Any business that aspires to operate in the online space is fairly aware of a payment gateway and its significance. In today’s customer-centric marketplace, it is almost impossible to offer a good checkout experience without a reliable payment gateway.
India’s payment gateway market is expected to grow from US$ 446.9 million in 2017 to US$ 1,708.1 million in 2025 at a CAGR of 19.3% between 2018 and 2025.
Buyers have been increasingly switching to digital payments due to their quick access and ease of use. Consequently, merchants are focusing on ensuring hassle-free transactions with the help of a payment gateway.
Regardless of the industry or trade, a payment gateway integration has become an integral part of the business process. However, there is a sense of obscurity when it comes to understanding its importance and advantages. Add to that the incorrect content on the internet, and switching to a payment gateway can seem like a nonessential task.
This article debunks all the myths associated with a payment gateway and throws light on its many benefits. Let’s begin with the basics.
What is a payment gateway
A payment gateway is a tool to enable transactions on a website or app. Its primary purpose is to help businesses transact seamlessly while accepting payments from their customers.
An online payment might happen within seconds but it involves communication between multiple systems. There are banks (issuing and acquiring), credit/debit card, payment processor, website/app and so on. A reliable payment gateway ensures that this communication between the entities is quick and smooth so that the payment is successfully processed.
It is hence responsible for ensuring that the amount debited from the customer’s account reaches the merchant in a secure way. Most payment gateways support several payment modes such as credit/debit card, net banking, UPI, and digital wallets.
Payment gateway misconceptions
If you are convinced that a payment gateway is not for your business, it is likely because of the following reasons. Here’s why none of them make rational sense.
Payment gateways can access your data
Several users and even merchants tend to believe that a payment gateway has access to the sensitive data of the buyer. Many worry that private information and card details of their customers are prone to exposure.
Payment gateways are definitely responsible for handling sensitive data. However, there are guidelines laid down by RBI to prevent its breaches and theft. A reputable payment gateway has a strong fraud and risk prevention framework in place.
Additionally, a payment gateway is supposed to be PCI DSS compliant, which indicates that it follows best security practices, protects your data and is capable of preventing any loss of financial information.
Paytm Payment Gateway is PCI DSS Level 1 compliant and also offers complete benefits to its merchants through e-commerce hosted platforms such as Shopify, Zoho and Zepo.
Every payment gateway has the same offering
The objective of all the payment gateways might be the same but their offerings and processes can be very different. It is these additional features and benefits that can make a huge difference for a merchant.
For instance, not all payment gateways offer multi-currency payments or international transactions. If your business aims to expand for a global reach, it is essential to check this feature.
Another highly important factor for a business of any size is to thoroughly check the settlement period offered by the payment gateway. A quick settlement is extremely important for a steady cash flow. Many offer a T+2 settlement but it is invariably delayed half of the time dues to bank holidays and weekends.
With Paytm Payment Gateway’s T+1 settlement, payments are credited to the merchant’s account the very next day, all throughout the year.
Payment gateways are for bigger businesses
Certainly not. Payment gateways are for businesses that want to offer a great checkout experience. And which online business in today’s day can afford to skip that?
Even if you have just started out, it is vital to focus on the growth curve and eliminate all the hassles of manual work, additional resources and bad experiences. A payment gateway not just facilitates transactions but also streamlines and automates a lot of processes related to payments.
Moreover, it offers a collated data of your sales with insights and analysis that are helpful for startups and small businesses to drive their business decisions.
Paytm payment gateway’s merchant dashboard has features such as transaction monitoring, refund management and analytics that make business operations smoother.
Payment gateways have hidden charges
This is more likely a miscommunication than a misconception. When a payment gateway claims that it is free, it usually refers to setup or annual maintenance fees. Most of them don’t charge either.
However, you are charged an Merchant Discount Rate (MDR) which is a small percentage of the particular transaction value. This fee helps the payment gateway maintain a safe and seamless checkout experience. A few of them also customise the pricing plan based on the business requirement, its scale and size.
Paytm Payment Gateway does not charge a MDR on UPI transactions helping merchants save upto INR 97,700 every month (assuming monthly sales volume of INR 1 cr).
Payment gateways demand a lengthy integration process
On the contrary, your payment page can be activated within minutes. Payment gateways offer developer-friendly integrations with minimum coding requirements. Their software developer kits (SDK) also document the process for easy onboarding.
Additionally the API’s and ready to use javascript snippets help in customising the checkout flow across various platforms. Merchants should also verify if the payment gateway offers a plugin for their preferred e-commerce platform.
Paytm Payment Gateway’s complete online onboarding and minimum documentation lets businesses start accepting payments with ease.
Conclusion
Most tech solutions have conflicting opinions around them. But it’s essential to dive deep and understand their benefit for your business. When it comes to choosing a payment gateway, it should not just fit your business requirements but efficiently clear any doubts and misconceptions that a merchant may have.
There is one last and a rather unsubstantiated misconception – that Paytm does not offer a payment gateway! Need we say more?
