What is a payment gateway?
A Payment Gateway is the middle party between your online store and the acquiring bank or acquirer that receives payments from your customers. In other words, once a customer enters their payment details on your website, the payment gateway is responsible for sending payment data securely (using encryption) to the Acquirer to seek payment authorization. Once the payment is authorized, online store will be informed instantly and then kick start the order fulfilment process.
If you run an e-commerce business and are interested in accepting credit card payments online, you need a payment gateway. It’s actually the bridge between your product sales and your customers.
But how to choose a good payment gateway? Here are the criteria you may look into it when choosing the one.
Payment gateway charges merchants a variety of fees such as sign-up or application fees, monthly or annual fees, transaction fee, refund fee, cancellation fee, chargeback fee, cross border fee, etc. In fact, many merchants only choose payment gateways based on a single criteria – pricing. Cheapest definitely is not the best service offered. Both Follow Me and L’OCCITANE offer shampoo but the pricing gap is huge. Do you think they offer the same benefits and quality?
Most people say that they will choose a large provider because they are more stable. However, sometime you also will experience downtime with system offered Internet giant like Google and Facebook. No one in the world can offer 100% uptime. In fact, smaller providers can offer more decent or tailored services than larger providers. They will be more flexible to accommodate their customers’ needs. Besides, payment processing is obviously critical to your business, so you need to work with a payment gateway which is regulated by the authority like central bank.
C. Application Process
Speed is one of the key success factors in business. The purpose of applying for a payment gateway service is to receive money quickly and avoid losing sales. Then, if the application process is slow like needs one to three months to get the facility, it definitely will slow down your business speed and then affect the business growth.
D. Merchant Support
Even if a provider can give you the cheapest price in town, but no one cares to solve your problem when occurs, are you ok with such service level? A lot of times what we really buy is the support. Look at Haidilao steamboat, do you know why are so many people queuing up to go? Just a steamboat that you can get anywhere but not their service experience. Choosing a provider with attentive support is the ideal way to support your business growth in long run.
by Terry Yee, CEO and Founder of Axaipay
4 August 2022