Understanding an Ecommerce Gateway

An Ecommerce gateway is necessary to make online financial transactions. To close an online deal one has to forward a bill to the client and receive payment from the client. The client pays by keying in his credit card number, which is verified by the bank who issued the credit card. The website of the bank is connected and the client's credit card number is verified. Then the payment amount is debited from the client's account to the seller's account, which may be in a different bank. Therefore, the seller's bank website opens and the money is transferred to the seller's account. Thereafter, the seller's bank website and the buyer's bank website both close.

The buyer's gets a confirmation saying that the transaction was successful. The buyer may reside in another country than the seller and so the transaction comprises of transfer of foreign exchange, which is subject to the rules and regulations of the seller's country. All this takes place in a 128-bit encrypted, and password protected secured environment within few seconds.

This is possible because there is another website which acts as an intermediary and connects all the sites together, coordinates them, converts the foreign exchange and does it as per rules and very fast. This other site, which connects all the sites, is known as a payment gateway or an ecommerce gateway, by which online monetary transactions take place.

An ecommerce gateway

Many of those who surf the Internet will have come across the term, "ecommerce gateway". Have you stopped to find out what it means? Most of you probably have not because you were busy doing something else over the net during that time and did not want to stop your work. Ecommerce gateway is actually the ?gateway? from your site to the merchant account. This is the ?gate? through which processing of your payments is done, whether it is by credit card or any other form of payment. Ecommerce gateway is better known as the payment gateway, because it is closely related to payment.

Features of an ecommerce gateway

The ecommerce gateway will basically cover sale facilitating features like shopping carts, merchant accounts, web hosting and so on. Other less known services are also offered which depend upon the type of ecommerce done by the site:

* Virtual terminal - this is the place where a customer can place an order after using the ?help? or ?contact us? button to enquire about your product. Many people dislike the fact that they need to go back to the home page and again navigate to the item they are interested to buy. They would rather just place the order after their questions and/or concerns have been clarified.

* Fraud alert - this is something that most payment gateways have build within, just like a bank has an inbuilt alarm. Sometime this alarm gives false alarms, but most of the time, it is accurate. By using a good fraud prevention system, you save yourself and others from many problems. Many will include special features such as AVS or address verification system where the details given by a customer at registration time is checked for accuracy, matching the name mentioned on the credit card with that who received the goods, as well as the three digit number that the credit cards have on their backside for additional safety, etc.

* Recurring billing - this is something most gateways do for regular customers. By this process, you will need to key in your payment information only once on the site. After that every time you make another purchase, the site will recover your information and before checking it out with the customer for any change, it is processed. This saves the customer time and effort.

* Other types of payment- some gateways provide processing of e-checks though this method is really not very popular as it is slow and difficult to process.

An ecommerce gateway is essential for online survival.

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