What You Should Know about Magento Payment Gateways
How well do you understand Magento payment gateways? This article goes beyond the basics, to reveal tips that all Magento merchants can benefit from.
To accept online payments in your Magento store, you will need a payment gateway. This critical ecommerce tool is essentially the online counterpart of the credit card terminal used in traditional retail stores. Its function is to transmit a digital payment request to your payment processor and to transmit the payment approval or denial response back to the customer who is attempting to pay.
The payment gateway also adds an important level of security to online transactions, as all data is first encrypted before passing through the link between your store and the payment processor.
Because of their criticality to order processing, payment gateways are essential for your ecommerce enterprise, but beyond their practical applications, they can also enhance your company’s credibility as a reputable online merchant—provided you choose a well-known gateway with a reputation for reliability and security.
Selecting a Magento Payment Gateway: Some Important Considerations
Payment gateways play a customer-facing part in your business, and a very sensitive one at that, since they must protect customers’ payment information. A single flaw in the payment process can spell disaster for your enterprise, especially if it compromises financial or personal data.
However, choosing a payment gateway is not solely a security matter. If you want your gateway to serve your business well, keep the following considerations in mind when evaluating the many options:
- How appealing is the gateway user interface?
- Does the gateway perform well as part of a mobile checkout process?
- How might the gateway improve the customer experience provided by your Magento store?
- How well does the Gateway meet PCI compliance standards?
- Will an out-of-the-box Magento payment gateway be adequate, or do you need the extra capabilities offered by custom solutions such as Stripe, iPay, or Amazon payments?
- Do you sell products or services internationally? If so, your gateway must support the countries you trade with and the currencies used by your customers.
If you spend a little time focusing on these considerations, you should have little difficulty finding a Magento payment gateway to suit your business, market, and customer base. Nevertheless, it helps to get some insight from ecommerce developers into which gateways enjoy the greatest popularity and why.
Top Magento Payment Gateways to Evaluate
PayPal and Braintree are two well-known and trusted payment gateways, which also happen to be the two that Magento recommends by default. PayPal of course, has a huge share of the payment processing market (as illustrated in the chart below), handling more than $130 billion in ecommerce payments in 2017, according to Statista.
Incidentally, PayPal also owns Braintree, but there are differences in the two gateways, so it is worth evaluating each of them—or you might choose to set them both up as Magento payment gateways.
Along with Braintree and PayPal, the following payment gateways can integrate with Magento, and are all associated with high performance, robust security, and positive consumer sentiment—hence their high rates of adoption among ecommerce businesses:
- Amazon Payments
- Sage Pay
- Google Checkout
To integrate any of these payment gateways into your Magento store, you simply need to locate and download the appropriate extension. Many payment gateway extensions can be found at the Magento Marketplace. A lot of them are free, but some, particularly those with advanced security features, come with a price tag.
The Pros and Cons of Multiple Magento Payment Gateways
If you decide—as many enterprises do—that a single payment gateway is insufficient for your Magento store, it’s not at all difficult to set up multiple gateways. In fact, there are some very good business reasons to do so.
Nevertheless, before you draw up a list of the gateways you plan to work with, you should know that there are downsides to such a decision. We will explore those in a moment, but first, here are some reasons why many merchants do choose multiple payment gateways.
1) International market coverage: You may plan to enter foreign markets that are not supported by your first choice in payment gateways. If so, a second or even a third gateway may be necessary for you to accept payments in all the currencies and from all the countries that you want.
2) Solution availability: If you have your online store integrated with two or more Magento payment gateways, you and your customers have some protection in case one of those gateways fails.
3) Customer satisfaction: Amid mounting concern about cybercrime and data security, shoppers are increasingly growing to understand payment gateways and some consumers have their favorites. By integrating multiple gateways into your Magento sales platform, you may reduce the risk of losing sales, because yes, people do care enough to shop elsewhere if you don’t satisfy their payment.
The aforementioned benefits might make multiple payment gateways seem like a no-brainer, especially given the freedom Magento offers with its integration flexibility. Negative effects do exist though, prompting some merchants to opt for a solo payment gateway. Here are two examples you may wish to weigh-up:
- Less opportunity for volume discounts: Dividing your sales volume among multiple providers can make it harder to qualify for volume discounts with each gateway provider. While this might not present an issue for larger enterprises, it may be something to consider if your business is new or just moving into a growth phase.
- Increased management/administration: This drawback of multiple gateways can affect payment-system integrity if you’re not very careful. As employees join or leave your business, for instance, you will need to be meticulous about user-account creation and closure for each gateway. Naturally, things like this are easier to keep track of with a single gateway and overlooking them can be disastrous. It doesn’t take much imagination to see the risk posed by a user-account that remains open after an employee leaves your company.
Fortifying your Magento Payment Gateway
As you probably know, PCI compliance is an essential element of security in your Magento ecommerce operation, and one that many of your customers will also have in mind. However, with so many different payment gateways available, some inevitably offer greater PCI compliance than others do.
Fortunately, the majority of popular Magento payment gateways, like those mentioned earlier in this article, offer high levels of security, but if you want to rest easier over gateway integrity, you may wish to take some extra measures.
Secure Payment Bridge
If your store operates on Magento Enterprise Edition, you can choose to have Magento’s own Secure Payment Bridge installed. The payment bridge is essentially a separate server that separates your online store from your payment gateways. It ensures that credit card data never touches your Magento store, hence minimizing the risk of illicit data capture.
As an alternative to Secure Payment Bridge, you might choose an option offered by some payment gateways, known as hosted order posting (HOP). HOP also keeps payment data outside of your Magento site, instead of displaying an iForm on your checkout page for customers to provide payment details. This allows captured data to be entered directly into the payment gateway’s server.
HOP integration will require the skills of an in-house developer if you have one, or perhaps some help from an ecommerce development company. It also reduces the flexibility you have over the design of your checkout page, so the added security comes at a price.
Silent Order Post
Conclusion: Payment Gateways and Magento Ecommerce Success
In this article, we have explored some of the elements making payment gateways so important to Magento users. Ultimately though, all these elements (security, shoppers’ preferences, and payment process performance) boil down to one critical factor in ecommerce success—consumer confidence.
That one factor matters a lot of course, and nothing shakes a consumer’s confidence more than online shopping security fears. Indeed, in a study by cyber-security company SiteLock, 52% of online shoppers said their confidence depends on their perception of payment security.
Security concerns aside though, your customers also care about countries and currencies, their favorite payment methods, and how well your payment processes perform on their chosen devices—all of which ride on your knowledge of Magento payment gateways, and how well you use that knowledge to make the right selections, decisions, and choices.
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