With the evolution of digital business and e-commerce, the business landscape has changed forever. As a fundamental pillar of business, payment methodologies have also seen a drastic transformation. At a fundamental level, online payments and digital fund transfers are direct alternatives to traditional payment methods like cash and cheques.
Digital payments require a secure gateway or terminal through which all transactions get routed. With technology evolving at a rapid pace today, a gateway payment online in 2022 is far more advanced than the ones available decades ago.
Payment Methods Before the Internet:
Credit card network Visa created the first credit card terminal in 1979. Ingenico, Verifone, Hypercom, and other hardware manufacturers rose to fame and popularity with e-payment platforms during the 1980s. Telecommunication and data management platforms came together in this ecosystem to create a network that ensures efficient and cost-effective e-payments that could be accepted globally. The credit card terminal ecosystem evolved at an exponential pace till its momentum shifted to the highly-potent world wide web during the 1990s.
The internet took a completely different approach to digital payments compared to anything that existed at the time. It made virtual payment terminals necessary and possible for online businesses. Companies like CyberSource and Authorize.Net entered the race to fill the gap that was created. These companies are the globally recognized web-based correspondents of payment terminals, the gateways that have adapted to virtual transactions by integrating them with their existing payment processors.
Changes Driven by Technology:
Payment processors that chose popular payment gateways instead of building gateways in-house faced several problems. Most of the systems they purchased were new, while customers were still using old platforms for online transactions. Migrating to a new platform was as challenging then as it is now.
Additionally, businesses kept improving their merchant segments to specialize in them, making it almost impossible for one gateway to meet the needs of a processor’s entire client base alone. Processes had to own the gateways or build partnerships with multiple gateways.
The integration of payment gateways with software development began in the early 2000s and routed transactions through multiple processors. Besides this, several domains of payment processing were innovated, including local data storage, processing power, sales software integration with payments, and data encryption.
Mobile Payment Gateway Technology Today:
Today, businesses provide several options when it comes to choosing a payment provider. These options can be broadly categorized into
- Traditional banks that provide payment processing services using various technologies, some of which grew in the 1980s.
- Gateway-only startups use technology that must be integrated with older infrastructures as their role in the value chain of payments is quite marginal.
- Several businesses also provide standalone solutions that protect against fraud. However, these require more personnel investments for fraud and payment management separately.
Choosing the right payment option and integrating it into an existing business is challenging. There is an easier solution for this. Businesses can choose an entire payment value chain that will manage the payment process entirely right from the checkout to the final balance statement generation. Using an integrated end-to-end mobile payment gateway terminal for online payments is the way to go.
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