As businesses grow, finance teams often struggle to manage the added complexity and exponential increase in the volume of invoices. When teams lack access to a solution to help streamline these tasks, errors creep in and bottlenecks form, resulting in decreased efficiency and more customer churn.
Payment gateways are vital to helping finance teams process e-commerce transactions securely. That’s why it’s critical to develop an understanding of how they work and what sets one apart from the others.
How do payment gateways work?
Payment gateways follow a five-step approach to help process transactions:
- The payment portal accepts customer information.
- The payment gateway encrypts the data and connection between the payment portal, gateway, and processor.
- The payment processor receives a transaction authorization request from the payment gateway.
- The credit card company authorizes the transaction request after verifying credit availability.
- The payment can now be fulfilled, and funds are transferred to the merchant account.
For more information on payment gateways, including an overview of the different types and an explanation of what happens if a payment fails, check out