All About Online Payment Gateway Market

A payment gateway can be software or hardware that enables financial transactions on your website. Payment processors, providers, and platforms are all similar concepts you can encounter. 

Although there is a difference between the formal meanings of these phrases, they all refer to essentially the same things in everyday use.

Simply put, payment gateway providers act as intermediaries between your business and your client’s bank accounts, processing and transferring customer payments and the associated information.

A rise in massive transaction data and widespread adoption of various forms of online payment processing—including credit & debit cards, net banking, and mobile wallets—are driving expansion in the payment gateway business. 

In addition, the rising acceptance and availability of high-speed Internet also contribute to the industry’s growth.

Increased e-commerce sales due to the time savings it provides and international expansion of the Internet are other key factors expected to contribute to the expansion of the payment gateway market. 

Furthermore, the market is expected to expand with more businesses and consumers using digital platforms that enable online money transfers.

This post will explain how the payment gateway market is changing, with different types of it being introduced worldwide.

Types of Payment Gateways

On-Site Gateways

With a self-hosted payment gateway, the complete financial exchange takes place on the gateway’s servers. 

For instance, Amazon employs the Amazon Pay transactional system. They handle the entire checkout and payment procedure themselves. 

The most notable benefit is the enhanced level of safety. While only the largest corporations can afford to develop their proprietary processing system, smaller enterprises are at a severe disadvantage.

Off-Site Gateways

The customer completes the checkout on your site, but the gateway provider handles the money processing. 

Payment for your product is collected from clients and remitted to you at a specified interval, much like the Stripe payment gateway. 

The service benefits businesses since the supplier guarantees to process payments and deal with any complications that may arise, such as customer disputes or refund requests.

Redirecting Gateways

A “redirect” occurs when the gateway sends the customer to a separate payment page to finish the transaction (processing and paying). The use of PayPal is an instance of redirection. For one thing, this platform results in more work for the client and less power for the retailer. 

A Redirect gateway, on the other hand, allows smaller venues to benefit from the reliability and safety of a larger one.

No special knowledge of payment gateways is required to sell online. However, mastering the fundamentals of the leading payment gateway providers is essential if you want to feel secure in your work.

Impact of COVID-19 On Payment Gateways 

Sales have increased despite the global spread of the COVID-19 epidemic. Several factors contribute to this, including the increased popularity of online shopping, digital payment methods, instant payment processing, and the displacement of cash transactions. 

For example, during the pandemic, there was a 15% to 22% rise in consumers who opted to shop online. Moreover, people’s reliance on mobile and internet services has grown due to the pandemic because it provides access to online payment systems and other digital hubs.

Deep Dive Into Regional Data

In 2021, more than 36.0% of global sales came from North America, making it the region’s most important market. The development of new technologies and the widespread adoption of payment gateways by successful end-use industries like retail and e-commerce are to thank for the expansion. 

Market expansion is being fueled in part by the presence of major competitors in the area, including PayPal Holdings Inc., Mastercard & Amazon Payments,

Oberlo predicted that retail sales in the United States would increase by 3% in 2021 and 4% in 2022.

Over the projection time frame, the Asia-Pacific market is anticipated to expand quickly. Several government attempts to develop online payment infrastructures in Asia-Pacific countries have contributed to the expansion.

The Reserve Bank of India has regulated gateways like Bharat Bill Pay, Paytm, and Mobikwik to facilitate efficient digital payments in India. 

In addition, the Chinese government is working on expanding access to the internet in less-populated areas, which should boost the economy and the market.

That’s all from the holistic view as far as the payment gateway market is concerned. If you want to learn more about what’s happening in the world of FinTech (Finance & Technology), read our blog to find out