Thanks to the internet, protocols, networks, Reuters, and the World Wide Web (www), the world is becoming smaller and smaller. Come to think of it, what is actually making the world grow smaller? Information, I guess. Access to more information increases by the minute. Piece of information that would have ordinarily taken months to get are now available with a click. Transactions that could have taken weeks in the time past now takes place in seconds.
The more information we have, the easier it is to buy and sell online especially via mobile devices. Ecommerce (buying and selling online) may not have gone this far if mobile devices and apps have not come to the mainstream.
The cyber space is now open to anyone to transact businesses. The opportunity to sell services and products online now is very robust and continues to grow. To encourage more and more startups and small businesses to start selling online, it is advisable to demystify ecommerce. I believe it is worth your time to learn the core components of buying and selling online, maybe as a startup, speedup or SME.
These are the basic things you should keep in mind as you plan to start selling to the online community. After reading and understanding this piece, you will be able to differentiate between payment gateway, payment processor and merchant account.
What is Payment Gateway?
Similar to POS used at shops and offices, payment gateway is a window through which you take payment for your stock online. Gateway allows you to charge credit/debit cards for goods or services sold on your website. As a matter of security recommendation, you are not allowed to directly transfer transaction details from your website to a payment processor.
Thus, payment gateway is an e-commerce application service provider service that authorizes credit card payments for e-businesses, online retailers, bricks and clicks, or traditional brick and mortar.
One of the important decisions you will make when migrating your startup business online is choosing your payment gateway. You could choose to have as many payment gateways as possible on your website. But you will have to pay for integrating each of them into your online shop. However, with VoguePay, you do not have to integrate and pay individual payment gateways. VoguePay aggregates many local and international payment gateways for your convenience and ease of use.
It is a gateway that authorizes the acquiring bank to charge the card provided for payment. It is through gateways that your business communicates with your client’s banks to either approve or decline pending transactions. Security is very vital with gateways, as their major role is to ensure that personal and financial information provided by clients who want to pay via your website are properly secured.
Payment gateways charge both merchants and the banks either a monthly fee or percentage of the transaction amount.
What is Payment Processor?
Payment processors are the financial tech institutions that work in the background to provide all the payment processing services used by an online merchant. VoguePay is Africa’s biggest payment processor. VoguePay provides you with free merchant account which you could effortlessly set-up and verify. Even before your account is verified, you could start transacting with other VoguePay users.
If you have a registered your business with CAC already, verifying your account to facilitate transactions with non-VoguePay merchants is easy and prompt. With as low as N1,500, you will have a payment processing account setup and verified. Isn’t that enough reason for you to smile?
What is a Merchant Account?
Merchant account is the account you will open with a payment processor. It is on your merchant account that the payment processor facilitate your debit and credit before your bank account is hit. Merchant accounts have different features based on the payment processor.
VoguePay has Flexible Account Management, Accept payment without a website, free technical tools, Recurring transfers, Track and audit all transactions and communications, Currency Control, Customisable Notifications, Bulk and Batch payments, free mobile phone applications, Highly Competitive charges, multiple payment channels.
What makes ecommerce tick?
Now that you can differentiate between payment gateway, payment processor and merchant account. You have information good enough to decide who to work with when you want to start selling online. Beyond just setting up your business online, you should keep an eye on your potential customers in decisions you make. If you intend to take payment from customers abroad, make payment in foreign currencies or plan to receive payment in currencies other than Naira, you should sign up with payment processor that has a tested and trusted international gateway.
The success of your online business will be limited if your potential customers have difficulty paying you because you don’t have provision for their preferred form of payment. That is another reason VoguePay makes the best option for payment processing.
VoguePay’s global coverage allows consumers and businesses to safely make and receive payments in all major currencies, regardless of location. VoguePay was created with a vision to make online, cross-currency payments and transactions safer, cheaper and more accessible for businesses, traders and consumers in Africa and internationally.