Payment Gateway Providers: Pros and Cons

Payment gateways are one of the most crucial parts of any mobile app that sells goods or services. Whether you are in apparel selling, candle selling, car selling, etc. business or offer legal consultation, human resource consultation, policy-making expertise (or any other service of that sort); or are planning to build your business online with a mobile app or a website—you need a way to ensure payment processing is fast, secure and accessible. 

Building the complete backend logic for payments is a challenging task. Fortunately, businesses now don’t need to reinvent the wheel. There are pretty good payment gateway providers that offer API, which your developers or mobile app development agency can easily integrate. And within a few hours, your business is ready to accept payments across the globe.

What is a Payment Gateway as SaaS?

A Payment Gateway is a consumer-side payment interface technology that essentially is Software as a Service (Saas) that collects customers’ payment information and allows them to pay for the availed goods and services. In a brick and mortar stores, this may include making payments using QR codes or Near Field Communication (NFC), whereas, in online mode, payment gateways are essentially checkout portals where the buyer enters their payment credentials to make the payment.

Payment Gateways SaaS APIs are a part of the electronic payment processing system, which is integrated with your backend server. It renders an interface where the customer data is entered and then sent to the merchant bank, which is connected to the sellers’ backend server via an API. It does not matter whether your backend was developed by an in-house mobile app developer from scratch or you prefer to use Mobile Backend as a Service (MBaaS) – third-party payment solutions can be easily integrated with your digital product.

Payment Gateway Providers for your eCommerce Mobile Apps, Charity Organizations, Digital Invoices, Crowdfunding, and much more.

Stripe

Stripe offers payment processing APIs that enable developers to integrate its mobile payment gateway processing services into mobile apps. Stripe is used and appreciated by buyers and sellers globally to manage their finance online.

Pros 👍

• Easy to use: Stripe API renders ease of use, especially when it comes to its credit card processor. Developers with minimum experience can integrate Stripe API without any technical difficulty.

• Compatibility: Stripe offers extreme compatibility with a variety of operating systems such as Linus, MacOS, Microsoft, iOS, Android, etc. Not only this, but it also offers seamless integration with multiple eCommerce plug-ins like Drupal, Magento, PrestaShop, WooCommerce, WordPress, and Shopware.

• API Testing: Before developers launch the Stripe API, they can test how the Stripe mobile payment gateway integration will function with its in-built bug-free testing environment.It provides developers with numerous mock credit card numbers to run tests and gives developers the flexibility of switching between the production mode and testing mode.

Cons👎

• Geographical Limitations: With Stripe API, businesses can process payments from across the globe. However, it only provides its services to businesses in just 44 countries. Moreover, some of its features are not available in some of the regions.

Amazon Pay

Amazon Pay has become a popular choice of many eCommerce mobile app platforms and is slowly entering other industries as well. Its services are already being used by companies such as Lenovo and Canon. In fact, the launch of Amazon Pay has come as a replacement for Simple Pay and Checkout—other payment services of Amazon.

Pros 👍

• Fraud Protection Technologies: Amazon Pay uses the same technology against fraud detection as Amazon.com. The fraud detector automated the detection of potential frauds using machine learning models, which are fed prospective fraud patterns.Another great policy, which is worth mentioning here, is that the payment gateway does not hold the merchant liable for any fraud-related chargeback (if they have fulfilled all the policy requirements).

• Data Range Report: Amazon Pay enables merchant accounts to generate data reports as per their preferred custom time range. This feature also has the feature to generate separate reports of the transactions which have been settled and which have not yet been settled. Merchants can even generate reports on a daily basis.

Cons👎

• Integration: Even though Amazon Pay is gradually gaining traction for its mobile payment gateway solutions, it has not yet partnered with major eCommerce platforms such as Squarespace, Square Online, and Wix

• No Volume Discounts: Amazon Pay doesn’t offer merchants availing of its mobile payment gateway integration services who sell goods and services at high volumes. On the other hand, Stripe and other payment gateway services offer volume discounts to merchants who sell at huge volumes.

PayPal

PayPal is one of the oldest and most widely trusted payment solution providers for businesses’ mobile apps.

Pros 👍

• Multiple Financing Options: PayPal provides loan facilities to its merchant accounts so that they never run low in terms of funds to expand their business. In fact, in order to promote the sales of their merchants, they offer the ‘buy now pay later’ option to their customers. For small businesses—that have been in business for at least nine months and have generated at least $42,000 of revenue, it offers loans from $5,000 to $500,000.

• Merchant Support Solutions: PayPal is continuously evolving as it aims to provide merchant services beyond mobile payments processing so that businesses can streamline their business processes—such as invoicing, recordkeeping, tax computations, marketing, and shipping— on a single platform.

Cons👎

• Expensive International Payments: PayPal may prove an expensive payment process solution, especially if you are a small business owner and are conducting international transactions. It is because they charge a premium of 1.5% along with additional charity donations per transaction while accepting international payments. In fact, they also charge 3%-4% on top of the currency exchange rate. Thus, becoming an extremely pricey option.

Authorize.net

Authorize.net is a reliable, fast, and secure payment gateway integration option for mobile apps. Its functioning is similar to how a card payment is processed but in an online setting.

Pros 👍

• Customer Profile Management: This is one of the most exclusive features of the Authorize.net payment gateway. It manages customer profiles in its merchant account interface and allows customers to save their billing, payment, and shipping information.In fact, the card user information is updated monthly, which helps in avoiding unwanted payment declines and interruptions. The merchant can also visualize this information in the form of a summary report using Authorize.net API.

• Automatic Payment Option: With its Customer Profile Management system, it saves sensitive customer information on its secure servers in compliance with payment card industry standards. This helps in processing recurring customer bills faster and removes the need to enter payment details from scratch for every transaction.

Cons👎

• No Free Trial: Unlike other payment solution APIs, Authorize.net does not offer a free trial period for its prospective merchant account/s. This might prove to be a great disadvantage as merchants are more likely to trust and buy the product after they have tried it in real-time settings.

Square

Square is one of the most widely used payment solutions across the industry. One of the main reasons for this is that it provides both easy-to-use hardware and software payment solutions.

Pros 👍

• Seamless Online and Offline Integration: Since Square is the leading payment solution provider, both online and offline, it also offers businesses seamless integration of Square POS (offline and in-store) and Square Online (online store). So that it acts as a single unified payment system.

• Social Commerce: Square features make your online business easily discoverable on Google Search. It also avoids any third-party commissions.It also allows merchants to create shoppable posts or online shops on Facebook and Instagram by syncing them with your Square library.

Cons👎

• Limited Use: One of the biggest disadvantages of using the Square payment gateway solution is that only the merchants who are already using Square POS (offline and in-store) can avail of online payment gateway services.

Implementation of a payment gateway solution that seamlessly integrates with your web and mobile app is an extremely crucial decision. The experience it renders is also a significant contributing factor to how the merchant-customer relationship will evolve.

In this blog, we have discussed global payment providers. This doesn’t mean there are no good regional alternatives. We listen and help our clients to integrate the best SaaS products to alleviate the customer experience. Share your app idea, and let us do what we do best.