How Payment Gateways Secure your Online Transactions

The utility of payment gateways can’t be ignored in today’s time where internet is the key of everything. Here are the technologies they use to secure your transactions and a hands-on demo to setup the oldest and most popular payment gateway

A payment gateway is an online platform that provides a secure connection to carry out the transaction process between an e-commerce entity and the internet merchant account. It verifies, accepts or declines the transactions in real time on a merchant’s behalf through secure Internet connections.

The payment gateways form the basis of online transactions. If you own an online store, then without a payment gateway, you cannot sell your products and services to your customers. You need a secure and speedy channel that allows you to process credit card and electronic check payments of your customers. And if you are a customer and wish to buy something online, then you have to do it through a payment gateway only.

The steps involved in an ecommerce transaction:

1.    A customer purchases an item and enters his card details in the e-commerce checkout.

2.    Details about the purchase are sent by e-commerce checkout to the payment gateway for processing.

3.    The payment gateway forwards transaction information to the seller’s bank.

4.    The seller’s bank forwards transaction information to the bank that issued the buyer’s card to authorize the transaction.

5.    The bank that issued the buyer’s card verifies the buyer’s card details and either approves or denies the transaction and sends that information back to the seller’s bank.

6.    If the transaction is approved, the bank will deposit funds on a merchant’s account at a scheduled time.

7.    The payment gateway sends transaction details and response back to the e-commerce entity.

8.    E-commerce service then lets the buyer know if the transaction was approved or denied.

Is your money in safe hands?

Buying stuff online is easy, saves time and money, however there’s a risk involved. Each time we pay for something, we input our credit/debit card details to a third party (other than our bank). And considering the virtuality of online medium and the risks associated with it, there’s always a sense of fear for online fraud. However, these e-commerce platforms and banks tend to maintain a robust framework to securely carry out the transactions for the goods and services we pay for.

Let’s check out some of the security methods used by payment gateways to safeguard customer’s money:

Data Encryption

Data encryption is one of the main security method used in payment gateways. Once you enter your card details in the payment gateway, it gets encrypted by using payment gateway’s public key and can only be decrypted by the payment gateway’s private key. The gateway uses an algorithm which makes sure that no unauthorized party can decrypt the encrypted data when being transmitted through the network. These algorithms usually follow symmetric (same key for encryption and decryption) or asymmetric (different key for encryption and decryption) cryptography to mask data so that unauthorised sources are unable to read or intercept it.

Secure Socket Layer (SSL)

Secure Socket Layer (SSL) is the standard security protocol used in online transactions to establish an encrypted link between a web server (where the payment is taken) and a browser (where the payment information is entered). E-commerce websites uses SSL to authenticate their identity to the visiting customers and to protect sensitive information such as card details entered by the customers. It is advisable to make an online transaction on websites which have SSL certification. You can check out the same for a website by noting the https prefix in the URL address of the website in the browser and by locating the Padlock symbol in the web browser.

Secure Electronic Transaction (SET)

Developed by Visa and MasterCard, the Secure electronic transaction (SET) protocol is used to aid the secure transmission of customer’s credit/debit card details during online transactions. The protocol blocks out the details of credit card information, thus preventing merchants, hackers and unauthorized parties from accessing the sensitive information. SET uses customer digital signatures to maintain confidentiality, authentication and data integrity

Setting up PayPal Payment Gateway

Founded in 1998, PayPal is one of the longest established services for transferring money online. It processes  almost 12.5 million payments per day and has 165 million active customer accounts. The platform offers the flexibility to pay using PayPal account balances, bank accounts, PayPal Credit and credit cards.

PayPal is available to people in 203 markets and allows its customers to get paid in more than 100 currencies, withdraw funds to their bank accounts in 57 currencies and hold balances in their PayPal accounts in 26 currencies. Moreover, the platform does not charge any monthly fees from its shoppers.

Here’s how you can create an account on PayPal:

1)    Visit www.paypal.com/in and click on signup to create a new account.

2)    If you wish to simply buy goods and services online then choose the individual account, otherwise go for businesses if you want to sell goods and services.

3)    Click on Get Started to fill in your details as shown in the picture.

4)    Click Agree and create account to start buying or selling securely on PayPal.

You can also check some of these platforms for online transactions:

CCAvenue

One of the largest payment gateways operating in Indian market. The platform incorporates more than 100 payment options and collects funds in over 27 different currencies.

EMVANTAGE

Another largely used payment gateway in the Indian market. It boasts of very high transaction success

rates and offers users the choice of a wide variety of payment options like credit cards, debit cards, net banking, etc. Moreover it also lets them use prepaid cards like Rupay, etc.

Citrus

Citrus is the well known name behind the innovative Citrus pay app to tackle everyday problem of Indian population ‘chutte nahin hai’. It includes a range of tools like Turbo checkout, Citrus Cash, Citrus Cube, etc. for end consumers to make their shopping experience more fun.

Atom

Atom has a client base of over 4500 companies and integrates more than 100 payment options and has executed 15 million plus transactions to date. The platform includes major credit cards services including MasterCard, American Express, etc, 50+ Debit Cards options and over 50 net banking options.