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Payment Gateway Integration refers to the process of incorporating a third party service into a website or application to handle financial transactions securely. This exchange primarily occurs between merchants and customers, ensuring the safe transfer of funds from users to merchants. The paramount objective is to maintain the security of all financial data, safeguarding it against potential hacking or attacks.

Payment gateways act as secure middlemen for online transactions, letting users pay easily and merchants receive payments safely. They encrypt data, process payments instantly, and offer various payment methods. Integrating one into your app is crucial for a smooth, secure, and versatile payment experience, boosting user trust and business success. Trustworthy service providers like EverExpanse can help ensure a secure and seamless integration.

Hosted Gateway
A hosted payment gateway operates as a third-party intermediary, requiring customers to temporarily leave your website to complete a transaction. The customer is redirected to a payment gateway web page to input their credit card details and upon completion, they return to the merchant's site for finalizing the transaction.

Seamless payment processing handled by the service provider.

No need for PCI compliance, simplifying integration.

Integration guides readily available on vendor websites.

Limited control over the hosted gateway.

Potential trust issues with third-party payment systems.

Redirecting customers may impact conversion rates and branding.

Integration: Typically, integration involves following the integration guides provided by vendors, often through an API.
Best Fit for: Small or local businesses comfortable with external payment processors.

Direct Post Method
The Direct Post method is a technique where sensitive payment data is sent directly from a customer’s browser to the payment processor’s servers without passing through the merchant’s server. It enables customers to make purchases without leaving the merchant's website. PCI compliance is not required, as transaction data is immediately posted to the payment gateway upon the customer clicking the "purchase" button.

Retains customization options and branding capabilities.

No PCI DSS compliance needed.

All necessary actions performed on a single page.

Limited security compared to integrated payment gateways.

Integration: Involves setting up an API connection between the shopping cart and the payment gateway.
Best Fit for: Businesses of all sizes seeking a secure, on-site payment experience.

Non-Hosted (Integrated) Method
An integrated payment gateway involves no third-party intermediaries during the payment checkout stage. It refers to the approach where customers stay on the merchant’s website throughout the entire payment process, including entering their payment details. Companies opting for integrated gateways attain PCI DSS compliance, taking responsibility for storing, securing and verifying each transaction.

Full control over transactions on the website.

Customizable payment system tailored to business needs (flexibility in customization).

Potential source of revenue for merchants becoming payment service providers.

Requires PCI compliance, with associated infrastructure and expenses.

Integration complexities for adding custom functionality.

Integration: Non-hosted payment gateways are integrated via APIs to the server, necessitating an engineering team for implementation.
Best Fit for: Medium and large businesses emphasizing branding and user experience.

Customer
The customer initiates the process by selecting the desired product and entering necessary information, such as card details and CVV, to facilitate the transaction. Transaction data is encrypted and secured to prevent unauthorized access. The merchant server receives the data through a secure SSL connection.

Payment Gateway
Merchants transmit transaction data to the payment gateway via another secure SSL connection. The payment gateway stores this data in the form of tokens for future reference.

Payment Processor
Acting as a third-party intermediary, the payment processor links the merchant's account with the payment gateway. Facilitates the exchange of data between the payment gateway integration and the merchant's account, with the payment processor forwarding information to the card network.

Card Networkr
Card networks, such as Visa and Mastercard, play a crucial role in passing transaction data to the issuer bank.

Issuer Bank
The issuer bank evaluates the request received from the card network and either approves or rejects it.Sends a transaction status code back to the payment processor.

Payment Gateway
Receives information about the transaction status from the payment processor. Communicates this data to the website.

Customer and Bank
The customer receives a notification with the transaction status through the payment system. The merchant observes the funds transferred to their account within a few days.

Assess Your Needs
Begin by evaluating your company's requirements. Engage with stakeholders to gather data and identify the necessary features for your app's payment system. Address potential conflicts, regulatory risks and devise solutions for a smooth online payment experience.

Project Planning
Plan your project by defining the budget, timeline and deliverables. Establish clear objectives and key performance indicators (KPIs) to guide the development process and ensure a successful integration of the payment gateway.

Design Payment Gateway Integration
Based on your needs and payment gateway type (hosted, self-hosted, API-hosted or local bank integration), design the payment system for your app. Define features and architecture for a custom payment gateway that aligns with your project goals.

Choose the Right Tech Stack
Explore available technology tools and frameworks that match your designed payment gateway. Select a tech stack that best suits your requirements, ensuring compatibility and efficiency in the integration process.

Implementation and Testing
Develop the custom payment gateway according to your design and plans. Create features and elements that define your payment system. Conduct thorough testing to identify and rectify any errors or bugs, ensuring a smooth and reliable payment gateway integration.

Support and Maintenance
Collaborate with service providers like EverExpanse to receive ongoing support and maintenance. Benefit from their expertise to address evolving needs and demands, ensuring your payment gateway remains cutting-edge and effective. By following these steps, you can successfully integrate a payment gateway into your mobile application, providing users with a secure and seamless online transaction experience.