Want to move part of your inventory online? Or perhaps you take phone orders and use a virtual terminal for card not present payments. Bottom line is, you are going to need both a payment gateway and merchant account if you want to sell something online or engage in ecommerce. Understanding their roles will take the mystery out of online payments.
Today, we are going to look at Payment Gateway Services
In an online environment, the cardholder usually checks out via a shopping cart or payment page. The payment gateway's role (think Authorize.net, or Payflow Pro to name a few) is moving the transaction from the shopping cart to the processor in the most secure manner possible. This act shields the shopping cart from retaining and/ or storing cardholder information, depending on how the shopping cart connects to the gateway.
You typically accept the payment through a secure hosted payment form or a virtual shopping cart. They work like this:
- Your customer presses “order”
- The encrypted payment information goes to the payment gateway
- It then heads over to the payment processor
- Finally, it goes through the credit card network and gets authorized by your customer’s credit card issuer
Create a Wish List for your Gateway Provider
In the virtual world, gateways perform additional tasks like profile management, recurring billing, account updater and fraud detection. So depending on your needs, you may select one gateway over another.
Creating a wish list is nice…. For instance you may want to store profiles for repeat clients in your cart for recurring billing purposes. You may want to have those accounts update automatically when the card expires so the cardholder does not have to get an annoying email stating they are past due, and you get paid on time. Check out our blog "8(+1) Amazing Benefits of Recurring Billing."
To sum it up, a Gateway is a service that moves the transaction from your website to process and accept online credit cards transactions for you. Its job is to do this securely so you can sell online with minimal risks. It’s basically a point-of-sale terminal that you see in physical stores, only virtualized.