Payment gateways: what are they and how to pick the best one?

Online sales are an ever-growing area of total spending, and all businesses should have some form of web presence to capitalise on the increased demand to buy online.

Data published by the BBC showed that online sales accounted for 30% of UK spending in April 2020, and that US non-store retail sales were up 30.8% in the year between May 2019 and May 2020.

Any business that doesn’t have a web presence is missing out on a growing revenue stream. You’ll need some form of payment gateway to enable your customers to pay online. So, what is a payment gateway, and how do you find the right one for your business?

What is a payment gateway?

A payment gateway is simply a technology offered by a payment solutions provider that enables a customer to input their data and send it to your bank. It provides a secure link between your website and your bank that allows them to determine whether the payment is legitimate or likely to be fraudulent, in which case the gateway will decline the transaction so that you avoid a chargeback claim.  

A payment gateway enables customers from around the world to transact with you 24/7.

So, what should we look for when considering which payment gateway is the best solution for our business?

  1. A great online payment experience

An excellent payment gateway provides an enjoyable payment experience for your customers; it’s quick, easy, and accepts a wide variety of payment methods.

If your payment gateway does not deliver this type of experience, your customers will abandon their purchase due to feeling friction, and they may transact with your competitor instead.

  1. Easy integration with your website 

If you already have a website that offers a great online experience for your customers, then you will wait to find a payment gateway that integrates well with your existing technologies.

  1. Mobile integration

Customers are increasingly making their purchases via mobile devices, so be sure to check that the payment gateway works well for mobile transactions.

  1. Integrates with your marketing

We want to make it as easy as possible for customers to transact with our business, so look for a payment gateway that will easily integrate into your marketing approach. For example, look for a system that enables you to copy a ‘pay button’ into your marketing emails and text messages, and one that works with QR codes. 

It’s also a nice trust-building touch if the payment system generates a branded email receipt for your customer so they know their payment has been successful and they have a record of the transaction.

  1. Accepts the payment options your customers use

A payment gateway has the potential to open up the world to be your customer base. Make sure that you select one that accepts all the cards that your customers are likely to use, based on their locations. For example, not all payment gateways accept American Express, but this is a popular credit card for some customer groups.

Choose an ecommerce payment gateway that will enable your busines to grow over time, rather than creating barriers.

  1. Real-time reporting

Things move quickly in the world of eCommerce, so it’s essential to have accurate and up-to-date information on your payments at the click of a button. 

You should be able to access information on any payment declines with an explanation of why they were declined and details of any chargeback claims.

  1. Recurring payments

If your business runs on a subscription basis or has any need to take recurring payments, then you need a payment gateway that offers tokenisation; a secure way of processing ongoing payments from your customers.

  1. Outstanding fraud protection

Finding a payment gateway with the right level of fraud protection is critical for your reputation. A payment solution provider that rejects too many or too few transactions will cause you to lose revenue.

Instead, find a provider with a sophisticated level of fraud protection. For example, payments experts UTP Group have the backing of an established bank that has advanced fraud detection systems. Additionally, UTP Group conducts an extra level of daily fraud checking for their customers that is unique in the industry.

  1. Look at the data security credentials

Look for a provider that offers the top level of data security to protect your customer data and your reputation. To find out their level of data security, look for the payment solution provider’s PCI Compliance level; meaning how far they comply with the Payment Card Industry standards. For your peace of mind choose a provider that offers the top level of compliance; PCI Level 1 compliance.

  1. Faster card processing

Once you’ve taken a payment from a customer and they have their product or service, it’s frustrating to wait around for the money to hit your bank account. Delays can hurt your cash flow.

Instead, look for a payment solution provider who will pay you fast through same day funding. For example, UTP Group will get your money to you as quickly as within an hour, rather than the standard three to four days that you experience with other providers.

  1. Easy application process

Some payment solutions providers insist on multiple in-person meetings to assess your needs, which can be fairly time-consuming. 

Consider a provider that offers a fast and efficient online application process, with a pricing calculator so that you can quickly get a sense of the costs and be in a position to launch or upgrade your online payment process.

Conclusion: find a payment gateway that will enable your business to grow

A payment gateway is a must for any business that can have an online presence. It can open up entirely new customer groups and revenue streams, and significantly reduce your operational costs.

The number of payment gateways on the market can make selecting one quite a daunting task, so use the checklist in this article to help you to find one that meets your needs today, and one that will support the growth of your business in the future.

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