eCommerce business owners and merchants use an online payment gateway to authorise their transactions and accept payments online. It ensures payment security while transmitting sensitive information and processes it to an eCommerce website or virtual station.
Accepting digital payments enables a merchant to accept cashless payments from customers’ cards or phones. In 2022, accepting online payments has become a necessity for any business.
It sounds like there are numerous benefits of accepting online payments through a payment gateway. However, it brings with it some challenges too.
This article will help identify online payment challenges that could impact a business. Read on to learn more about the advantages and challenges of a digital payment gateway in 2022, and know how to address them.
Nine Advantages of Using an Online Payment Gateway
Enhanced user experience
A carefully crafted payment gateway allows shoppers to buy their goods in a few clicks. Furthermore, to improve engagement and save time, it saves data securely for future purchases so that customers do not need to fill it in every time. The customer can shop anywhere, anytime, without visiting the physical store.
Quicker transaction time is one of the most significant benefits of using a payment gateway. Apart from saving time, it also brings convenience for both shoppers and merchants. An online payment takes only 2-3 days to reflect in the merchant account, giving ample time to verify the transaction details.
Business owners can easily control their transactions. Every time a customer processes a purchase, the data centre sends the data to the merchants for payment confirmation. Based on this, the merchant can accept or decline the order.
Whenever a merchant starts accepting online payment processing, they are most concerned about security. Traditional ways of receiving payments include the risk of theft, bounced cheques, cash-related issues, etc. Now, various gateways comply well with the PCI DSS security standards. This compliance ensures secure transactions, enhancing the shopper’s trust in the merchant.
An online payment system allows businesses to connect with global customers irrespective of geographical boundaries. Reaching such a vast customer base could not be possible with a physical establishment. Therefore, accepting online payments increases business sales and improves overall operation and performance.
Reduced overhead costs
Running a physical store exhausts money on expenses like infrastructure, office space, workforce, etc. However, the digital medium accepts payments online and reduces overhead costs.
eCommerce merchants do not require human resources and infrastructure to accept online payments. A payment gateway makes the payment system completely automated and organises payments hassle-free.
Multiple payment options for the customers
A payment gateway provides customers innumerable options to make their payments, including debit and credit cards, e-wallets, gift cards, net banking, EMIs, etc. A payment gateway allows merchants to receive seamless payments anytime by automating payment procedures through all these mediums.
Since there is no need to visit a physical store, many customers browse through eCommerce websites in their leisure time and buy on impulse.
Therefore, impulsive buying makes a large portion of all shopping done online. The payment gateway provides a digital platform that encourages shoppers to purchase freely without any time or place barriers. Fast checkout and multiple payment options do not give buyers time to re-think their orders.
Payments for subscription-based services, loan EMIs, and credit card bills are continuous processes. Customers have to remember to pay them regularly, which increases the chance of forgetting the payment.
A payment gateway allows automation, in which the due amount is deducted from the customer’s bank account each month on the due date. As a result, the customer does not need to pay it manually each month, making things easier for the customers and ensuring timely payment for the merchant.
Significant Challenges with an Online Payment Gateway and How to Overcome Them
Low Internet Bandwidth
A low internet bandwidth usually results in failed digital payments. Non-responsive servers interrupt the payment process. Many times, the amount gets deducted from the customer’s account but does not reflect in the merchant’s. Such a situation creates a situation of hassle and mistrust.
To overcome this challenge, ensure that the selected payment gateway works seamlessly even in slow-internet conditions. Using a lite version provides uninterrupted connection and super-quick page loads.
Online frauds like database exploits, scams, phishing attacks, and ID thefts are common in online transactions. Therefore, eCommerce merchants must use a secure gateway with advanced security features to ensure minimal data leaks and theft. The gateway should be PCI DSS compliant, and it must encrypt data before sending it to the server.
Online payment processing is based on technology. So, there are technical problems involved, like slow processing, server error, slow page loading, and other glitches. A payment gateway must look into these issues to maintain smooth operations while accepting digital payments. It’s crucial to choose a gateway that has a reliable and robust support system to resolve any technical problems as they crop up.
Thanks to the internet and social media, smaller businesses can now easily reach a global audience. Online sellers can accept orders from international customers without worrying about transaction success. However, international transactions can be expensive and slow due to banking norms, security, and currency exchange issues. Therefore, select the best online payment gateway that supports real-time currency conversions while accepting international payments.
Cart abandonment is a significant challenge for any eCommerce business. One primary reason for this is a lengthy and tedious payment process during checkout. Multiple details, slow loading times, and complex steps distract the users and lead to a loss for the merchant.
Integrating a robust payment gateway helps carry out a transaction successfully with enhanced speed and ease. A payment gateway must offer a comprehensive experience with clear steps, enabling the user to finalise the order quickly. A secure payment gateway ensures repeat customers and higher sales for the merchant.
Many eCommerce businesses have maintained steady growth with the help of online payment processing. As technology advances, merchants must use products with the potential to turn their business around.
Accepting online payments has several benefits that make transactions much easier and faster than ever before. As far as challenges are concerned, a robust gateway minimises the issues and improves customer experience significantly. It helps solve these challenges and maximises the transaction success rate.