Shopify Payment Gateways: Choosing the Best Option for Your Business

Cashless transactions have evolved from mere convenience to a crucial necessity for retailers. With consumers progressively favouring online shopping, there is a growing demand for a smooth, secure, and rapid payment process. 

Geographical limitations and operating hours no longer confine your business. Opting for the appropriate online payment gateway can provide essential analytics, lower shopping cart abandonment rates, and establish layers of security to safeguard both e-commerce businesses and consumers.

What is an e-commerce payment gateway?

A payment gateway is an intermediary between an e-commerce website and a payment processor. An e-commerce payment gateway is essential for cashless transactions. 

A payment processor is the one that facilitates the transaction between the customer’s credit or debit card and the bank. While it is possible to go through the payment processor directly it is advised to use a payment gateway for added security and functionality. 

In case you are not using a payment gateway then as a business owner you will have to handle sensitive payment and bank details yourself increasing the risk of fraud and limiting the number of payment methods and currencies. Payment gateways also offer additional features like analytics, fraud prevention and support for multiple payment methods and currencies.

To understand more about Shopify and payment gateways consult a Shopify development company.

How does an e-commerce payment gateway function?

• The customer enters their payment information, the gateway encrypts and securely transmits this data to the payment processor
• The payment processor communicates to the bank for authorization
• Once the authorization is received the gateway sends it to the e-commerce platform, allowing the transaction to be complete.
• The financial institution transfers the funds from the customer’s account to the merchant’s account or business bank account. 
• The payment gateway gets a % of this transaction

How to choose the best payment gateway for your store?

As a store owner, you must select a payment gateway that will accept credit and debit card payments, net banking and UPI payments smoothly and securely. 

Some of the factors to consider are:

1. Pricing and other charges- most payment gateways charge a certain % of each transaction along with a fixed monthly fee. They might also offer custom pricing for large orders. 
2. Payment methods- whichever payment gateway you select should support multiple payment options like debit cards, credit cards, UPI, mobile wallets, net banking etc. Many also offer international payment methods like PayPal, and Apple Pay and the option to split the payment into EMIs. Choose the one that fits your requirements and that will fit seamlessly with your online store.
3. Regulations and security- as sensitive data is involved you need to ensure that security is a priority. You should be protected against hacks, leaks and breaches. Some of the standards and security-related practices that should be followed by a payment gateway are 128-bit encryption, SSL, and Payment Card Industry Data Security Standard (PCI-DSS).
4. International payments- if you offer global services then your payment gateway should be robust enough to handle multiple currencies and payment methods. Also keep in mind transaction fees will be different for international payments. 
5. Availability and reliability- it is important that your payment gateway is reliable and has strong customer support in case of any emergencies. If your payment gateway stops working then your customers cannot shop which means a loss in total revenue for you.
6.  Hosted vs Integrated payment gateways- a hosted payment gateway will redirect the customers to the payment processor’s platform whereas an integrated gateway will let the customer stay within the store, fill in their details and place the orders.Both of these can have their pros and cons. Hosted gateway takes care of the entire payment process and the store owner doesn’t have to worry about any technicalities. However, the redirection to a different page may lead to customer inconvenience and affect conversions. In integrated gateways, the store owner has to take responsibility to ensure the data is safe and understand the technical aspects as well. The advantage is that they have control over the user experience throughout the checkout process. 
7. Merchant account- some gateways require you to sign up for a merchant account while others transfer the money directly to your bank account. The latter might result in high transaction fees. Be clear as to what are the charges. 

Selecting the right Shopify payment gateway is a pivotal decision for the success of your business. Each option comes with its own set of features, fees, and considerations, making it essential to align the choice with your specific business needs and customer preferences. Make the best choice ensuring a secure and efficient payment experience for both you and your customers on the Shopify platform. Shopify experts are available to assist you in every step, from the creation of your Shopify store to its development, design, and successful launch.