Over the last few years, the eCommerce industry has seen booming growth. More and more brands are taking their businesses online rather than setting up their brick-and-mortar stores. Interestingly, consumers are turning towards digitalization and accepting the change mainly because they have reliable online payment methods. Payment gateways are highly efficient in terms of transaction speed, privacy, and security. However, there are still some misconceptions regarding the payment gateway charges that need to be cleared.
For those who don’t know, there is a small amount of charge every merchant has to give their gateway service and this charge is known as the payment gateway charge. This article is all about busting the common myths around these minimal charges, so let’s begin!
What Are Payment Gateway Charges?
Before bursting the misconceptions, first, it’s important to know what exactly these gateway charges mean.
The online payment gateways single-handedly handle a series of processing formalities to help their customers make transactions with a few clicks. Basically, they act as a bridge between the merchants and their customers’ banks by acquiring banking information from both parties and registering on their respective portals.
To avail of these highly convenient services of payment gateways, merchants have to pay a small fee known as the payment gateway charges. Note that this amount is charged by each and every payment gateway service, so there is absolutely no room for any doubt.
So, this is what a payment gateway charge exactly is. Now, let’s move on and clear all the doubts and myths around these charges. This information will help you select the right payment gateway service for your business with much ease.
1. Payment Gateway Charges Are Similar To Mobile Banking Charges
No, payment gateway charges are nowhere similar to the net banking or mobile banking charges demanded by the banks. Understand that payment gateways are not the representatives of any bank, neither they use the same platform. Instead, they act as a reliable and safe interface between the banks and the user with an aim to provide a faster and frictionless transaction experience.
2. Debit and Credit Cards Have Similar Charges
Debit and credit cards have different charges associated with them and most payment gateways have their fixed rates for different types of credit cards and debit cards. These charges vary on the basis of card types, card providers as well as risk factors. In fact, risk factors are the main reason why most services charge extra on credit cards.
3.Online Payment Gateways Hold Prospect’s Money
No, payment gateway services don’t hold any kind of money from their prospects which can either be merchants or consumers. Their only job is to help the transactions by securing the banking information of their clients and coordinating with the banks. Thus, when a user enters his banking details, the payment gateway immediately sends a transaction request to the bank by forwarding this information to the bank. Next, the banks acknowledge this request and complete the transaction. Payment gateways are the mediators that facilitate the entire process.
4. Payment Gateways Charge Same Prices For Same Services
If two businesses are offering the same services doesn’t always mean they have to pay the same charges, vice-versa is also not true. So, before selecting your payment gateway service provider, check their features including user interface, the underlying technology, mobile responsiveness, etc. The best payment gateway provider will have all of these qualities.
5. All Payment Gateways Charge The Same Amount
Another misconception regarding the payment gateway charges is that all services charge the same rates. Some companies even use this misconception as to their selling point. But as a responsible consumer, it’s the duty of merchants to identify and understand the price differences. Everything regarding the rates should be made clear before accepting the quotes.
6. Payment Gateways With Low Charges Are The Best
Most merchants believe that the payment gateway services that offer the least rates are the best. But unfortunately, they’re not!
It is very important to understand that payment gateways are technology-centric. They use advanced software, tech tools, and servers to make their portal more secure and efficient, and this requires money. So, if some service provider is luring you by the cheap rates, it is more likely to provide you cheap quality service as well. Hence, be aware and don’t fall for the cheap payment gateway charges. Rather than looking at the rates, pay attention to their features and then make sure that the charges they’re demanding are worth it or not.
7. Payment Gateways Are Fraudulent
The chances of payment gateways being fraudulent are very rare. But there are merchants, especially the newcomers in the industry shy away from taking the services of online payment gateways out of fear. So, a good idea is to look for a trusted service provider and enquire about them thoroughly before making any final decision.
These were a few most common misconceptions regarding the payment gateway charges. Remember, these myths have nothing to do with reality. Payment gateways are highly reliable, secure, and safe. The charges they demand are totally justified for the seamless transaction experience they provide.