What is Payment Gateway? How It Works and the Benefits

Payment gateway is one of the technological sophistication that is now a trend in the world of transactions in the digital era. This technology allows users to make payments to other users without the need to come to the bank.

For example, bank transfers and virtual accounts no longer require the account holder to go to the teller at the bank, in order to make payments at online stores.

Because Payandplay itself is quite old, of course, most users have heard of this term. However, for a handful of users who are still confused and don't fully understand the benefits and workings of a payment gateway, please read this article further.

Some basic explanations that you need to know about payment gateways are as follows:

DEFINITION OF PAYMENT GATEWAY

Basically, payment gateway is a transaction system that has been provided by a technology-based marketplace service. A service that can provide payment authorization (power of attorney) directly to users in online business activities.

Payment gateways are certainly very useful for buyers in e-commerce because they have effective value and efficiency in the world of transactions. Through this service, sellers who are in the online business world can carry out transactions and manage finances easily.

Uniquely, some of us may have used this feature but are still not aware that the service is entered as a form of payment gateway. The form of services will include bank transfers, virtual accounts, e-wallets, credit, debit cards, and other similar things.

Through the example above, the payment gateway will inform the transaction process from the marketplace, the buyer, to the bank.

An important point that is very vital in this system is that the process takes place in a safe condition, considering that incoming transactions are confidential and important.

SECURITY SYSTEM OF PAYMENT GATEWAY

The payment gateway system requires several points for smooth online transactions, whether it's the process of using it, and the data privacy of the sellers and buyers always maintained.

The payment gateway security system is as follows:

- Card security code; a security system that requires users to enter the last three-digit code on the card in each transaction. Payment by credit or debit card can be done automatically when the user enters the verification code.

- Address Verification System (AVS); As the name implies, this form of payment uses an address verification system. AVS will later track and check billing data made by consumers. This check uses the address that has been registered in the debit and credit card data.

- 3D secure passwords; is the last form of a payment gateway security system that will ask for a password from the user before logging in or logging into a payment account so that only the account owner can process transactions online.

BENEFITS OF PAYMENT GATEWAY

After understanding the definition and form of the security system, of course we can understand a little about the benefits of payment gateways. For more details, let us describe some of the benefits in the world of transactions:

- Process transactions in seconds; allows the transaction process between the seller and the buyer quickly. So that the buying and selling process in the marketplace becomes more efficient and can be done anytime without queuing at the bank.

- Maintain transaction security; will help users to transact securely from cybercrime. In addition, the data of buyers and sellers are always protected.

PAYMENT GATEWAY WORKFLOW

To make it easier to use, you can follow several stages of how the following payment gateway works:

1. Consumers conduct e-commerce transactions; upon check-out, users will be faced with various payment methods.

2. Payment processor stages; when the payment is confirmed, the payment process is immediately received by the user's bank.

3. The bank sends a reply; then the bank will send a reply in the form of a special code that explains the success or failure of a transaction.

4. Payment gateways receive special payment codes; This special code and information will go to the payment gateway for the transaction.

This is an explanation of what a payment gateway is, its benefits, how it works and the implementation process. Broadly speaking, a payment gateway is a service provided by e-commerce to facilitate the buying and selling process.