the steps for how a payment gateway functions for eCommerce:

  1. Customer selects products and proceeds to checkout:- You have to select the specific product and then proceed by clicking on the Checkout button.
  2. Customer enters payment information:- Then, there will be a form for filling in your card details. Make sure, you will fill it out correctly. 
  3. Payment information is sent to the payment gateway:- When you fill in all the information of your card details, then your information will be sent safely to the payment gateway.
  4. Payment gateway sends a request to acquiring bank:- After that, the payment gateway sends your request safely to your acquiring bank.
  5. Acquiring bank approves or declines payment:- After receiving your payment information from your acquiring bank, they approve your payment or decline.
  6. The payment gateway receives a response from acquiring bank:- After receiving the response from your acquiring bank.
  7. Website completes transaction:- Then your payment will be completed.
  8. Funds are transferred to the merchant account:- After the payment completion, the funds are transferred to the merchant account.
  9. Payment gateway charges merchant fees:- According to your selected products, the payment gateway charges merchant fees.
  10. The merchant receives payment:- Then the successful merchant receives the payment.
Payment Gateway Process
Payment Gateway Process

What is the Payment Gateway Process?

The Payment Gateway Process is the series of steps involved in processing an online payment transaction between a customer and a merchant. It typically includes the following stages:-

  1. Customer places an order: The customer selects the items they wish to purchase on the merchant’s website and proceeds to the checkout page.
  2. Payment information is entered:- The customer enters their payment information, which includes their credit card, debit card details, billing address, and shipping information.
  3. Payment information is encrypted and transmitted:- The payment information is encrypted using secure sockets layer (SSL) technology and transmitted to the payment gateway for processing.
  4. Payment gateway verifies information:- The payment gateway verifies the customer’s payment information, including checking that the customer has sufficient funds in their account to cover the transaction.
  5. Payment is authorized:- If the payment information is valid, the payment gateway sends an authorization request to the customer’s bank or credit card network, requesting approval for the transaction.
  6. Payment is processed:-Once the payment is complete, the payment gateway sends the transaction details to the applicable bank or credit card network for processing, and the funds are transferred from the customer’s account to the merchant’s account.
  7. Payment is confirmed:- The payment gateway sends a confirmation message back to the merchant, indicating that the transaction has been completed successfully.
  8. Merchant completes the order:- Once the payment is confirmed, the merchant can complete the customer’s order by shipping the goods or providing the services they have purchased.

Best features in a Payment Gateway for your E-commerce

  1. Security:- Security is the most important part when selecting a payment gateway. Customers want to feel safe when they share their financial information online. Therefore, make sure which payment gateway you will choose has strong security measures such as data encryption, fraud detection, and prevention.
  2. User-friendliness:-  A payment gateway is very easy to use at any time and anywhere. Through the payment gateway, it is very easy to complete the payment process, so customers should not be redirected to a third party. The payment gateway should also be easy to combine with your e-commerce platform.
  3. Transaction Fees:-  Different payment gateway providers charge different transaction fees. It is essential to compare the fees of different providers to ensure that you choose one that is affordable and within your budget. However, do not compromise on security and user-friendliness for the sake of lower transaction fees.
  4. Compatibility:- The provider should offer plugins or APIs that allow for easy integration with your website. Additionally, make sure that the payment gateway accepts the types of payments that your customers prefer, such as credit cards, debit cards, and digital wallets.
  5. Customer Support:- Technical issues can arise at any time, and it is crucial to choose a payment gateway provider that offers reliable customer support. Look for a provider that offers 24/7 support via email, phone, or chat. 
  6. Reputation:- Look for reviews and testimonials from other businesses that have used the provider’s services. Additionally, check if the provider has any history of security breaches or payment processing issues.

Overview

With the right payment gateway, you can provide your customers with a seamless payment experience while ensuring the security of their sensitive financial information. Here are the steps:-

  1. The customer selects products and proceeds to checkout
  2. The customer enters payment information
  3. Payment information is sent to the payment gateway
  4. The payment gateway sends a request to acquiring bank
  5. Acquiring bank approves or declines the payment 
  6. The payment gateway receives a response from acquiring bank
  7. Website completes transaction
  8. Funds are transferred to the merchant account
  9. Payment gateway charges merchant fees
  10. Merchant receives payment

Also Read More: Best 5 Safest Ways for Inter-Bank Transfers in India