To begin with, it is an unnoticeable fact that online payment methods have taken the world by the storm. Even for the smallest amount, we think about transacting wireless these days. And it is not just about the debit or credit cards we use, but various modes of transactions like UPI, net banking, e-wallets are in the big game of payment industry. There is not one but many reasons to why people believe in transacting online these days rather than handling cash.
Online payments are quick and happen in a blink of an eye, is also hassle-free and more secure. Online payments are used mostly in every walk of life these days. Whether you are an e-merchant, a friend, family, or anyone living across any part of the world you can easily send or receive money.
But the whole question revolves around the fact, what is a payment gateway. The answer to this question is very simple. In layman terms, the payment gateway could be defined as the channel through which the people on the receiving end and the sending end are connected. More technically speaking it is a third party software that authorizes you to send your payment from one point to another. Taking an example, you shop from an e-commerce website and choose to pay online. The transaction is carried out smoothly with the help of a payment gateway that securely transfers your amount to the seller.
How does a payment gateway work?
It is a very simple process yet intriguing in nature. As soon as a customer creates an order on any website or any application an order id is created when the customer clicks the submit or pay button. The order id is carried in an encrypted form to the merchant’s browser. The encryption is done through a secure socket layer or otherwise known as the SSL. After this, the merchant forwards the payment details to the bank. After receiving the details the bank sends a response code to each query to the payment gateway. The payment gateway on receiving the response forwards the code to the merchant as well as the customer. The approved batch authorizations submitted by both, the customer and the merchant, leads to the payment. The payment gateway acts as the link between both ends. The whole process takes between seconds and is usually smooth such that no error occurs.
Five most promising payment gateways of all time:
With such a wide range of payment gateways, it becomes a tat bit difficult to choose anyone with a higher edge. So here are the five most promising ones that will help you receive or transfer money within a fraction of a second.
- Paypal: The most common gateway error that every existing human being on this earth knows is Paypal. You can send or receive money globally through Paypal. Paypal is an American company that uses electronic methods to transfer money kicking the traditional paperback methods like cash, cheques, and money orders to the curb. Paypal usually works using an ACH transaction method in which by delivering an ACH file which contains the details like what amount has to be paid through which bank? What is the token id that has been allotted to the particular person? After that, the details are matched to the bank and the response is carried out resulting in the complete transaction. Paypal does not charge its customers for any transactions and it is also free of cost to sign up on Paypal. The money received in your Paypal account can be withdrawn to any bank. Paypal is encrypted and uses anti-fraud technology to carry out the transactions smoothly. And also if a foul play is detected in your Paypal account it automatically sends you an activity notification to know if it was you, locking frauds out of your payment activity.
- STRIPE: stripe is another American financial payment gateway with its headquarters in San Francisco, California. Stripe provides payment processing software and application programming interfaces for various e-commerce websites as well as mobile applications. Stripe’s payment gateway is popularly known as payment by Stripes which allows you to transact using credit cards, debit cards, mobile wallets, and various other methods from around the world. It also provides a 3D secure 2 authentication card, where your money is protected by a two-step verification ensuring that it is you, who is making the transaction. Stripe requires verification of your identity before you move forward with any transactional processes. They have various KYC or know your customer guidelines just like any other payment gateway.
Stripe does not send your entered credit card details to the server rather than that the details are directly stored into stripe which means no loss of your details would occur if someone tries to breach your server and steal your details. Amazon has partnered with stripe making it a huge engagement to quietly process a large section of the e-commerce payments throughout the world.
Stripe also charges its customers a transaction fee of about the sending and receiving money, however, stripe does not charge a monthly fee from its users.
- Apple pay: Apple pay is the mobile wallet by apple for transacting cashless. Apple pay allows its customers to pay in person, through mobile wallets, payment on web browsers, and also all IOS applications. Apple pay uses a Near Field Communication chip (NFA) which is embedded in your apple devices. You just have to hold your device near a card reader to opt-in for touchless transactions. Apple pay can also be used to make a one-touch payment you can use Apple pay almost everywhere and it also does not charge transaction fees from its customers. Unlike, debit or credit cards for touch-less transactions Apple pay does not have any limit on the number of transactions that you make. You can make as many as transactions you feel like.
The money that is received in your Apple pay wallet can be also sent to your bank account you just have to enter your bank details in the wallet section and click on send. Apple pay is quite an interesting wallet as it allows you to transact even if you do not want to add a physical debit or credit card. Apple pay lets you add a virtual debit or credit card for the same purpose. And also, Apple pay is password and fingerprint secure, which means nobody could break into your money without having your fingerprint. That is what makes Apple pay the most secure.
- Adyen: Adyen is a dutch payment gateway that allows businesses to transact e-commerce, point of sale, and also mobile payments. It has over 3500 employees and is also listed in the stock exchange market under Euronext Adyen is used the most in e-commerce websites. It is also the primary payment partner for eBay. Many other stores like ZARA, Lacoste, and crocs now use the Adyen platform. What makes Adyen so unique is that it uses one platform for the purchase in online stores, desktop as well as physical stores which makes it quite easier to detect any fraudulent transactions. It also offers loyalty points and checkout discounts to customers. Adyen’s primary source of income is through transaction charges. On every amount, it deducts a transaction fee. The statistics show that Adyen has processed over 130 billion euro worth of payment during 2015-2019. Adyen has been such a huge success because it delivers a unified platform for all needs. Merchants can track centralized customer data and can make one integrated platform for the backend and one contract.
Adyen supports over 250 payment methods and 187 valid currencies making it the most used payment gateway in almost over 20 countries including the United States and France. Adyen was ranked 10th position in Forbes’s top 100 cloud list and has a net worth of $2.3 billion making it the sixth-largest in Europe.
- net: Authorize.net is a United states payment gateway that can be used to transact money online through credit cards and a valid IP connection. You can use any visa, Mastercard for authorize.net however it does not accept payment through any debit cards with pin protection. The merchant account on Authorize.net is not a merchant account and has no termination contract. It is strictly a payment gateway that can be used to transact online through credit cards. Authorize.net, however, levies a transaction fee of 2.9% + an additional amount of $0.30 on every transaction that you make through the gateway. Above all this, Authorize.net will charge you monthly payment fees that are around $25 and also a $49 setup fee for using it as a payment gateway. Authorize.net is one of the safest payment gateways to rely on. It has been handling transactions since 1996. They also offer a fraudulent suit detection to ensure that your money is being transacted through safe hands.
Money if transacted through safe hands can be a benefit to everybody. Therefore before using any payment gateway you should do a little background check, to be fully sure that your money is protected.