What is an online payment gateway?

Product Information 1 December 2017

What is an online payment gateway?

An online payment gateway, is a secure webpage that acts like a card machine and works to transfer sensitive financial information between your website, the customer’s bank account, and your merchant account. It lets you process card payments through your website or take payments over the phone and handle them through a virtual terminal.

Having a payment gateway is key for an eCommerce offering as it allows your customers to shop safely and confidently on your site. It can also help you open up your services to customers who want to pay by phone.

Learn everything you need to know about a payment gateway and how you can implement one for your business.

How does the payment gateway work?

Having an online payment gateway allows eCommerce websites to authorise transactions between sellers, buyers, and their corresponding banks. It also gives you a way to take payments over the phone; you enter customer details into a virtual terminal and they’re processed through the payment gateway.

This is how the payment gateway works:

  1. If they’re paying online, the customer clicks through to the online checkout, enters their card details, and submits them. If paying by phone, the merchant enters the customer’s details through the virtual terminal before submitting them.
  2. If paying online, the customer’s data is sent to the merchant’s website.
  3. The customer’s information is then sent to the payment gateway service provider (e.g. to Paymentsense) for them to carry out security checks.
  4. Once the transaction has passed the checks, the transaction is sent to the relevant card association connected to the customer’s card (e.g. Visa or Mastercard) to check the customer has sufficient funds.
  5. The card association sends its response to the payment gateway.
  6. The payment gateway sends this information back to the merchant’s site, to approve or deny the transaction, based on the response from the card association.
  7. If the payment is approved, the customer will receive confirmation and the payment gateway will send the money to the seller’s merchant account.

It might sound long winded but it only takes a few seconds.

This entire process is encrypted, to keep both the buyer and seller’s details safe as the transaction is processed through the various channels. Payment gateways also have screening measures in place to protect merchants against fraudulent transactions, and many are compatible with 3D secure authentication, for added protection and peace of mind.

What are the benefits of using a payment gateway?

Having a payment gateway allows you to expand your business offering, so you can extend your services to customers who want to shop online or pay by phone. While services vary depending on the provider, some of the benefits of a Paymentsense payment gateway include:

  • Quick and efficient transactions: it’s an efficient and easy way to process online and phone payments, with minimal effort required from both you and the buyer.
  • Integrate with your online shopping cart: plug-ins allow you to easily link your shopping cart to your payment gateway.
  • Safe and secure: it offers a secure and reliable payment solution that your customers can trust, building up confidence in your brand.
  • Easy to set up: integrating a payment gateway is a fast and straightforward process, so you can start selling online or by phone quickly.

How to set up your payment gateway

With Paymentsense, you can set up a payment gateway for your website in just 24 hours. You’ll need to start by applying for a merchant account.

If you want to process transactions through your website, email or link:

Once you’ve been approved and your merchant account is set up, you’ll receive a simple set of instructions that outline how your developer should integrate the payment gateway with your website. And if you run into any issues, our 24/7 support staff are available to help with any questions.

If you want to process transactions by phone:

Once your merchant account has been approved and set up, we’ll send you a set of straightforward instructions. Within a few minutes, you should be able to start taking phone payments by entering customer details into your computer, laptop, tablet, or mobile.

A payment gateway allows you to reach a whole new set of customers and add a new layer of safe, efficient, and modern service to your business. Get a free online quote or speak to our experts for more information.

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