Trade has gone global, and people are loving to shop and pay online. Accepting payments online has, in fact, become the foundation stone to succeed for the merchants. Almost every e-commerce merchant in the present scenario is integrating a payment gateway to their mobile app so as to uplift its online store. If you are also planning for the same, it is imperative for you to know the basics of the payment gateway process, which we will be discussing in this blog.
PAYMENT GATEWAY, AN INTEGRAL PART OF THE E-COMMERCE BUSINESS
A payment gateway is a service that allows processing of credit card payments for online as well as conventional brick and mortar stores. In layman’s language, it is a process that facilitates a quick and seamless shopping experience for the users, which is the need of the hour.
As you can see in the above statistic, there are more than 218 million users registered on online payment platform PayPal in the third quarter of 2017. Besides this, 34% of North American retailers started accepting PayPal as their payment method by December 2016 and 21% are planning to integrate it in the next 12 months.
All these numbers signify that all the startups and established businesses need to integrate a payment gateway in their application so as to satisfy and engage their target audience. Now as you know what a payment gateway is and what is its current scenario, let’s move to the working mechanism.
WORKING OF THE PAYMENT GATEWAY
When a customer visits an e-commerce mobile app and adds the selected products to the cart, the cart gets linked with a payment gateway like PayPal, Stripe, Amazon Payments, WorldPay, etc. The customer is asked to enter the bank card details in the mobile app form which is then directed to the payment gateway. The gateway encrypts the data and sends it to the bank associated with the card. The banking service then validates the request with the help of a payment system (MasterCard or Visa), which eventually analyzes the solvency of the user and compares it with the cost of purchase. On approval, the bank issuer sends the authorization code to the seller. At the end, the required amount is debited from the customer’s card and transferred to that of the seller’s in a defined time period.
THINGS TO CONSIDER FOR PAYMENT GATEWAY INTEGRATION IN A MOBILE APP
Here’s a list of requisites for effectively adding a payment gateway feature in your app:
Seller account type
A merchant or seller account refers to the online account that holds the payment for a while until it is being processed by the payment gateway. Currently, there are two types of merchant (seller) accounts: Dedicated and Aggregated.
Provided by payment gateway solutions like PayLeap and Authorize.Net, dedicated accounts provide you more control over funds and operations (such as changing the speed of money transfer process, adjusting the customer needs, etc). However, the mobile payment platforms deduct a processing fee for every transaction and ask for long investments, submission of exhausted data, etc. Because of these issues, some sellers prefer opting for an Aggregate account which keeps your possession along with other merchant’s funds. Providers like PayPal, Stripe and Braintree ask for less personal information and offer faster and safer access to your account.
Payment gateway provider
As you can see in the image above, there are multiple payment gateway providers in the market. However, the payment gateway providers we recommend to use in 2017-2018 are:
PayPal is a leading payment integration method and supports 26 currencies and has customers in 203 countries. It offers exclusive services like performing a transaction with bitcoins, splitting the payment, creating an invoice, paying multiple people at the same time, hosting your own checkout page, and so on. For a mobile app developer, PayPal integration is the ideal option for streamlining the mobile payment procedure.
You can also consider Braintree a subsidiary of PayPal for enjoying incredible online payment solutions. This mobile payment API offers features such as direct integration with PayPal, advanced attack protection, compatibility with 7 programming languages, 24/7 technical support, support for 130 currencies, and processing credit card as well as Bitcoin. The most important thing about using Braintree is that it charges no service free until your trading account reaches $50,000. Once the limit exceeds, you are charged a transaction fee of 2.9% and fixed monthly charges.
Stripe is a developer-friendly mobile payment gateway with a support for a vast range of programming languages, including Java, Ruby and PHP. It accepts payments in nearly 140 currencies and allows easy subscriptions, card storage and direct payments to a bank account. In addition to this, it processes bitcoins and allows the developers to either use the pre-built form or make a custom one.
Application security certificates
Mobile app developers looking forward to provide online payment solutions should choose the most trusted mobile payment gateways (like PayPal or Braintree), but you still need to ensure that this whole process is done considering the PCI DSS (Payment Card Industry Data Security Standard) compliance. This is because the PCI compliance covers a set of security standards developed to protect card information during and after a transaction takes place.
If any information of a cardholder is stolen, the merchant not using PCI compliant has to pay a fine of $500,00 per incident. You can prevent this situation by including PCI compliance into the payment integration process. For that, the merchant needs to satisfy following requirements:
All the mobile payment gateway providers offer SDKs comprising mobile platform libraries. These libraries enable easier supporting and maintaining of the resulting software as well as reduce the risk of PCI. Thus, SDK integration makes the tasks easier for the mobile app developers.
At the end, we want to say that payment gateway integration in a mobile application is one of the most crucial steps to be taken in the present scenario. And its demand will rise in the year 2018. It has been surveyed that the number of in-store mobile payment users in U.S is estimated to be around 150 million by the end of 2020, which signifies nearly 56% of users at that time. So, look forward to it. Follow the aforementioned steps, and incorporate a payment gateway to your mobile app and drive sales.
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