Most online, mail order or telephone order businesses need a payment gateway. These are an intermediary between your shopping cart and the financial networks who are involved in the transaction. It is an EFTPOS terminal that is in cyberspace that checks the validity of the card, encrypts transaction details along with ensuring that information is transmitted to the right financial organizations and then translates the responses that come back to your shopping cart. The data is transmitted to the gateway thru the shopping cart and the SSL connection. Your customer is never interacting with the gateway personally but instead via the plugins the shopping card is configured with in a format that is able to be read by that specific gateway.

Choosing the right payment gateway, along with your merchant account provider, is vital to the success or failure to your online business. You should choose your gateway the same way as you chose your merchant account provider. Research and shop around to compare rates and ensure you know the regulations and policies of the gateway provider. Your gateway should be compatible with your merchant account provider as well as offering AVS protection. The shopping cart package you use should be compatible with the payment gateway as well. If it is not listed, check with the software company to see if they will accept the gateway. This is usually no problem if there is a demand for it. There should be no extra charge for this support.

Ensure that the gateway offers good pricing without storefront software limits. This can cost more for setting up credit card processing than you first expected. It should also use an Address Verification System or AVS. This reduces the risk of fraud by verifying the billing information with that of the cardholder’s information on record with the issuer. You can only be 100% sure of this via a cash register terminal but AVS is the next best thing. This is a necessity for high risk merchant account holders who could benefit from the reduced fees that are charged by the merchant account provider. Your research could save you time, money and many headaches.