The spread of global e-commerce businesses is one of the defining aspects of the modern world. The data speaks for itself: in 2023, worldwide e-commerce reached an immense 5.8 trillion U.S. dollars in sales.
That’s why choosing a payment gateway that meets specific business requirements and securely handles sensitive customer data is a top priority for any e-commerce business.
In this article, FYST reviews 6 key factors to keep in mind while choosing a payment gateway for your online business.
What is a payment gateway and how does it work?
Before diving into the topic, let’s understand the payment gateway and how it works.
Payment gateways function like point-of-sale terminals in physical stores (except it happens online). This system is the cornerstone of electronic transaction processing: payment gateways process visitors’ card details once they enter them at your checkout store and make the transaction happen.
Top 6 factors to consider when choosing a payment gateway for your e-commerce business
According to a study, the global market revenue of payment gateways reached 31 billion U.S. dollars in 2023, and it’s expected to get to 161 billion dollars by 2032 (source: Market.us Scoop), so the competition between these payment solutions for businesses available in the market is enormous.
Therefore, choosing the payment gateway that best suits your business mightn’t be that straightforward. That’s why FYST has prepared the top 6 critical factors you need to consider in your payment gateway.
Security measures
Although 59% of customers expressed concern about the risk of online payment in 2022 compared to the previous years (source: Statista), most payment gateway solutions adhere to strict compliance with the Payment Card Industry Data Security Standard (PCI-DSS). Make sure you choose the online payment gateway that comes with features like built-in fraud prevention, encryption, tokenization, and more.
Transaction fee
Most payment gateways charge a fee per transaction, which can increase your business’s cost. Therefore, consider payment solutions for e-commerce businesses with low transaction charges when choosing a payment gateway. Considering your volume of transactions also helps you reduce expenses, as there are online payment gateways that offer pricing based on your transaction volume. As of 2021, most payment gateways charge a monthly fee rather than a gateway setup fee.
Types of payments allowed
Choose a payment gateway that supports your target customer base, including debit and credit cards, digital wallets, and other relevant payment methods. If your e-commerce business targets a worldwide customer base, choose a payment gateway that supports multi-currencies and relevant international payment methods.
Integration with other systems
Consider how easy the payment gateway integrates with your existing software, website, mobile app, and other platforms. Otherwise, it may cause your online shopping platform to become glitchy, leading your customers to leave your website.
Transaction limits
Check for transaction limits while choosing your solution. Some payment gateways have a transaction limit on the amount it can process per month. If your e-commerce business is small, it may not be an issue. Otherwise, be certain that your selected payment gateway has no such transaction limits.
24/7 customer support
Ensure the payment gateway solution provider offers 24/7 customer support through various channels such as chat, mail, phone calls, etc. It’s one of the major concerns when choosing a payment gateway, as customers may panic if technical problems or other issues arise during their payment process.
Wrap up
With the myriad of payment gateway options in the market, choosing the best one for your business can be challenging. Because of many advantages and disadvantages to consider, making an informed decision in this domain isn’t always that straightforward.
Fintech experts like FYST can handle the selection and integration of proven payment solutions for you to simplify and streamline the process and ensure you have the best solution for your needs.
