How do online payment gateways work?

An online payment gateway links a commercial/transactional portal or website and usually a bank. This process begins when the cardholder enters their data after making a purchase on the website. The information is then encrypted on the cardholder’s web browser side and sent securely to the merchant’s website. In this stage, the encrypted information is forwarded from the merchant’s server to the payment gateway in secure socket layer encryption, which connects to the processor used by the merchant to reacquire. The processor sends the transaction information to the credit card exchange, which then routes it to the issuing bank.

The reverse process also happens in seconds, and along with the response from the issuing bank, a few other details are sent to the cardholder, such as: a notification code, the status of the transaction, and the reasons why the transaction failed. have effect. In other words, this information goes through the credit card exchange, the acquiring processor, the payment gateway, the merchant’s website, and finally reaches the cardholder.

In addition to the above steps, the rest of the transaction occurs in a different time frame and involves product delivery and money transfers from the acquiring bank to the merchant’s designated account.

Other options that merchants can take advantage of outside of online payment gateways include: authorizing transactions, making refunds, and capturing payments by accessing reports and real-time tools configured for these purposes. Online payment gateways sometimes also allow merchants to easily work with different currencies and card types.