Setting up Payment Gateways: Best Practices
Published: 2019-09-23 14:23:23

According to <a href="https://www.alliedmarketresearch.com/mobile-payments-market">Allied Market Research</a>, mobile payment transactions globally will stand at more than £3.5 trillion by 2023, with a growth of 33.8% CAGR between 2017-2023. <a href="https://worldpay.globalpaymentsreport.com/#/">Worldpay’s 2018 Global Payment Report</a> states that the use of mobile payments is going to be the most commonly used payment method after debit cards by 2022.

Needless to say, mobile payment is an indispensable part of all e-commerce. If any app intends to sell anything, it cannot do without a secure and efficient mobile wallet and payment gateway. 

This article will outline certain best practices that you must keep in mind when setting up mobile wallets and payment gateways for a mobile app. 

<b>What exactly is a payment gateway?</b>

A <b>payment gateway</b> is used to make financial transactions possible by enabling the transfer of data between a device and a financial institution. Payment gateways are indispensable for e-commerce ventures - for anything to be bought and sold online, you need a payment gateway. 

Essentially, these gateways allow businesses to verify customer data. They also support major financial services like MasterCard and Visa, thus facilitating easy payment. 

<b>Best practices for adding mobile payments to your app</b>

In order to facilitate secure and successful payments on your app, you must know how the process actually works. 

A payment gateway is essentially an API you use to charge a customer’s payment mechanism (card, net-banking, etc.). When a customer on an e-commerce portal puts a product in their cart, it gets linked with the payment gateway. After the card processor receives the request, the payment gets approval. Then, information is displayed in the merchant account. The money reaches the merchant account in a few days. 


This two-part process provides added security. Transferring credit card information directly to the processor can be risky if someone intercepts the traffic. Anyone with the necessary skill can get the card number and access the processing merchant account, which means they would be able to make transactions with stolen credentials. 

Now that you know how mobile payments work, here are a few tactics that will help keep mobile payments fast and secure for customers of any mobile app:

<b>Planning according to customer</b>: Is your app one that customers download? Or is it meant for businesses? Are you looking to sell your app directly to users, or is it meant to help another company process customer payments?

For the first one, e-commerce transactions are easier to manage since your app will have control over which payment service provider and transaction process to use. The latter might require you to offer offline payments (if the company wants that) or even invoice-based billing or online bill pay. Knowing what the customer wants helps you decide what account structure to use and what risks to expect. 

<b>Planning according to product</b>: There are different methods for selling different products. With physical products, setting up a trade is simple enough. But with digital content, Google Play Store and App Store do not allow third-party e-commerce services for applications downloaded from their database. In that case, it is imperative that you ensure that your apps use platform-appropriate user accounts to make payments (Apple or Gmail). Once done, connect a payment gateway to initiate and execute online transactions. 

Business tactics can also affect the technical aspects of setting up payment. For example, if you are looking to boost purchases by loyal customers through discounts, you will need to program additional options into your online payment structure such as loyalty functions and promotions. 

<b>Security</b>: When it comes to handling money security is king. According to Wendell Adams, CEO of AB Mobile Apps, “If you're trying to accept a payment, and it's not through a secure way, and it winds up getting hacked, you're liable.” If your payment mechanism has any flaws that lead to leaks of hacking of customer data, it will damage your reputation irreparably. Conversations around data security are at the forefront of everyone’s mind, and flawless security is non-negotiable for the success of any app. 

To establish that your app is capable of handling customers’ banking data, you have to buy a PCI DSS compliance certificate. Even if you are using highly trusted gateway providers like Braintree or PayPal, you still have to acquire the certificate through a complicated two-step process. 
First, you’ll have to create an information system that stores users’ financial data in accordance with the PCI DSS standard.

First, prepare an information system that stores user card data so that it fully meets all the requirements of the PCI DSS standard. Put it through rigorous verification by independent testers, and use their recommendations to fix vulnerabilities. After that, your company will have to go through a comprehensive audit by a certified PCI Security Standards Council company that has the status of a Qualified Security Assessor. If the auditor agrees, you will be issued the appropriate certificate.

<b>Own platform or third-party service</b>: Depending on your business needs, the technical needs will change. Generally, it is easier for developers to link third-party mobile commerce platforms to their apps. It is more cost-effective since the app’s parent company does not have to deal with the cost of maintaining and updating the payment gateway. 

Of course, certain enterprises may choose to construct and maintain their own payment gateways since that gives them greater control over the entire transaction. It can also help them secure customer data more reliably. However, the cost of maintaining such a structure (including additional developers, security experts, and specialized personnel) can be intimidating, unless it is justified by a high volume of mobile sales. 

If you do end up choosing a third-party platform, make sure you do some extensive research into their offerings. In particular, keep an eye on currency conversions fee rates if you are planning to take your app to a global customer base. 

The strategies mentioned above will help you navigate your way through the morass of payment gateway integration. However, you have to remember that the technical strategies governing any app are determined, to a large extent, by the business model it fits into. It doesn’t matter if you are a developer, you should have significant clarity on what your app intends to achieve both financially and technically. In terms of payment gateway setup, this is doubly important. 

Testing your payment gateway for security flaws must be imperative to your entire <a href="https://www.browserstack.com/app-live">mobile app testing</a> ecosystem. Make sure that your QA team runs through payment processes with a fine-tooth comb, since unbreachable financial and data security is the foundation for any app that wants to make a mark in the digital landscape.