Top 5 Payment Gateway Integration Best Practices You Must Follow

Payment Gateway Integration Best Practices

During the fiscal year (FY) 2021-2022, the volume of digital payments in India increased by 33% year on year (YoY). According to the Ministry of Electronics and Information Technology (MeitY), 7,422 crore digital payment transactions were captured during the same period, up from 5,554 crore transactions in FY 2020-21.

The rise in online shopping, widespread use of mobile phones, easy internet access, and the Indian government’s Digital India campaign have all helped to popularise online or digital payments.

It is now a business requirement for retailers to offer their customers online payment options. To include digital payment options on your website, you will need a payment gateway – a technology platform that authorises payments.

It links the bank to your online store, allowing you to safely transfer money from your customer’s bank accounts to your business’s bank account online.

Before finalising the technology platform for your online business, you must take note of the payment gateway integration best practices, which we will discuss in this blog.

However, let us first understand –

What is a payment gateway?

A payment gateway facilitates financial transactions by allowing data transfer between a device and a financial institution. Payment gateways are essential for eCommerce ventures – for any item to be purchased and sold online, a payment gateway is required.

These gateways essentially allow businesses to validate customer data. They furthermore support major financial services such as MasterCard and Visa, allowing for simple payment.

Recommended Read: Tips to Find The Best Payment Gateway For E-commerce in India

How does a payment gateway work?

You can easily integrate a payment gateway into your website by opening a merchant account with your local bank and then connecting it to a payment gateway of your preference with the necessary security controls.

Most payment gateway integrations may employ a similar mechanism, which typically involves the following set of authorizations and communication between various facilities:

  • After placing the order, the customer proceeds to the payment stage.
  • The customer enters their credit/debit card information.
  • The payment gateway encrypts all payment information for security reasons.
  • The encrypted information is transmitted to the acquiring bank, which then forwards it to the customer’s card association (such as Visa or MasterCard), which then forwards it to the customer’s bank.
  • The customer’s bank determines whether the customer’s account balance is enough to pay the amount owed.
  • After approving or declining the request, the customer’s bank sends a code to the payment processor to convey the same.
  • The payment processor sends this response to the payment gateway, which then sends it to the website.
  • This response is communicated to you and your customer via the website.
  • If the customer’s payment request is approved, you must authorise your bank to accept the amount through a payment processor.
  • The bank transfers the approved funds to your seller or merchant account linked to your payment gateway.

Though payment processing through a payment gateway appears quite complex and lengthy, the process usually takes a few seconds to complete.

Top 5 payment gateway integration best practices

Choosing the best payment system is a critical step in ensuring the security of your online business. For those who do not already have a basic working knowledge of the payments industry, navigating the world of payment processing can be difficult.

Below, we will understand key payment gateway integration best practices one must consider when developing a payment strategy for your online store.

1. Use a platform-hosted merchant account

Using the payment solution built into or provided by a platform is one of the most secure and easy methods for accepting credit and debit cards with almost any online platform.

Because the feature was specifically created to supplement your eCommerce store by the same company, you can be confident that the integration’s maintenance and updates will be prioritised.

It also enables you to use your eCommerce solution as a one-stop shop for all issues and questions, removing the necessity for triage among your eCommerce support and payments support team.

Best of all, eCommerce platforms value their clients’ businesses, so they usually match or beat competitors’ prices.

Recommended Read: Hosted Payment Gateway: Complete Guide 2022

2. Enable multiple payment methods by utilising all-in-one solutions

Aside from accepting credit and debit card payments, it’s a good idea and even an emerging trend to meet online shoppers halfway by providing several flexible payment options.

E-Wallet payments, BNPL options, mobile digital payment apps, and other online payment methods are becoming increasingly popular, but managing different accounts can be costly.

All-in-one payment solutions are now becoming increasingly popular in this market. By utilising a payment provider that handles the work of integrating a variety of payment methods, you not only make it easier on yourself but also simplify the process of your online store by minimising the number of integrations, which can pose vulnerabilities to hackers.

3. Check that your storefront meets compliance standards

PCI DSS (Payment Card Industry Data Security Standard) is a set of standards designed to ensure the security of global payments.

Many factors contribute to PCI compliance, such as safeguarding stored cardholder data, tracking access to your systems, etc.

Fortunately, most merchant service providers already include PCI compliance as a built-in element of their offerings. So the onus is usually not on business owners to follow the numerous associated rules.

When researching credit and debit card processing solutions, consider options that include PCI compliance in their services.

4. Get an SSL Certificate for your online store

SSL (Secure Socket Layer) Certificates encrypt any transmitted data between your online store and your customers’ devices, providing an additional layer of security.

Have you ever wondered what the distinction is between a URL beginning with http:// and one beginning with https://? The letter “s” denotes the existence of an SSL certificate.

SSL Certificates ensure that your customers’ private details remain safe and out of the reach of hackers while also safeguarding payment information.

Most eCommerce platforms include SSL certificates as part of the cost of online storefront services, but if yours does not, you must get one from a reputable source before accepting payments.

5. Integrate fraud prevention tools

Finally, use all of the fraud prevention tools at your disposal to provide the highest level of security for your payment process. Among the most common fraud tools are:

  • Address Verification Services (AVS): It compares the billing address provided with the one filed with the cardholder’s bank to ensure they match.
  • reCAPTCHA: It ensures that each transaction is initiated by a human and prevents bots from testing stolen card details to see if it works.
  • Fraud Score tools: They assist in identifying suspicious orders without manually inspecting each one for unusual or suspicious characteristics.

Frequently asked questions (FAQs)

Q1. What is a hosted payment gateway?

A hosted payment gateway is an online payment gateway which is hosted on the website of a third-party payment service provider, so that the entire checkout process takes place away from the merchant’s website.

Because the payment process occurs elsewhere and no payment information is stored on your website, you neither have to worry about the PCI-DSS compliance nor about providing technical support.

Q2. What is PCI DSS?

The Payment Card Industry Data Security Standard (PCI DSS) is an information security standard for organisations that handle major card schemes’ branded credit cards.

PCI standards are mandated by the card brands and administered by the Payment Card Industry Security Standards Council.

Q3. What is an SSL certificate?

An SSL certificate is a digital certificate that authenticates the identity of a website and allows for an encrypted connection.

SSL is an abbreviation for Secure Sockets Layer, which is a security protocol that establishes an encrypted connection between a web server and a web browser.

Q4. What is a fraud score?

A fraud score is an informational tool that assists you in determining the risk associated with orders prior to processing by identifying traits and trends.

On a concluding note

It is critical to ensure that your checkout and payment infrastructure is sound from start to finish if you wish to secure your online store for your customers and minimise fraudulent activity. Remember to keep these payment gateway integration best practices in mind when developing your online payment strategy so that you and your customers don’t suffer in the big scheme.

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