Payment Gateways Software

A payment gateways software is a program that acts as a crossing point between a seller’s website and a customer’s bank and basically helps process the credit or debit card transactions. Due to this ever increasing cybercrime, online businesses are now required to process payments in a protected and dependable way. Best payment gateway software generally operates in the background to enable and approve credit and debit card and other transactions. It safely sends and receives data between the e-tailing site and credit card network to enable quick handling of e-commerce transactions. Websites that desire to receive credit card payments online or through a mobile device are required to install a payment gateway. It links the product sales and the consumer to help users get paid for the transaction.

Best Payment Gateways Software in 2021

1. PayPal
2. Apple Pay
3. Payoneer
4. Skrill
5. Razorpay
6. Paytm Business
7. Mobikwik
8. Bolt
9. Neteller
10. WePay

Market Overview

Best payment gateways software incorporate with many other e-commerce software, which includes apps for subscription management and payment processing software for regular billing, and enable sellers to accept credit cards or other forms of digital transaction payments.

In 2019, the Payment Gateway software market size was estimated at USD 17.3 billion and is projected to hit USD 42.5 billion by 2025, at a CAGR of 16.4 per cent over the 2020-2025 forecast timeframe. Payment gateway software integration has become one of the most important facets of any enterprise in any market. It makes the raising of money into the chosen bank of consumers without infringing on confidential details.

Payment gateway software is an application that transfers all information relating to the electronic purchase, as well as bank feedback or details such as payment is approved or refused to customers to individual banks. The payment portal between financial institutions and numerous e-commerce websites is commonly regarded as an intermediary. This payment gateway is able to validate online payments by encoding sensitive information. Best payment gateways software also provides some protection through offering address verification and card verification systems.

The payment gateway software market can be segmented on a regional basis into North America, South America, Europe, the Middle East & Africa and Asia Pacific. Asia Pacific is anticipated to see the highest growth in countries such as India, thanks to many government's digital technology measures.  Furthermore, China and India are likely to experience outstanding growth over the forecast period due to the increment in the amount of small and medium-sized enterprises and online payment customers.

The industry is segmented into small & medium-sized businesses (SMEs) and major companies depending on the basis of scale of the company. Large enterprises retain the major share, but in the forecast period SMEs are likely to grow at a rapid pace. Payment gateway software serves growing end-users including travel & hospitality, shopping, healthcare, education, finance, services and others. Retail segment has obtained the leading share and is anticipated to see noticeable growth over the coming years.

Market Dynamics

Drivers

• The recent increase in digitalization and rising adoption of different digital payment methods, such as debit or credit cards, mobile payments and online banking.
• The advent of apps that operate on various devices to enable payments online

Restraints

• Risk of losing sensitive data is a major factor expected to hamper the growth of the global payment gateway market
• The risk associated with hackers is another factor projected to hamper the growth of the global payment gateway market.

Challenges

• Internet infrastructure varies in different countries and affects an online software’s accuracy and efficiency

Opportunities

• The merger of different e-commerce sites and interesting discounts provided on online payments and the cooperation of banks with online retailers
• Increasing digitization adoption by different businesses

The competitive leadership mapping showcased provides information for best payment gateways software. Vendor evaluations are based on two broad categories: product offering and business strategy. Each category carries various criteria, based on which vendors have been evaluated. The evaluation criteria considered under product offerings include the breadth of offering, delivery (based on industries that the vendors cater to, deployment models and subscriptions), features/functionality, delivery, product quality and reliability, and product differentiation. The evaluation criteria considered under business strategy include geographic footprint (on the basis of geographic presence), channel strategy and fit, vision alignment, and effectiveness of growth (on the basis of innovations, partnerships, collaborations, and acquisitions).

They have a strong portfolio of Payment Gateways Software and associated services. These vendors have been marking their presence in the best payment gateways software market by offering highly customized and easily deployable software for their commercial clients, coupled with their robust business strategy to achieve continued growth in the market. PayPal, Apple Pay, eWay, Payoneer and Citrus have been identified as Visionary Leaders in the best payment gateways software market.

They have an innovative portfolio of best Payment Gateways Software and have an extensive network of channel partners and resellers to increase the deployment of their services across various vertical markets. Over the years, the Dynamic vendors have been consistently generating positive revenue growth in the best payment gateways software and their market position is enhanced by organic and inorganic strategies undertaken by them over the period. TSYS, Jupiter, Wirecard, Innoviti, Handle, Lydia, Ingenico ePayments, Bolt and Judo have been identified as Dynamic Differentiators in the best payment gateways software market.

They have an innovative portfolio of Payment Gateways Software and strong potential to build strong business strategies for their business growth to be at par with the Vanguards. These vendors have been providing server rack offerings as per their customer demands. Innovators have been forefront in deploying their solutions for niche and custom requests by their clients requiring the processing of high-performance workloads. Paytm Business, Razorpay, Adyen, Simpl, Airpay, Paykun, Mobikwik, Pinelabs and Skrill have been identified as Innovators in the best payments gateway software market.

The emerging players are specialized in offering highly niche and tailor-made solutions and services to their clients. A majority of the emerging vendors have been undertaking multiple acquisitions and boosting their sales capabilities in various regions to offer their integrated services to a wide range of clients. GetSimpl, Worldpay, Atom Technologies, NETELLER, WePay, Arcus, and Boku have been identified as Emerging Companies in the best payments gateway software market.

Why use Payment Gateways Software?

The primary problem with e-commerce retailers is that how do they collect money from the customers. This is the biggest problem solved by payment gateway software. Many companies are acquainted with the complexities and costs of designing personalized payment systems for obtaining and storing credit card data. Best payment gateways software addresses those problems at reasonably low cost and simple configuration. In addition, certain gateway payment solutions enable consumers to insert their own logos into the gateway. It guarantees the users are not diverted to a page by a third party.

Additionally, the capacity to track, recognise and respond to fraudulent behaviour is an essential aspect of the payment gateway program. Best payment gateways software help ensure the security and encryption of sensitive information about their customers and adherence with Payment Card Industry (PCI) regulations for their e-commerce business.

Payment gateway functionality also allows customers to fix any remaining errors and full refunds depending on the purchase details records for the company. A consumer activity log is vital to keeping customers aware of invoices, audits and cash flow, providing e-commerce companies with forecasting. In contrast to the database, some payment systems do provide transaction data insights, improving company forecasting and making things better like customer information and the capabilities of the e-commerce business to upsell or cross-sell accurately.

Reducing fraud 

Best payment gateways software provides encryption of transfers to guarantee the confidentiality of the payer's details and to validate transfers to prevent fraud. Unapproved payments will lead to the notification, which will allow customers to refuse the payment before it passes through. Fraud security filters may involve high-risk nations, email service provider danger, high-risk BIN, account number size, high product code, shipment/bill payment fault, AVS failure, CSC failure, and many others.

Accepting payment in different ways

Users may set up when necessary continuous payments, subscriptions, separated payments and one-time payments. People can also make payments peer-to-peer as required. This flexibility enables people to understand their payment structure to their business model or client requirements.

Scalability 

As a company expands the payment requirements always rise. Payment gateway platform makes it possible to scale by making improvements and integration with numerous e-commerce stores, as required.

What are the various types of Payment Gateway Software?

Best payment gateways software mostly come in two different varieties: host and combined. Hosted payment gateways are simple to set up, and the founder of an e-commerce store needs no maintenance.

Hosted gateways for transaction

Such gateways take a buyer off the checkout page of the website. When a customer taps on site's 'pay now' button they will be redirected to the payment service provider tab. The customer will fill out their payment information here. They will be routed back to the website after the purchase, to conclude the purchase process.

Pro/self-hosted payment gateways

In this type, the customer is asked to fill payment details on the product website. Then these details are to be uploaded on the payment gateway service provider, after receiving the information. Some gateways need the information in a particular format while others require a hash key or a special authentication key.

Payment gateways API/non-hosted

This gateway enables consumers to insert their details directly on the seller's checkout site and execute purchases via their APIs or authentication queries.

Local Banks Integration

These are closely related to the gateways for hosting payments. The customer is routed to the page of the payment portal, where they will fill in the specifics of the purchase and communication. We are routed back to the e-commerce platform after making the purchase, and receipt data are often forwarded with redirection.

Platform-based online payment systems

This type offers e-commerce retailers a platform for direct selling of goods from their databases. Sellers need to generate subscriptions or product lines in the portal they provide, and customers are rerouted to this platform via the checkout button.

Who Uses Payment Gateway Software?

E-commerce companies of all sizes rely on extremely simple-to-use best payment gateways software to direct a website user effortlessly from browsing through to purchase. Businesses turn to payment gateway applications to simplify payment transfers to ensure that transfers are safe and secured. In addition, gateways for payment connect with e-commerce sites and devices such as the applications for subscription management.

E-commerce companies 

E-commerce sites are both the most important and frequent use of gateways for payment. Such firms need a way to receive electronic purchases in a manner that's easy for themselves and their clients. Transactions are simultaneous for all parties through best payment gateways software and are secured.

Charitable organizations and non-profits 

The freedom to make contributions virtually immediately is particularly valuable for charities and other non-profits that are subjected under stringent levels of transparency and taxes. Funders are often more inclined to contribute to an organization or non-profit organization from a non-regulatory point of view, whether it is fast and easy to do so.

Individual clients 

Peer-to-peer online payment apps make it simple for independent users to make quick, easy payments to their friends, family and individual entrepreneurs. Using a mobile phone, anyone can quickly and efficiently make payments to another recipient of the same device. Users don't have to hound the friends for pizza money; you can only submit a request or a one-time invoice with the exact sum that they owe you.

Benefits of Payment Gateway Software

In addition to the general advantages of data transmission, the online payment gateway system can also offer many other advantages. Such as:

Digital terminal: A computer terminal is essentially a virtual version of the actual terminal in a brick-and-mortar shop. Otherwise, shoppers would not be able to enter their credit card information and purchase items without this functionality. Virtual terminals for portable devices, including both tablets and phones, can also be set up apart from computer web pages. In a real environment, too, a virtual terminal may be used by connecting a tiny credit card reader to a device via a USB cable.

Encoding and tokenization: As cybersecurity has become a more challenging problem to fix, software products for the payment gateway offer the opportunity to encode and tokenize financial information. These processes make the system more reliable, and it cannot be misused in case confidential information falls into the wrong hands.

Storing payment details: A good service e-commerce sites can give their loyal customers is the capacity to retain payment details so they don't have to re-enter their information whenever they make some other transaction. Buyers can store multiple cards at a specific website with payment gateway software, and choose one for buying. Also, it can save different addresses. These sensitive details are encoded individually from the e-commerce site and stored there.

QuickBooks: QuickBooks is compliant with best payment gateways software nowadays. This helps online companies to share data to the accounting system swiftly, a process that would take a very long time with outdated technology.

Customization: Software for the payment gateway generally provides multiple application program interfaces (APIs). These additional packages of software can help you personalize a specific platform to pay.

International payments: Many financial companies through their best payment gateways software can have multi-currency and also multi-lingual capabilities. However, additional fees could be imposed for this functionality.

Customer support: Normally e-commerce payment systems come with appropriate customer support. Before selecting a global payment software system, do check and ensure that the company has a history of safeguarding its product and services and serving their customers.

Multiple payment forms: A payment gateway application will generally accept several payment forms. That includes the Passport, MasterCard, Explore and American Express. They may also include less common payment forms such as PayPal, or JCB.

Payment Gateway Software Features

Best payment gateways software mainly offer online payment services that enable consumers to submit and receive credit card payments directly from a bank account, as well as electronic payments. With the range of usable payment methods, as well as the various forms in which payments may be arranged, electronic payment platforms may deliver a broad variety. Payment gateways, though, have a number of apps that help enterprises operate efficiently both on- and offline.

Reporting - Data should be the closest friend of every corporate, and best payment gateways software offer critical information about every payment that is made through the channel. This can make tracking of how and where money enters and leaves the business easier, assisting to accurately assess future performances. This also gives an extra safety feature of the accessibility of where data is spent and whether it was an authorized transfer. This statistics can also provide a critical statistical profile for companies to be more conscious of who their client base is and where.

Manual payment entry - Manual payment entry allows the company to take down transaction data supplied over the phone or in-person and place it in the payment service, creating a greater degree of flexibility. This can also help companies to facilitate the returns or refunds that are requested over the phone.

Adherence with PCI - Payment Card Industry (PCI) rules guarantee electronic payment card customers protection by implementing specific safety criteria. These include safeguarding account holder data, maintaining a risk management program, enforcing strong access control initiatives, tracking and running tests networks on a regular basis, and sustaining a security architecture for data. Fortunately, this has already been included in most payment gateways, making it easy for the users.

Fraud protection - Fraud can be a big issue when trading online, and there are already protections in place for best payment gateways software to defend their customers. Several payment gateways use a wide range of risk mitigation tools, ensuring all users have 360-degree protection.

Two-factor authorization - Two-factor authentication is a method that allows people to extremely-secure their account. After the user has signed into the system using web-based platform, the system will either send an email or a text message to the user just to ensure that they are the owner of the account.  Users can avoid unauthorized access to the system in this way.

Internationalization - International assistance may come in the form of foreign exchange and language support. Businesses may accept payments from across the globe by promoting several languages and currencies, which makes their business truly global. Through getting this built into the payment portal, businesses may stop negotiating with international banks and other institutions for which they might not be prepared to do business.

What are the various transaction that payment gateways software can execute?

Authorization

A kind of transaction that is used to check if a customer has adequate capitals to pay. It doesn’t contain the actual money transfer. As an alternative, during approval, a merchant guarantees that a cardholder is capable of paying for an ordered item. An authorization transaction is normally used for orders that consume time to ship or manufacture.

Capture

The actual handling of a previously approved payment subsequent in funds being transferred to the merchant’s account.

Sale

This is generally a blend of authorization and capture transactions. A cardholder is first approved. Then the funds may or may not be captured. It’s a systematic payment for instant buying, such as a subscription purchase, or e-tickets.

Refund

The consequence of a negated order for which a merchant will have to apply a refund payment processing in order to return the money.

Void

This transaction is similar to refund but it can be done if funds were not yet taken.

Payment Processing Infrastructure

The kind of infrastructure that is required for online payment processing is slightly more complex than users might visualize. For the customers, it’s signified by only a small window, or a distinct website, where they have to pass via the checkout. But essentially, processing includes numerous financial organizations, or tools, confirming the transaction data on both the ends and enabling the customers to finish the purchase in a few seconds.

Whenever a customer checks out

Passing the card number, expiry date, and CVV - A payment gateway solution has to perform numerous tasks, which take roughly about 3 to 4 seconds.

Customer

When a customer clicks a “Purchase” button and updates the required fields to pass the transaction data. The data is encoded and transferred to the merchant’s web server through an SSL connection.

Merchant and payment gateway

Post the receipt of transaction data, a merchant passes it to the payment gateway through another encoded SSL channel.

Payment processor

The data goes to payment processors. These are the firms that deliver payment processing services as third-party companies. Payment processors are linked both with a merchant’s account and a payment gateway, moving the data back and forth. At that phase, a payment processor is basically transferring the transaction to a card network (Visa, Mastercard, American Express, etc.).

Card networks

The key role of a card network is to authenticate the transaction data and transfer it to the issuer bank (the bank that created the cardholder’s credit or debit card).

Issuer bank

The issuer bank also receives or denies the approval request. In reply, a bank sends a code back to the payment processor, which comprises the transaction update or mistake details.

Payment gateway

Transaction status is reverted to the payment gateway, then transferred to the website.

Customer and issuing bank

A customer gets a message with the transaction update (approved or rejected) through a payment system interface.

Issuer bank

Inside a couple of days (usually the next day), the funds are moved to the merchant’s account. The transaction is implemented by the delivering bank to the obtaining bank.

Potential Issues with Payment Gateway Software

Integrations 

While e-commerce systems may be one of the most decisive factors to consider when choosing a payment gateway, other software implementations also need to be taken into account. Tools for handling subscriptions are also combined with best payment gateways software to handle ongoing consumer purchases. Additionally, you will need to consider shopping cart tools as they allow users to pick items for purchase and create a total amount to be made to pay through the payment platform.

Currencies and form of payment

Payment systems are restricted by the nations and currencies they endorse. It also allows companies in the e-commerce industry to have more than one payment portal to account for more customers. In addition, tools in this segment are restricted by the methods of payment they accept: credit cards, ACH payments, split payments etc. Before implementing a new payment portal into your e-commerce store it is important to consider where your consumers are and the payment methods that they use.

Transaction fees 

For each transaction, most payment gateways will charge a small processing fee. This payment can be either a fixed amount or a small proportion and is often determined on a monthly basis by how many payments e-commerce business processes. Small companies typically pay a lower premium than e-commerce firms at the company stage. Monthly and registration fees are popular for most gateways of payment, too.

Considerations when Choosing Payment Gateways

Operations base

While the company's physical distance to gateway supplier may not be a huge issue, the business rules play a significant role. Before you even start accepting payments, make sure you have sufficient knowledge of your supplier's established rules and confirm if they are in perfect alignment.

Business nature

You may also wish to reveal your business to your gateway vendor before a deal is closed. Some suppliers can get selective with their customers' business, for some purpose. There are so-called high-risk markets such as gambling, poker, and pornographic entertainment that companies might be averse to and fail to cover.

Payment terms

How quickly can you start receiving your payments, and how much will you be charging the gateway? These are some of the queries you might need to formalize before you register the dotted line with your provider. Most sellers will be more than delighted to provide you with upfront knowledge, but some comparative research may be needed.

What are the most important Payment Gateways Software trends in 2021?

Mobile apps

Potential customers use their mobile devices to access cloud services to check-out within the store and pay for stuff before they step into the store. Savvy retailers such as Starbucks, Taco Bell, Domino's Pizza, Walmart, and Kohl leverage this phenomenon to sell mobile payment devices, which have seen their revenues grow.

Safer and easier payments

Many governments have achieved faster payment facilitation systems. Over and above speed, gateways and applications have become more adaptable and convenient. To secure online transactions, they ensure that their systems meet safety, compliance and risk management regulations.

Contextualized trade

Payments enable customers to participate in different digital interactions every day. Each day people spend many hours on the internet on various tasks. Companies track their actions and attitudes digitally to influence and trigger buyouts. These are spontaneous transactions that allow payment in creative ways.

Transparent payments

When more and more people choose electronic payment for daily purchases, consumer interaction is progressing gradually towards transparent transactions. This ensures transfers are combined with the purchase, so users don't need to input their payment details frequently. Types of smooth, transparent transfers include e-wallets, credits/rewards in-app, or authorisations for apps.

Recent Developments

In December 2019, Payoneer, a cross-border payment platform acquired Optile which is a next-generation independent payment platform to scale, unify, and optimize your payment setup.

In November 2019, PayPal, an online payment solution provider acquired Honey which helps people make smarter choices when they shop online.

In November 2019, Razorpay, a platform that enables businesses to accept, process, and disburses payments acquired Opfin, the best payroll software, payroll companies for small business

In October 2019, PayPal, an online payment solution provider acquired Gopay which provides third-party payment services for governments and corporations.

In August 2019, Razorpay acquired Thirdwatch which prevents fraud in digital, banking and e-commerce transactions in real-time using AI

In October 2018, Mobikwik, a financial services company that provides a fintech platform designed for online payments, life insurance, and loans acquired Clearfunds which provide Online, discount mutual fund robo-advisor for India