eCommerce web development: How Does a Payment Gateway Work?

You may have heard that integrating the Payment Gateway to an ecommerce website is a very important development step. Payment Gateway is run by software and it allows the customers to make payments through bank cards online. Shopping carts and payment gateway are two things an ecommerce store can’t do without. Other features of the Payment Gateway include:

·         Encrypting private data as well as data related to the payment process.

·         Carrying out a string of communication between the banks, customers and your business.

·         Authorizes payments.

·         Some Payment Gateways also have option to calculate handling cost, sales tax and shipping rates.

·         Advanced Payment Gateways also have fraud detection tools.

As you can see the Payment Gateways are filled with features that are quintessential for the smooth running of an ecommerce website. Payment Gateway integration is held as an important stage in ecommerce website development. Popular software such as PayPal and Google Direct may be used, or you may opt for personalized Payment Gateway software. As any ecommerce website developer would suggest: it is important for you to learn just how a Payment Gateway works. So, below working of the Payment Gateway is explained in a step by step process: 

·         Process initiates when a customer buys products from website through phone or online order.

·         There is a SSL (Secure Socket Layer) used to scramble all the information put in by the customer.

·         The information put in by the customer is kept safe with the website administrators.

·         This request is sent to the bank.

·         The request is next forwarded to the card association such as American Express, MasterCard, etc.

·         The card association then forwards the particular transaction information to the concerned bank.

·         Bank checks whether the person has sufficient balance in his/her account.

·         There is an authorization code sent by the bank to the card association.

·         This code is then sent to the business through the Payment Gateway. The money is funded to the company’s bank account.

All these set of complicated steps are integrated by software named Payment Gateway. It is no wonder then that in ecommerce website development implementation of Payment Gateway takes a significant while.