Finding the ideal payment provider to meet your demands is one of the biggest obstacles for merchants pursuing international markets. In order to choose the right payment gateway provider for your company, it can be useful to explore the market first.
A third-party service known as an online payment gateway enables a merchant to accept payments on their website. Software is essentially what transfers the details of the transaction from the issuing bank to the acquiring bank, indicating whether it has been accepted or rejected.
Payment processor vs. payment gateway
Perhaps while they both fall under the umbrella term “payment solutions,” a payment processor differs from an online payment gateway, despite the fact that you may have heard both names and even used them interchangeably.
A payment processor transmits all required information pertaining to the credit or debit card used in the transaction as it transports the funds from source to destination: from the issuing bank to the merchant bank. The sole service required when a consumer uses a physical card to make a purchase at a physical store is a payment processor, which is likewise utilised in traditional retail.
A transaction is authorised by an online payment gateway, as opposed to a payment processor. In eCommerce transactions where businesses may also need to accept payment methods other than cards, it is essential.
So, how do you choose the best payment gateways for your business?
You must start with your business’ needs before analysing payment gateway lists, then go on to the online payment gateways that best meet your needs.
Consider the following while evaluating the top payment providers:
Security
One of the biggest risks to eCommerce is the security of transaction data, thus your online payment gateway needs to come with a number of security safeguards by default. Your payment gateway should assure compliance with payment industry standards in order to process credit and debit cards; in this regard, make sure that it has a PCI DSS certification. To reduce fraud attempts on your online store, a good payment gateway also has extensive fraud prevention measures.
Features
Another thing to look for is that your checkout accepts the chosen payment methods of your customers. Look for the most widely used international payment methods, and if you’re aiming for a certain local market, see if your prospective payment gateway supports transactions using those. Although debit and credit cards as well as eWallets like PayPal dominate global preferences, purchasers may prefer local alternatives and with so many competition in the market, you may need to look for specific option with distinctive features that will attract your target audience. To cater to these preferences and achieve desired conversion rates, your firm will need to make adjustments.
For example, a DTC e-commerce business may choose to use Skrill due to its low fees and the possibility of allowing over 40 currencies to access and manage your transactions. A small business whose main income comes from a physical store may opt for credit and debit cards like Visa due to their convenience and purchase protection. On the other hand, large international businesses like those in the online betting industry may gravitate towards PayPal due to the features that such PayPal betting sites have — like instant deposits and fast withdrawals in such a case. It all depends on which features you’re prioritising for your audience.
Cost efficiency
Most payment gateways have a price, which is typically expressed as a transaction fee. Look at the features you are getting for your money to determine if the price is fair.
Online payment processing through basic providers could be affordable or even free, but in the long run, the extra costs might exceed the immediate advantages. It could be worthwhile to use a reputable online payment gateway from the beginning if you need to make further investments in compliance or security measures.
Billing features
Your online payment gateway should allow recurring billing if you now offer subscriptions or plan to do so in the future. This feature is necessary so that customers don’t have to manually renew their subscriptions every month or billing cycle.
Allowing consumers to interrupt their subscriptions or offering dunning management tools are two other subscription payment features that may assist you keep your low churn rate.
When you need to compare online payment gateways, going over each of these points will help you decide which one is best for your company. Consider the features you require, the integration model you can support, and whether you choose to outsource security management or keep it in-house.
