The Importance of Payment Gateway Security for E-commerce

Sales from mobile eCommerce (m-commerce) are expected to take up 43.4% of total e-commerce sales in 2023. In other words, almost half of the e-commerce purchases are now done using mobile devices. One major implication of this for e-commerce firms and small businesses is a renewed emphasis on secure payments. After all, convenience alone is not enough for consumers to share their financial information online.

This is where the payment gateway comes in. A payment gateway is the digital equivalent of a point-of-sale (POS) terminal. It enables secure online transactions and simplifies the sales process for the buyer and seller. This technology also manages financial information such as a customer’s name, card number, and CVV code.

This article explains why a secure payment gateway is essential, especially for startups.

Why do businesses need a payment gateway?

As mentioned earlier, a payment gateway is like a virtual POS terminal that powers secure credit card payments, among other methods of online purchasing. More specifically, the payment gateway is responsible for verifying the customer’s bank card details, checking the availability of funds, and allowing the merchant to receive payment. Another important function of the payment gateway is encrypting confidential data from the client in order to anonymize the transfer of the client’s data to the receiver. A secure payment gateway is a great demonstration of using cryptography for improving cybersecurity.

Why is payment gateway security important?

Lightening a merchant’s burdens

Let’s discuss the most obvious benefit of payment gateways first. A payment gateway company handles sensitive banking and credit card information. They take away this responsibility from the merchant. These third-party companies are focused on keeping data confidential and secure. So, they specialize in website security, data encryption, and the like. On the other hand, you, the seller, can focus on providing products and services. Additionally, most of these payment gateway providers are insured. So, they’ll be accountable for any errors in the transactions.

Having more methods of payment collection

Once your secure payment gateway is up and running, clients will trust you with collecting payments using various methods. Not only will you be able to collect payments from different banks and online banks, but you’ll also be able to utilize phone calls and texts. For example, clients can call you with their payment details so that you can bill their card. You may also offer an option for customers to text you and communicate their financial details securely. 

Serving a larger customer base

Since secure payment gateways allow you to collect financial information with no worries, you’ll be able to attract more customers. More specifically, you will appeal to customers that prefer paying for purchases with their credit cards, online banks, or innovative apps like Earned Wage Access. 

Enhancing customer loyalty

In the digital age, nothing can ruin your reputation faster than a cyber-attack or data breach. On the flip side, making sure that your payment gateway is secure is one sure way to earn customers’ and prospects’ trust and, ultimately, their loyalty. 

Read more: 25 website security measures for eCommerce developer

Increasing customer spending

Window shopping is no longer reserved for malls and shopping centers. Nowadays, customers love to browse products online. If a customer happens to visit your store and sees a product they like, they’ll be able to check out and pay for the item if you have a reliable, easy-to-use payment gateway. On the other hand, if you don’t have an established payment gateway, your customer might choose a product that they can buy instantly, and with their preferred payment method.

Enabling recurring billing

If you offer subscription services, it is important to be able to collect payments regularly. A payment gateway is perfect for collecting payments automatically using an auto-debit mechanism. This saves you time and resources, puts money in your account sooner, and makes it easier for customers to manage their accounts.

Improving user experience

A third-party payment gateway can be customized to fit your brand as well as the needs of your customers. It improves user experience by making purchases more convenient. With a payment gateway, shoppers can pay for products instantly and just wait for them to be delivered to their doorstep. Another key benefit of payment gateways is that they save banking information securely. The next time your customer makes a purchase, they won’t need to fill out a form. Every purchase becomes fast and easy.

Boost Your Ecommerce Website’s Security

Security is the name of the game in e-commerce. A reliable payment gateway lightens a startup’s workload, increases its customer base, and improves its customers’ user experience. All of these lead to further benefits such as higher customer loyalty and increased consumer spending.
If you have more questions about securing your payment gateway or growing your e-commerce business, ask the pros at Webocreation.

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