HOW PAYMENT GATEWAY KEEPS INFORMATION SECURE AND ITS BENEFITS

How a payment gateway keeps information secure and its benefits?

Online payments have become a part of our daily lives in no time. We are doing online transactions not only through debit or credit card but also through various other mediums like UPI, NetBanking, and Wallet. And why not? Online payments are fast and convenient. They allow you to buy products and services around the world.


If you are a seller, you can sell goods to anyone in the world with an internet connection. Your customer does not even have to have a computer; A smartphone is enough.


Paying online is a fundamental feature that every e-commerce platform in the world offers. And they can provide this facility by integrating with the payment gateway.


But what exactly is a payment gateway? Is it safe to transact through a payment gateway? Does your business require payment gateway integration? Let us know-


PAYMENT GATEWAY

What is a Payment Gateway?


Online Payment Gateway (PG) is a service that connects your bank account to the platform where you need to transfer your money. PG is software that authorizes you to conduct online transactions through various payment modes like net banking, credit card, debit card, UPI, or many online wallets available these days. PG plays the role of a third party that transfers your money securely from a bank account to the merchant's payment portal.


To illustrate this in simple terms, when you buy a book from a popular digital platform like Flipkart when you pay for the book, a payment gateway helps you in the process by transferring your money to Flipkart.


HOW A PAYMENT GATEWAY WORKS


A payment gateway focuses on securing sensitive information given by the user throughout the process. This ensures security by encrypting user-provided data such as cards and bank details.


The following are the basic steps that show how a specific payment gateway works.


Step 1: First the customer places his order and then presses the submit or checkout button on the website


Step 2: Once this happens, the website or e-commerce platform takes the customer to the payment gateway, where it gives all the information about the bank or the card they are using to make the payment. The PG then takes the user directly to the issuing bank's page or a 3D secure page and asks them to authorize the transaction.


Step 3: As soon as the payment gateway is approved for the transaction, the bank checks whether the customer has a sufficient amount in the account to make this transaction successful.


Step 4: The payment gateway sends the message to the merchant accordingly. If the answer from the bank is "No", the merchant later sends an error message to the customer, informing them of the problem with the card or bank account. If the response from the bank portal is "yes", the merchant wants a transaction from the bank.


Step 5: The bank settles the money with the payment gateway, who in turn settles the money with the merchant


Once this process is completed, the customer gets a confirmation message to place the order.


As mentioned earlier, money transactions involve sensitive information about a person's bank and card details that are completely personal to him. Therefore, it is necessary to ensure that this information is protected.


How a payment gateway keeps information secure


The payment gateway ensures the security of the information you enter. Here is a list of things that a PG does to protect your data:


  • First of all, the entire transaction is done through an HTTPS web address. This is different from HTTP because S in HTTPS is for Secure. The transaction takes place through
  • As a result of the hash function, the system often uses a signed request from the merchant to validate the transaction request. This signed request is a secret word that only merchants and payment gateways know.
  • To secure the payment page result of the process, the IP of the requesting server is verified to detect any malicious activity.
  • Virtual Payer Authentication (VPA) is something that acquirers, issuers, and payment gateways are supporting to make the process more secure. The VPA, implemented under a 3-D secure protocol, adds an extra layer of security and helps online buyers and sellers easily authenticate each other.

Benefits of using a payment gateway


The payment gateway is not just used for transferring money, but also has other benefits. The payment gateway can allow the merchant to provide a better user experience.


  • PCI-DSS Wallet - PCI-DSS compliant provides security for the user to store or pay for their personal data in portals and gateways. For example, if you are a frequent customer of Swiggy, you can save your bank or card details on their site or app, and the gateway will protect it from any cybersecurity threat.
  • White-Label Wallet - Some payment gateways allow you to conduct digital transactions through a mobile wallet app. This is the current trend, as it enables the user to perform all his transactions by sitting in one place only. You can bring your money from your account balance to the mobile wallet app and then you can use it to pay on another app or website.
  • Fraud screening tool - Many payment gateways provide fraud screening tools to reduce the risk of you losing information. These tools include Card Code Value (CCV), Card Verification Value (CVV), or even Address Verification Service (AVS). These tools ensure that there are no fraudulent transactions.

The payment gateway focuses on creating a secure route to facilitate the payment between a customer and merchant securely. This includes authentication of both parties from the banks involved. The most important benefit of Payment Gateway is that it allows millions of users to use it at the same time, allowing you to buy or sell goods and services whenever you want.


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