Introduction

In an e-commerce portal, the average cart abandonment rate is 69.57 %. There are a lot of factors that can be altered to reduce this number.

These factors can be :

Displaying a clear call to action.
Continuous reminders of cart contents.
Multiple payment methods.

A good payment gateway can gradually reduce this number, leading to more and more conversions.

So let us start today with what is a payment gateway, what merchants need to know about payment gateways, types of payment gateways and some of the best examples available for e-commerce business portals.

What is a payment gateway?

A payment gateway is a system that connects a bank account to a related payment processor. It will transmit transactions virtually or through web payment services, even personally through a payment terminal or APIs. This payment service will authorize different modes of online transactions like credit cards, debit cards, internet banking, UPI and other types of digital wallets.

A new business owner needs to take into account the necessity of payment gateways. It guarantees smooth transactions and secure payments as well as protection of sensitive data. A lot of payment gateways come with screening tools for frauds like CVV, OTP verifications, address verifications to reduce the risks of loss of information and any kind of theft.

The working of Payment Gateway

A payment gateway will assist you in authorizing and processing transactions between customers and retail merchants irrespective of online or offline stores. So let us look at the workflow of the payment process.

A customer completes a transaction at a physical store or places an order online.
The transaction is securely transferred by the payment gateway to the bank(Either merchants or acquirers).
The payment gateway later assesses which credit card/debit card provider issued the buyer’s card or banking information.
This transaction information is then routed by the payment gateway to the accurate payment switch.
The transaction request is sent to the issuing bank by the payment gateway as well as the information to the credit card network or debit card provider bank.
Banks also run this transaction procedure through their fraud detection tools or processes. This leads them to conclude whether the transaction is legitimate or not.
At last the issuing bank approves or declines the transaction based on the data and sends that information through the credit card network, debit card bank to the merchant’s bank as well as the payment gateway.

Different kinds of Payment Gateways

Hosted Payment Gateways

It is a simple redirection gateway that directs the customers away from the site’s checkout page. The customers are redirected to the Payment Service Provider by clicking this link. The customer will fill out their payment information and then they are routed back to the merchant’s website to complete the checkout process after they have ordered. These hosted payment gateways can be customized according to your needs, they are fully secure as the transactions are PCI compliant and protected by fraud safety tools.

API hosted payment gateways

With the help of Application programming interface gateways, the customers can input their credit card or debit card details directly on the checkout page of the merchant's website. The payments are handled efficiently using APIs or HTTP queries. This is a favourable gateway because it is customizable providing a complete overview of the customer’s journey and user interface. It also provides integrative capability with the freedom of using it on any kind of device.

Self-hosted payment gateways

This is a simple type of gateway where the payment information inside the merchant’s website is gathered from the customer. On requesting the information the data collected is sent to the URL of the payment gateway. A lot of payments need a particular format for the payment information whereas others need a hidden key. It is advantageous because it provides better customer service and the whole transaction is completed in a single location. The whole payment journey of the customer can be monitored by the merchant.

Local Bank integration gateway

In this kind of payment gateway, the customer is redirected to the website of the payment gateway (i.e the bank's website), where the payment and contact information is filled out by them. After that, the customer is redirected to the website of the merchant after the payment process is completed. Once it is redirected the payment notification data is sent. It is simple, very easy to install and is beneficial to small enterprises that require a simple one-time payment system.

Some of the most popular and well known payment gateways are mentioned below:

Razorpay

One of the most reputed payment gateways in India that allow the business to process and disburse payment with the help of its product suite. The advantage is that it provides access to all kinds of payment modes like net banking, credit and debit cards, UPI and also digital wallets like PayZapp, JioMoney, Freecharge, etc. It gives access to the highest level of technological integration at very economical prices. It supports all major e-commerce CMS systems like Shopify, Magento, WooCommerce, WordPress, etc. It also provides mobile application integration with the help of Mobile SDK’s for Android and IOS with Cordova or PhoneGap.

Razorpay - Best Payment Gateway for Online Payments - India

PayU

Pay U is a popular fintech company that imparts payment technology to various online merchants. It is a global payment provider. They assist millions of merchants to buy and sell online, extending the power of Technology into Finance. It is one of the best payment gateways to accept online payments with simple sign-ups, minimal development efforts and a swift onboarding process.

They support international payments as well as credit cards, offering multi-currency support as well. It supports all major e-commerce CMS systems. With the help of Pay U online payments can be accepted from all channels and devices through a single processing platform. There are various channels of acceptance of payment but all your transactions reconcile in a central location that is the Pay U payment gateway.

Lucent Innovation has worked with Pay U and especially for merchants utilizing Pay U to build a refund management system that allows the merchants to provide refunds in bulk to customers. This saves the merchants a lot of time allowing them to focus on the strategic growth of their business.

Paypal

It is a popular global payment platform that is available in multiple countries across the world. It helps e-commerce stores to support multiple countries. The annual maintenance charges of Paypal are zero. It also offers multi-currency support and there are no withdrawal fees. They also support a great customer support system. It is one of the best payment gateways for International payments.

PayPal Business | Merchant Services for SMBs | PayPal IN

Unpay

Unpay is one of the finest one-stop global payment service providers and has its headquarters in Singapore. It utilizes cutting edge technologies to create a quite capable service network for payments that include everything right from remittance, payment gateways, foreign exchange settlement and many other services. They cover a lot of areas right from the cross border, public services, e-commerce, digital entertainment and many more.

Unpay has a lot of trusted users and it is a quite popular payment gateway. The audience that utilizes Unpay wants to make their payments through the same platform irrespective of the e-commerce platforms they use. Lucent Innovation has built a hosted payment gateway in integration with Shopify.

UnPAY - One-Stop Global Fintech Service Platform

Reepay

Reepay is one of the popular payment gateway acquiring services and a powerful subscription platform. It utilizes advanced cutting edge technologies and creates a competent service network for payments. It is perfect for any size of business whether small, medium or large. It is also a very reputed as well as stable payment provider.Reepay has a lot of trusted users and it is a quite popular payment gateway.

The audience that utilizes Reepay want to make their payments through the same platform irrespective of the e-commerce platforms they use. Lucent Innovation has built a hosted payment gateway in integration with Shopify to accommodate the audience and also build trust among the followers.

So these were some of the popular e-commerce gateways, for your information. So, now that you have set up an elegant and functional online store, when the customers try to initiate payments do not go through and the customers are stuck. Payment gateways can either prosper your business or dismantle it the same. So, you need to choose the right payment gateway that will provide the customers with a hassle-free experience.

Lucent Innovation will assist you in creating integrated payment gateways with your e-commerce store irrespective of their CMS system. We help you choose the correct payment gateway logically with reason and reputation. Each Payment gateway comes with limitations but they can be minimized or eliminated. Lucent Innovation helps you consider multiple payment gateways at the time of redundancy, also ensuring failsafe if one malfunction.

Lucent Innovation is a full-service software design and development company and an expert e-commerce solution provider. We create custom applications for our clients leading to an improvement in the efficiency, increased growth and profitability of the business. We also build e-commerce websites that are ready to sell, scale and grow.

Contact us for your next project!

info@lucentinnovation.com

Also, read: Neobanking- A fresh way of banking