Types of payment gateways and their benefits

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What are the benefits of different types of payment gateways?

Pine Labs : Default

By Pine Labs | December 18, 2023

India's payment gateway market is expected to reach a whopping USD 3.2 Billion by 2033. With this growth, having a strong and secure payment gateway is crucial for the success of any business. Payment gateways serve as the bridge between a merchant's website and their customers, enabling smooth and secure transactions. As a merchant, understanding the benefits of different types of payment gateways can help you choose the right one for your business needs.

Let's explore the primary benefits and explore how they can enhance your business operations.

Understanding the types of payment gateways

Before we discuss the benefits, it's important to understand the different types of payment gateways available. Broadly, payment gateways can be categorised into three types:

  1. Hosted payment gateways: These gateways redirect customers away from your website to complete their payment on the gateway's secure platform
  2. Self-hosted payment gateways: These gateways allow customers to complete their payment on your website itself without any redirection.
  3. API-based payment gateways: These gateways integrate directly with your website through APIs, providing a seamless and customisable payment experience.
Types of payment gateway Benefit Description
Hosted payment gateways Enhanced security Managed by third-party providers, these gateways maintain high levels of security and compliance with industry standards such as PCI DSS, reducing the risk of data breaches by processing sensitive information on secure servers.
Simplified compliance The burden of PCI compliance shifts to the gateway provider, simplifying compliance requirements for merchants and allowing them to focus on other aspects of their business.
Easy integration They are easy to integrate with websites through plug-and-play solutions, requiring minimal technical expertise and allowing merchants to start accepting payments quickly and efficiently.
Self-hosted payment Gateways Seamless customer experience Customers complete transactions without leaving the merchant's website, creating a consistent experience that can lead to higher conversion rates and increased customer satisfaction.
Brand consistency Allows full customisation of the payment page to match the merchant's brand look and feel, reinforcing brand identity and creating a cohesive shopping experience.
Greater control over data It provides merchants with greater control over their transaction data, which is beneficial for analysing customer behaviour, tracking sales patterns, and gaining insights into operations to inform business decisions and drive growth.
API-based payment gateways Customisable and flexible Enables highly customised payment experiences tailored to unique business needs. Businesses can integrate the payment gateway seamlessly into existing systems, enabling advanced features such as subscription billing and multi-currency support.
Scalability It is capable of handling large volumes of transactions and easily scaling as the business expands, ensuring reliable and consistent payment processing capabilities to keep up with increasing demand.
Enhanced user experience Allows merchants to design a user-friendly and efficient payment process with features such as one-click payments, saved payment methods, and personalised checkout experiences, reducing cart abandonment and boosting sales.

Comparing the different types of payment gateways

Now that we know the difference between different types of payment gateways let's explore their unique benefits.

  1. Compliance: Hosted payment gateways simplify compliance by shifting responsibility to the gateway provider. Self-hosted and API-based gateways require merchants to handle their own compliance, offering greater control but more complexity.
  2. Integration: Hosted payment gateways are easy to integrate with minimal technical expertise required. Self-hosted payment gateways require moderate integration effort as merchants manage the payment process on their sites. API-based payment gateways involve complex integration but provide the highest level of customisation.
  3. Customisation: Hosted payment gateways offer limited customisation as the payment process is managed off-site. Self-hosted payment gateways allow for high customisation, maintaining brand consistency. API-based payment gateways provide very high customisation, allowing for a fully tailored payment experience.
  4. Control over data: Hosted payment gateways offer limited control over transaction data. Self-hosted payment gateways provide high control over data, allowing for detailed analysis and insights. API-based payment gateways offer very high control, enabling full access to transaction data and advanced features.
  5. User experience: Hosted payment gateways provide a good user experience with a straightforward payment process. Self-hosted payment gateways offer an excellent user experience by keeping customers on the merchant's site throughout the transaction. API-based payment gateways provide an excellent user experience with features like one-click payments and personalised checkouts.
  6. Scalability: Hosted payment gateways offer good scalability, suitable for small to medium-sized businesses. Self-hosted payment gateways have moderate scalability, requiring more effort to handle increasing transaction volumes. API-based payment gateways offer excellent scalability, capable of handling large volumes of transactions and supporting business growth.

    7. Bigger gains with Pine Labs payment gateway

    As a merchant, selecting the right payment gateway depends on your specific business needs and priorities. A reliable payment gateway like Plural by Pine Labs can be a one-stop solution for you. Understanding the benefits of different types of payment gateways is essential for making an informed decision.

    Each type offers unique advantages that can help streamline your payment process, enhance the customer experience, and support your business growth. By carefully evaluating your needs and considering the features of each type, you can choose Plural by Pine Labs and set yourself up for success. To know more about the best benefits of Plural, visit us at https://www.pinelabs.com/online-payment-gateway.

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