Key Factors Involved in E-commerce Payments
Are you looking for an online payment gateway in Philippines? Before you begin your search, you need to know how an e-commerce payment or transaction works. This knowledge will help you sift through the numerous payment gateway providers out there and choose the best one for your business.
What is an E-commerce Transaction?
Basically, an e-commerce transaction refers to the movement of money from the customer to your bank account through the payment gateway on your website. According to the Organisation for Economic Co-operation and Development (OECD), an electronic transaction is the sale or purchase of goods or services, whether between businesses, households, individuals, governments, and other private or public organizations, carried out on computer-mediated networks. The services and goods are ordered through these networks, but the final payment and the eventual delivery of the services or goods may be handled online or offline.
The entire process can be quite complex with numerous parties and financial organizations involved in completing each transaction. Therefore, it is importantto study all the elements properly before going ahead.
What are the Factors Involved?
An e-commerce transaction involves three main factors:
- The Customer
As the popular saying goes, “the customer is king”. You should be aware that your customers will be using different payment methods – credit cards, debit cards, mobile payments etc., either through a computer or a mobile phone. Further, they might be paying from an international location. The ecommerce solution provider that you choose for your payment gateway must be able to meet the demands and preferences of your customers. It should not only support all kinds of payment methods but also support multiple international currencies.
- The Merchant
In this case, you are the merchant. To be able to receive payments through your website, you need to collaborate with a merchant bank, which will accept payments on your behalf and deposit them into your merchant account.
- The Technology
This is the most important part of the entire transaction. The technology used by your e-commerce solution provider will determine the success or failure of your business. Seamless transactions lead to repeat customers for your website.
There are two parts to this: Payment Gateway and Payment Processor. The payment gateway is the software on your website that connects the customer, your website and the banking network. The payment processor works in the background to ensure that the entire transaction passes off without a hitch.
As you begin your search for an online payment gateway in Philippines, it is imperative that you should understand all the nitty-gritty of e-commerce payments and transactions. We advise that you get in touch with a local and well-established professional e-commerce service provider who can hand hold you through the entire process and help you establish your business.< Next post - Payment Solutions that Drive E-Commerce in Southeast Asia Prev post - How to Choose a Payment Gateway Service Provider? >