What does it mean to be a payment gateway?

Ariel 22 2023-04-13

Then, as the payment

Let's start with the definition of a gateway when it comes tosaas payment gateway payment gateways. A gateway's role is to establish a communication link between networks, which includes two basic functions: inter-network connection and protocol conversion. Similarly, the payment board in the merchant business system establishes a link between the merchant business system and the bank payment system, which serves a similar function and can be viewed as a gateway. As a result, the payment gateway design we'll be discussing today is actually the payment board design of the merchant business system.

The origin of the payment gateway

Merchants supported a bank by docking to a system interface provided by that bank when electronic payment was not yet popular. Then, as the payment industry evolves, merchants are no longer satisfied with supporting only one or two banks in the payment process. At this point, the merchant's payment system must simultaneously interface with multiple banks and deal with many of the resulting derivative issues, such as reconciliation and clearing. The labor and time required to develop such a system are also prohibitively expensive for merchants.

Third-party payment institutions were born at this point to develop and operate a system to replace the merchant in order to achieve the function of interfacing with multiple banking systems at the same time, and then to provide a unified interface for merchants to use. At this point, the payment gateway is the system of the third-party payment institution. It not only serves as a link between the merchant's business system and the bank's system, but it also performs a variety of basic payment business functions such as order management, channel management, risk control management, routing configuration, billing management, clearing management, merchant management, and user management.

With the advancement of online payment, there are an increasing number of third-party payment institutions, and the problem merchants must now solve is not how to access multiple banks, but how to access multiple payment institutions. The merchant's demand for payment systems has also changed at this time, and the gateway has moved forward, putting higher demands on the merchant's payment system. An aggregated payment service provider, such as Ping++, is now willing to implement similar functions for merchants.

The difference between a payment gateway and a traditional payment gateway at this point, from the merchant's perspective, is that there are fewer points of concern, and the merchant only needs to focus on orders, channels, risk control, account management, and routing configuration. To demonstrate the flow of an order between the aforementioned modules, I use an outbound free-travel trip. An order is typically processed in four stages: order creation, message signing, payment routing, and result confirmation. We also included merchant entry for a more complete package.

 

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