What is an Online Payment Gateway and How Does it Work? Online payment gateway is the process of every online E-commerce platform. Payment gateways are software and server that transmit transaction information to acquiring and response from issuing bank.

What is online Payment gateway and How Does it works

Every online e-commerce platform improves service with online payment gateway which depends on customer account detail and authorized banks. All the e-commerce platform authorized for e-business, an online retailer, and mortar businesses because the payment gateway is encrypted sensitive information such as credit card or debit card number ensure that information securely passes between customer and merchant.

How Does Payment Gateway Work

A payment gateway provides an information between payment portal and front-end processor of acquiring a bank.

A.- Customer places an order on the website with the help of “Place order”Perhaps using their card detail using an automatic answering service.

B.- The user or customer web browser encrypted the information to be sent between the browser and merchant web browser server with secure service layer encryption.

C.- Merchant forwards the transaction detail to their payment gateway that is another SSL encryption.

D.- The payment gateway forwards the information about the transaction information to the payment processor card ( Master, Visa, Discover etc) by the merchant acquiring bank.

E.- The bank takes an authorization to the bank to encrypt the credit card issuing bank authorization request and send to with response code, then the payment gateway takes the response and the processor forward to response to the payment gateway.

F.- The acquiring bank submits all approved authorized in a batch via a settlement processor.

G.- Acquiring bank deposit approved fund in the merchant nominated account.

Features of Payment Gateway

  • Multiple login option platform with an authentication layer
  • PCI (compliance)
  • Integrated payment processor
  • SSL certificate
  • Security seal and credit card logos
  • Checkout button
  • Visual Checkout process
  • Return and refund policy
  • Order confirmation after checkout
  • Confirmation email


All the payment gateway are based on the encrypted key and one-time password to provide a safe and secure connection between e-commerce platform and user account detail information. At present time all companies provide own payment gateway, third-party authentication payment gateway services to make a service reliable for the customer to get fast services.

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