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Ecommerce Trends Ecommerce Trends, a blog regularly updated with trends in the eCommerce & marketing industry. The authors of this blog have decades of experience in their fields. Readers can seek extremely valuable information on Ecommerce Trends & Digital Marketing Strategies.

Everything To Know About Online Payment Gateway Integration

5 min read

Payment Gateway Integration

Do you know approximately 21% of visitors leave a website if it has a long and complicated checkout process and around 17% bounce back if the website is not secure? Thus, payment gateway integration is the need of the hour irrespective of what platform you are working on .

Integrating the best payment gateway to your eCommerce store enhances your website security and also improves the overall customer experience. Moreover, the provider should simultaneously satisfy the needs of the customers and your business.

If you want to explore details about a secure payment gateway, we have got everything covered.

Understanding Payment Gateway Integration

To understand payment gateway integration in simple words, it is a solution that connects your bank account with the merchant’s platform. Basically, it forms a secure tunnel for online buyers and retailers ensuring maximum safety for global purchases.

The payment gateways are very similar to virtual terminals which are equivalent to physical payment terminals. The payment gateway also ensures credit card processing by transferring the essential information between the website and the payment banks and vice-versa.

The best payment gateways for small businesses use security protocols and encryption to securely transfer data without any complications. It sends the data to the appropriate source for approval and then sends the response back to the store. It is during this phase that the payment is accepted and accepted or rejected and declined.

Working Of The Payment Gateway Integration

working of the payment gateway integration

While you plan to decide which payment gateway to use, it is important to understand its working. A payment gateway is a virtual bridge between the customer and the online store to process and authorize the online payment.

Below is the basic flow for an online payment using the payment gateway:

  1. As soon as the customers finish the purchase and click on the ‘submit’ button, they are directed to the payment gateway page.
  2. On that page, the customers choose the desired payment method and enter the required details.
  3. The entered details are then encrypted, for better security, and transferred to the issuing bank for approval.
  4. The issuing bank checks and confirms if the buyer has enough funds to make the purchase and sends the approval accordingly.
  5. The response is received by the merchants. If the response is negative, the transaction is canceled and if the response is positive, the transaction is completed.
  6. In the next step, the payment is settled between the secure payment gateway and the bank.
  7. Once this is done, the payment is finally settled between the payment gateway and the merchant.
Secure Payment Gateway

This may look like a lengthy and time-consuming process but it takes about a few seconds to complete. The process may sometimes be completed within 1-2 minutes because of technical issues.

This entire process is a combination of different transactional types which are,

  • Sale or debit
  • Authorization
  • Capture
  • Void
  • Refund
  • Chargeback, and
  • Credit

On the other hand, to ensure high security within the transactions, the eCommerce payment gateway uses technologies like TLS encryption, PCI-DSS compliance, tokenization, and 2-factor authentication.

What Are The Benefits Of Payment Gateway Integrations?

The eCommerce industry is growing with every passing year. However, with the growth, the industry is often prone to higher risks of fraud and risks. Thus, to maintain the needed flexibility and security for online payments, it is especially important to use the trusted payment gateway for small businesses.

The immense benefits of payment gateways make them a popular choice for the eCommerce industry. Below are some of the benefits that an eCommerce payment gateway can bring to your business:

1. Secured and Faster Transactions:

One of the best benefits that the online payment gateway ensures is faster and more secure transactions. The payment gateway secures the transaction by protecting sensitive data using encryption.

Besides, using the online payment gateways can boost the process of receiving payments by 50-times more than the normal traditional method. This means you can easily regulate the cash flow for your business without any hassles. It is done within seconds and thus, saves your time.

2. Minimal Cost:

As a surprise to many people, setting and using an online payment gateway is not an expensive affair. Thanks to the minimal initial cost of setup and specific transaction charges, getting started with a payment gateway is always within the budget.

3. Improved Sales:

As the online payment gateway is 24/7 available for use across the globe, it helps in improving the sales of your business. Moreover, as it reaches more customers it ensures boosting the revenue as well.

4. Fraud Detection:

Since online payments are at higher risks of fraud and cheating, using a secure eCommerce payment gateway also helps in fraud detection. As payment gateway integration is enabled with features like PCI-DSS and online fraud detection which further enhances the security of customers’ sensitive information.

5. Reduce Human Interference:

Last but not least, relying on the payment gateway automates online payment and thus, reduces human interference. This results in lesser risks of errors and reduced decline transactions.

Poor payment management is one of the prime reasons that can hinder the expected growth of your business. Thus, the online payment gateway can majorly contribute to improving your business’s performance and sales.

Benefits of payment gateway integrations

Hosted Vs. Non-Hosted Payment Gateway Integration

Soon after you have decided to use the best payment gateways, choosing between the hosted and non-hosted gateway is important. If you are also in a confusion to choose between hosted and non-hosted secure gateway, let’s first explore their basic difference.

Hosted Payment GatewayNon-Hosted Payment Gateway
It is handled by a 3rd party in exchange for a transaction fee.It is not handled by a 3rd party but hosted by yourself, also known as self-hosted.
Convenient and user-friendly.Completely customized.
Easy to setup and integrate.The website has full control on user-experience.
Requires minimal investment.Full control over the code and data.
User experience is externally managed and thus, cannot be fully controlled.Slightly expensive because of the infrastructure and technical support cost.
These are: PayPal, Amazon Pay, Stripe, SagePayThese are: Authorize.net, BrainTree, PayPal Pro, PayU, FirstData, MongoPay

To conclude it in simple words, as you use a hosted payment gateway, your customers will be redirected to the payment service provider page.

Related Article – How to Find the Best SEO-Friendly Web Hosting?

Best Payment Gateway

On the other hand, in the non-hosted payment gateway, the customers stay and complete the purchase process on the store owner’s checkout page.

Steps For Payment Gateway Integration With Your Website

Below are the following steps that you can use to integrate the chosen best payment gateway (we have chosen PayPal) with your website:

1. Start with creating a PayPal button:

<div id="paypal-button"></div>
<script src="https://www.paypalobjects.com/api/checkout.js"></script>


<script>
  paypal.Button.render({
    // Configure environment
    env: 'sandbox',
    client: {
      sandbox: 'demo_sandbox_client_id',
      production: 'demo_production_client_id'
    },
    // Customize button (optional)
    locale: 'en_US',
    style: {
      size: 'small',
      color: 'gold',
      shape: 'pill',
    },

    // Enable Pay Now checkout flow (optional)
    commit: true,

    // Set up a payment
    payment: function(data, actions) {
      return actions.payment.create({
        transactions: [{
          amount: {
            total: '0.01',
            currency: 'USD'
          }
        }]
      });
    },
    // Execute the payment
    onAuthorize: function(data, actions) {
      return actions.payment.execute().then(function() {
        // Show a confirmation message to the buyer
        window.alert('Thank you for your purchase!');
      });
    }
  }, '#paypal-button');

</script>

2. Now, Set up the basic payment:

payment: function(data, actions) {
  return actions.payment.create({
    transactions: [{
      amount: {
        total: '0.01',
        currency: 'USD'
      }
    }]
  });
}

3. Use the required additional parameters to extend the basic payment:

payment: function(data, actions) {
  return actions.payment.create({
    transactions: [{
      amount: {
        total: '30.11',
        currency: 'USD',
        details: {
          subtotal: '30.00',
          tax: '0.07',
          shipping: '0.03',
          handling_fee: '1.00',
          shipping_discount: '-1.00',
          insurance: '0.01'
        }
      },
      description: 'The payment transaction description.',
      custom: '90048630024435',
      //invoice_number: '12345', Insert a unique invoice number
      payment_options: {
        allowed_payment_method: 'INSTANT_FUNDING_SOURCE'
      },
      soft_descriptor: 'ECCHI 5786786',
      item_list: {
        items: [
        {
          name: 'hat',
          description: 'Brown hat.',
          quantity: '5',
          price: '3',
          tax: '0.01',
          sku: '1',
          currency: 'USD'
        },
        {
          name: 'handbag',
          description: 'Black handbag.',
          quantity: '1',
          price: '15',
          tax: '0.02',
          sku: 'product34',
          currency: 'USD'
        }],
        shipping_address: {
          recipient_name: 'Brian Robinson',
          line1: '4th Floor',
          line2: 'Unit #34',
          city: 'San Jose',
          country_code: 'US',
          postal_code: '95131',
          phone: '011862212345678',
          state: 'CA'
        }
      }
    }],
    note_to_payer: 'Contact us for any questions on your order.'
  });
},

4. Finally, execute the payment

onAuthorize: function(data, actions)
{
  return actions.payment.execute().then(function()
  {
    // Show a confirmation message to the buyer
    window.alert('Thank you for your purchase!');
  });
}

Integrating an eCommerce payment gateway improves the overall experience and security for the customers. You can conveniently use these steps to seamlessly integrate a secure payment gateway into your website.

Final Thoughts

Payment gateway integration is not that complicated if you have all the right information with you. Integrating the best payment gateways for small businesses will ensure a positive impact as it attracts more customers with enhanced security.

We hope you have enough understanding of which payment gateway to use for your business. If you still need a helping hand or any related details, you can write to us in the comment section.

Ecommerce Trends Ecommerce Trends, a blog regularly updated with trends in the eCommerce & marketing industry. The authors of this blog have decades of experience in their fields. Readers can seek extremely valuable information on Ecommerce Trends & Digital Marketing Strategies.