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A Quick Guide to Choosing the Right Payment Gateway

November 24, 2020

A smooth online customer experience is often the result of a fast, secure, and easy payment process. Looking ahead, customer growth and retention are likely to be driven by high-quality and professional e-commerce payment gateways. The lifeblood of an e-commerce business is payments; thus, the success of your online store will largely depend on your choice of the right online payment solution.

What is a Payment Gateway?

The system and infrastructure that facilitates payments from your e-commerce store are termed an e-commerce payment gateway. It enables merchants to accept and manage payments and mitigate fraud in a secure way and helps to process transactions from a website. In simple terms, it can be thought of as a cash register for your online business.

What is a Merchant Account?

One will regularly come across the term ‘merchant accounts’ when looking into SEA online payment solutions. A special type of bank account for receiving payments from debit and credit cards is known as a merchant account. Since this is where the bank retains funds from credit and debit cards for a particular period of time, a merchant account sits separately from your normal account. As part of their normal routine, banks will then batch process these payments.

When thinking of a SEA online payment solution, there are certain main factors to be considered:

1. Payment Types
A number of payment types are processed by online payments. The most common are traditional key entry credit card or scheme debit card purchases; however, other options are now becoming popular. Alternatively, rather than entering shipping, billing, and card details, you can simply enter a password to complete a transaction made through recognized payment providers.

2. Currencies/Localization
Has your business become accessible to international consumers from several countries? Today, online retail business crosses geographic boundaries. With high cross border trade, the Asia Pacific market is of special importance. You need to ensure that you can process payment transactions, especially if you intend to ship to such markets. It is important to ensure that the gateway can connect to merchant banks and can process the currencies that you want to accept.

3. Hosting/On-form Payments
An e-commerce payment gateway can either be non-hosted or hosted. In a hosted gateway, your customer is redirected away from your e-commerce website at the payment stage. They will be redirected back to your store once payment has been made. These are easier to integrate and to set up. However, it disrupts the shopping experience and can affect the overall customer experience. This could lower your sales volumes since customers are often concerned when they are directed to the third-party hosted solutions.

4. Cost
For any business, this is most likely one of the main areas of concern. Since the cost can vary from vendor to vendor, when choosing an e-commerce payment gateway, there are several fees that you need to consider. There is often an initial set-up cost to cover the approval and integration to your merchant account. With regard to how SEA online payment solution vendors charge, there are a number of variations. For each transaction, there is a small percentage charged called the merchant discount rate.

All e-commerce businesses suffer from a growing issue, which is, unfortunately, online fraud. Your brand’s reputation and business can incur significant loss and damage from fraudulent activity online. Therefore, in the long run, it is wise to choose an e-commerce payment gateway that provides maximum security. Data encryption must be integrated into all online payment gateways.

Get in touch with leading providers who have ample experience and expertise in this area.