What is a payment gateway?What does the payment gateway include?

We explain the importance of payment gateways in the payment process as part of our Inside and Out series on understanding credit card processing.

The payment gateway sits between the merchant and the processor, which transmits the transaction to the network (Mastercard, Visa, American Transit, Discover, etc.). The role of the payment gateway is a secure information conduit that complies with the security rules and regulations for credit card processing. Once the card information is entered, the payment gateway transmits the card data to the network, which authorizes the card issuing bank.

Most payment gateways complete these steps in seconds.

Encrypted. The payment gateway encrypts data (privately encoded) between the user's browser and the retailer's server for use by both sellers.

Request. When a payment processor approves a transaction with a credit card company, financial institution, or financial institution.

Execute. After the payment gateway is authorized, the website and interface are allowed to proceed to the next step.

All of this happens in the blink of an eye, using encryption to ensure secret cardholder information is never exposed. Payment gateways work in all payment environments: desktop, mobile, brick-and-mortar, brick and click, and even support speech recognition. The white standard gateway option even allows you to apply a graphical user interface (GUI) or page template online, creating a seamless branded experience for customers contacting your company or organization.

What does the payment gateway include?

In addition to the basic functionality of transmitting and receiving credit card transaction data over the Internet, most payment gateways include some useful extras. When choosing a internet payment gateway, the following features should be considered.

Payment information storage. No customer wants to be able to re-enter credit card information every time they place an order. When they visit your website again, a customer information database is established for payment information storage. Best of all, the gateway encrypts this information and stores it separately from your website. This provides an extra layer of security for your pCI compliance requirements.

Encrypted. All payment gateways encrypt sensitive credit card information before passing it on. It would be even better if the gateway also provided tokenization.

Virtual terminal. Virtual terminals are browser-based versions of physical credit card terminals. A virtual terminal allows you to enter your customer's credit card information and process the transaction directly from your computer's web browser. Mobile devices including smartphones and tablets can also set up virtual terminals. In a retail setting, you can add a USB-connected credit card reader and use a lower credit card processing rate (or hold the card).

Compliant with pCI standards. Currently, some gateways in the market simplify pCI compliance for e-commerce merchants. Transactions take place on the gateway provider's servers, not on the server hosting your website. Since the gateway interface is integrated into your website, customers never need to leave your website to complete their order. You don't need to maintain a secure network to meet pCI standards (of course, it's still a good idea).

Api tools and developer information. One of the most attractive features of payment gateways is that they are usually plug-and-play, which means you can set them up on your website without any coding required. On the other hand, if you are a skilled software programmer (or you have a web developer doing it for you), most gateway providers will provide some APIs (application programming interfaces) that will allow you to customize on your website Gateway function. Each gateway vendor has its own unique set of APIs that you can access.