Payment gateway market value is estimated to cross $1 Billion in the next five years.
In this new era of technology, e-commerce along with online shopping has become a crucial part of our day-to-day lives. This way, the key reason behind the idea to integrate payment gateways into mobile apps. With the feature of payment system gateways, the users can quickly pay for their good and services online. It includes paying for electricity bills, booking plane tickets and many other services.
The integration of payment system gateways has now transformed into a feature that a majority of mobile, as well as web applications, include which is one of the many reasons why you shouldn't underestimate the role of payment gateways in businesses. Keep on reading if you want to know about the other reasons.
Just a couple years back, the credit cards were considered to be the most convenient form of payments and now we have options like net banking and online payment system at our disposal. And all of this has become possible because of the integration of payments gateways in our mobile apps.
If a user wants to purchase a product or service through the means of an application, then payment gateway services are your only option. But in this procedure, there is a mediator involved in between the transaction, that the user wants to perform with the financial institution, i.e., a payment system/processor.
The involvement of a mediator is significant because due to the security reasons involved in the direct interaction between the payment processor and the mobile app.
If you are in the process of developing an app that involves some money-related operations then this is the article for you.
To overcome security measures, a security element is used by the payment gateway services. This element also uses encryption to make sure that the processing of sensitive information is protected. Payment gateways are a fantastic facility, especially for online businesses that make the payment procedure efficient and straightforward.
One of the mandatory requirement to use the payment gateway service is a stable internet connection so that the end-users can utilize this digital service. Along the process, a user is asked about filling their credit card or debit card details either before making a purchase or after placing the order of that particular product/service.
Initially, the information is sent to the mobile payment systems which are then transferred to the bank where the debit/credit card is from. When the bank receives the information, then it syncs the data with the MasterCard and Visa requirements. The main aim of the payment gateway system is to verify that if the user has raised a genuine request for a purchase or not.
So, if the user's purchase request is verified from the bank, then it is directly sent to the merchant to authorize the request that is raised. Once this is done, then the transfer amount that is charged to the user is sent to the merchant's business account.
According to the U.S. Census Bureau report, the e-commerce retail sales increased by 16% to $453.5 billion in the year 2017; this report was released on February 16, 2018.
Before selecting a mobile payment gateway system for your app, there is one thing that you need to focus on 'the seller account type.' A seller or merchant account can be referred to as an online account where the payment is placed for a small period. And when the payment gateway system processes the payment, it is moved forward. Right now, there are only two main types of seller accounts:
Known PayPal Clients: Telstra, eBay, and Google Play
Pricing: The account generation is a free process in PayPal, but it charges 2.9% + $0.30c per transaction. Another thing that is worth mentioning is that the percentage drops with higher amount in the transactions.
Known Braintree Clients: Shopify, Airbnb, Uber, and WooCommerce
Pricing: The transaction fee of Braintree is 2.9%+ $0.30 per transaction, but this is after the first $50,000 and along with this a $15 chargeback fee is charged.
Known Stripe Clients: Fitbit, Magento, Bigcommerce, and Lyft
Pricing: The transaction fee that is charged by Stripe is 2.9% + $0.30 fee but this is after the first $1 million, and then a $15 chargeback fee is charged as well. In Stripe, there are no contractual requirements to be filled.
Known Stripe Clients: Wix and Burberry
If you want to read more about the development cost of an application, then don't forget to read our previous article on the cost to develop an app. Also, in case you are wondering about how to create a mobile app to accept payment, ahead of over to our ‘app development’ section.
By integrating payment gateways, the user can accept electronic payments via a mobile app, which increases their ease of usage. Now, accepting payments from a mobile app has become a common phenomenon that has wholly melded itself into our daily activities.
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