How to build your own payment gateway from scratch: 5-step guide

The key to a successful product is taking care of clients’ needs and expectations. That’s why these simple steps can play a huge role in your development process. Besides, fintech innovations happen too often to let you stop enhancing your platform. We provide companies with senior tech talent and product development expertise to build world-class software. Similarly, EPAM helped the CitiGroup build an innovative, customized, and transformative banking experience called CitiConcierge.

As a general rule, however, if building a website or web application, PHP or Ruby on Rails might be a good choice. Java or Swift might be a better-suited alternative for a mobile application. Injecting your payment platform with features to support financial processes, such as settlements, account balances and payout features will multiply the value of your custom solution. You want to smoothly and cost-effectively integrate a payment gateway with your Net Developer job description Workable existing software (e.g., an ecommerce website, a customer portal, a mobile banking app, an accounting system). A payment gateway integrates with an accounting system to instantly transfer data on the successful payments and receive triggers to timely charge due payments (e.g., recurring payments). Additionally, the solution may be connected to a data analytics system to share relevant data required to analyze cash inflow and customer payment behavior.

Payment processing and Payment Gateway Development Services

So, think carefully about whether you prefer an internal or external checkout page. Also, remember that add-ons and side themes require your attention too. Reducing the threats and restricting your liability is possible through implementing a hosted payment gateway. Once a merchant’s application redirects to it, no safe data passes through the user’s cart.

• These payments are processed via a payment gateway which is developed by a payment service provider.
• CyberCraft was able to address our needs in a short period of time and on the budget.
• Innovation and smart functionalities help platforms rise to the top and become successful.
• It also allows for convenient and secure recurring charges, for the payment details are stored as a token.
• In 2021, the global payment gateway market size was valued at $22.09 billion USD, and is expected to expand at a compound annual growth rate (CAGR) of 22.1% from 2022 to 20301.
• A payment gateway is a technology standing behind card payments authorization and payment processing, which supports purchases in online stores.
• Use advanced verification systems to authenticate users’ identities before they can use your gateway to make transactions.
• Our payment processing software incorporates the latest encryption and compliance standards, such as PCI DSS, as data is processed.

Once a user visits a website and places an order, the website owner sees it in the system. The website redirects the user to the payment gateway page, where they can choose the payment method and complete the payment (if https://g-markets.net/software-development/what-is-a-cloud-engineer-and-how-do-you-become-one/ the user cancels, they are redirected to the cancel URL). When the payment is made, the website redirects the user to the Thank you page while the website owner waits for the payment gateway to notify the callback URL.

Personalization in banking

ScienceSoft defines the techs and tools required to build an online payment gateway and integrate it with relevant corporate solutions and external systems. Where your payment gateway resides is a big deal in terms of how your customers experience your website. Hosted payment gateways send your customers to an alternate platform to enter their credit card information.

That is why governments worldwide have mandated payment gateways with robust security measures. It can get very expensive to create your own payment gateway system from scratch. However, opting for a custom platform will provide you with the solutions that you require without breaking the bank. So, if you were to invest in a custom platform rather than a newly developed platform, then you’ll be investing in a long-term product that is optimized to meet your specific business needs.

How much does it cost to create a payment gateway?

This is just the tip of the iceberg, as your full feature list will depend on your project specifics. Still, these are the must-have features of an efficient payment solution. Instead of relying on legacy software that runs on a monolithic architecture, build a new system that relies on several microservices to function. By doing so, you can scale your system architecture as your user pool expands. Doing the bare minimum when building a payment system will keep you stuck at the bottom of the barrel. Instead of only adding core features, use advanced tools to attract a new audience to your gateway solution.

If you need a quick time to market, you might aim for creating a simpler system or use an already existing payment gateway. However, it is important to keep in mind that even with your own gateway, you will still need to pay access fees, interchange fees, and more. The difference between using your own payment gateway and a third-party gateway is about 20 cents, so if you have a huge volume of clients, it may be worth it to build your own.

By implementing 2FA or MFA, payment gateways can add an extra layer of security, making it more difficult for unauthorized users to access sensitive data and systems. Interchange and settlement costs can only be eliminated with direct integrations with card network providers. This level of integration really only makes sense if your company processes very large transaction volumes, such as into the billions. Local regulations for the region or regions that you wish to do business in will also weigh on the choice of technology for your payment gateway. However, this belief is misguided; the first thing you will need to do is build business relationships with either a payment processor or an acquiring bank. Once the card issuer has authorized the transaction, the payment gateway sends the response back to the merchant’s website, and the transaction is completed.

EuroPay, MasterCard, and VISA are three payment systems that stand for this abbreviation. The idea is to avoid card-related fraud by exchanging various data between the card and the POS terminal thanks to the special inserted chip tech. Checking all requirements for your country of residence is not enough in case your payment gateway operates in more than one country. The one who is liable by financial authorities is a merchant of record (MoR) – it is up to them to trigger a user’s payment. The selling party should move their fund partially to the marketplace as a fee.