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Direct or Redirect Payment Gateways – Which to choose?

Payment gateways is a service that has laid the foundation for the modern e-Commerce era. Whether you own an e-Commerce or about to, having at least one payment gateway is a must, therefore we recommend giving this article a look if you are not familiar with its variance. This entry will explain what payment gateways are and how common types of payment gateways used on e-Commerce sites works. We also analyze their advantages and disadvantages so you can decide which one suits your business better.

 

What are payment gateways?

 

Payment gateways are services that process card payments for e-Commerce stores. Payment gateways enable these transactions by transferring payment information between e-Commerce websites and banking service providers. It can also help customers to estimate the scale of the business through the number of payment gateways it offers.

 

Why are there so many payment gateways?

 

You have probably heard of Paypal, Amazon Pay, Strife, Sage Pay, etc. They are all payment gateways, but why are there so many of them? Imagine this, your customers might come from different countries, each has a preferred method of payment. Yet, you only support Paypal. Although Paypal is great and popular, not everyone uses it. Geographic, linguistic and cultural factors influence the choice of payment methods that customers use. If businesses want to be a multinational or global online retailer, adding more payment gateways to their stores helps them gain access to a larger market base.

 

 

Redirect payment gateways

 

redirect payment gateways

 

After  customers proceed to checkout with their cart, the site takes them to a secured payment page hosted by the payment service provider (PSP) to complete payment. The PSP will verify the validity of the card and perform authorization. Upon completion, the customers will be redirected back to the e-Commerce site.

iframe payment gateways

 

A more common type of redirect payment integration is IFrame, which shrinks the payment page to fit inside the checkout page. This offers a more friendly look while still functions as a standard redirect method.

 

 

 

Benefits

 

⋅ Customer Safety Assurance

PSP are trusted worldwide and they comply well with security requirements. Using redirect payment gateways helps the customers to feel more confident as their information are in the hands of those who are well-known for handling them securely.

⋅ Reduced PCI DSS requirements for businesses

The PSP captures the card details, e-Commerce site will not be responsible for the data.

 

Cons

 

⋅ Lacks customization

Because the site redirects customers to the PSP’s end, there is not much you can do about the payment page. The best thing you can do about the payment site is adding your brand logo to reassure the customers that you are still with them.

 

Direct payment gateways

 

direct payment gateways

 

A direct payment gateway allows customers to remain within the e-Commerce website to complete the process. Therefore, only payment details are sent to the PSP for authorization. In other words, the e-commerce server will keep transaction, payment and customer information.

 

Benefits

 

⋅ Highly customizable

Embedding the payment page into the e-Commerce site allows merchants to customize its interface to fit with the whole website.

⋅ Consistent Customer Experience

Because customers stay on the e-Commerce site, they will feel more comfortable and less confused when submitting their information.

 

Cons

 

⋅ Slightly higher cost

Takes more effort to work with than redirect payment gateways as direct payment gateways require more customization.

⋅ Strict PCI DSS requirements

The e-Commerce businesses will be liable for the security

There are a lot of popular providers, most notably are PayPal, Amazon Pay, Strife, Sage Pay, … as we have mentioned above. Each of them offers both direct and redirect payment integration options for e-Commerce businesses. If you still wonder which type of payment gateway integration to choose or need more technical information, you can check out our Payment Integration Extensions for Magento 2 to know more about payment gateways. Should you need more assistance, we at sale@magenest.com are here to help!

Author: Harvey

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