Buyers’ Guide: Choosing a Payment Gateway Provider

From chargeback fees to PCI-compliance issues, this ecommerce buyers’ guide will tell you everything you need to know to select a payment gateway service provider.

In electronic commerce, a payment gateway is the term used to describe an application service provider that authorizes and processes electronic payments between you, your customer, the customer’s credit card-issuing bank and your own bank.  It is an important piece of the online transaction puzzle. Just like having a merchant account or a Web site — you need a payment gateway to conduct online transactions.

Think of a payment gateway as the online equivalent to the point-of-sale terminal found at brick-and-mortar stores.  A payment gateway lets you accept credit card, debit and other forms of electronic payments on your Web site. 

A payment gateway is actually a system of computer processes that transfer, verify, submit and receive transaction information to the credit card network on behalf of the merchant, using secure Internet connections. The payment gateway is the infrastructure that allows a merchant to accept credit card and other forms of electronic payments. 

Buyers’ Guide: Choosing a Payment Gateway Provider
By Vangie Beal, March 9, 2010

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