What is a Payment Gateway?
|Date Added: June 09, 2011 07:12:55 PM|
A payment gateway is the Internet’s version of the credit card terminals people use at brick and mortar retail stores. In order to accept payment by credit card, Internet businesses use the payment gateway services. Payment gateway services make it possible for Internet business owners to accept payment by credit card as well as by electronic check.
With payment gateway services, customers have the ability to pay for their purchases with three types of cards: credit cards, debit cards and gift cards. Payment gateway services also make accepting payment by way of electronic check much more convenient than the paper kind. The electronic check can be accepted at the moment of purchase, rather than having to wait for the check to arrive in the mail, and then have to wait for the check the clear at the bank. Since more people have checks than have credit cards, being able to accept checks will raise a business’s revenue.
Gateway services make receiving payment electronically much faster than it could be done without these services. As card payments and electronic checks are quickly processed, the money that business owners are owed also makes it into the business’s account quickly within two days. All of these transactions are done over the Internet in a safe and secure manner.
In order to take advantage of gateway services, Internet businesses have a merchant account with a financial institution. Payment gateway services make this easy by setting up the account for their clients. After a merchant account has been set up, the business owner can decide how they want to accept payments. One way is to utilize the payment pages that payment gateway services maintain on their websites.
Business owners can create their own payment pages, but payment gateway services can also make these pages for their clients. These pages can be created to be an extension of the business, with the logo and the coloring of the business owner’s website added to them. The convenience of this is that the payment pages will go even further in branding the business for the business owner. These payment pages have a highly professional look that sets people at ease when they begin to enter their credit card information.
Receiving payment from payment gateway services makes a few steps in the process of collecting payment unnecessary. Those businesses that cannot accept payments by way of a payment gateway have to wait an average of 43 days to receive their money. Businesses that can receive their payments over the Internet electronically will receive their money, on average, within two days. It takes the software two minutes to receive the business’s order, 10 seconds to process the payment and two days for the money to show up in the business’s bank account.
One way to accept payments online is to invest in payment gateway services that offer a virtual terminal. The virtual terminal is like the terminal described above in the grocery store, and businesses will be able to access the software with their payment gateway services accounts. It can be used wherever the business would like to accept payment, 24 hours a day, seven days a week, as long as the business owner has the capability to go online.
Businesses that have a virtual terminal have an account that they must log into when they are ready to accept a payment. From there, they enter the credit card information and the transaction can be accepted. The money is placed into the business’s account electronically and automatically. It makes accepting payments from places like the local coffee shop very easy, providing the business owner can go online. Internet business owners are not forced to only conduct business in an office with a virtual terminal.