International payment gateway
In today's world, international payment gateways are becoming increasingly crucial for businesses of all sizes. But with so many options available, knowing which one is right for your business can be challenging. In this article, we'll look at the different features to look for in payment gateways and learn how to choose the best one for your needs.
What is an international payment gateway?
Chances are, you already know that a payment gateway is a special software that allows businesses to accept online credit or debit card payments from customers.
Respectively, an international payment gateway is a technical solution allowing for authorising international card transactions. This tool is needed for businesses that work at several locations worldwide or have an online presence in more than one country to accept card transactions.
In other words, an international online payment gateway ensures a business can accept international payments from customers worldwide. The software lets companies receive money in their bank accounts without worrying about currency conversions or fraud protection.
A payment gateway connects your e-commerce website to your merchant account and allows you to process credit card payments online.
The primary purpose of using an international payment gateway is to allow customers to pay via their local currencies instead of converting them into your currency. The funds are then automatically converted and deposited into your merchant account. This way, you can support multiple currencies for different countries and charge your international customers accordingly.
To sum up, some of the most demanded characteristics of payment gateways for international transactions are the support for multiple currencies, compliance with the world's acknowledged security standards and regulations, global and local payment methods, and several languages.
How does an international payment gateway work?
There are three basic things a business needs to work with card transactions:
- Merchant account. It is a business bank account that the company gets to accept credit or debit card payments from customers.
- Payment processor. This solution allows merchants to process transactions and helps them to support different payment options.
- Payment gateway. It's software that businesses use to confirm customers' payment details and authorise card transactions.
These are a must for online card transaction processing. Today, many payment service providers offer all-in-one solutions, but still, there are many cases when businesses have to go for each point separately.
The payment gateway is the middleman between your website and your bank. It's responsible for allowing you to accept payments from your customers, online or in-store, via their preferred payment method.
- The first step in a multi-currency transaction is a customer's decision to make a payment. They head to the payment page on your site and get taken to the secure payment gateway.
- They're asked to enter their credit or debit card details and confirm the payment.
- The payment gateway sends your customer's card details to your nominated payment processing solution.
- Your bank analyses this information and determines which payment network the card details belong to. The payment gets routed to your customer's bank or credit card provider. These details and payment amounts get authorised, with fraud detection procedures taking place to ensure the payment request is legitimate. Once the payment is authorised, you and your customer should receive a notification that the payment is complete.
- The money is then settled into your nominated bank account.
What features should international payment gateway support?
It is vital for any business to choose the best international payment gateway provider and payment partner. The quality of a selected online international payment gateway will likely affect your conversion rates and your reputation. For example, in case of technical glitches in the payment process, the customer will think it's because of some problems on your side and may not want to return to your website after such cases. So, here are five main factors to consider when choosing a payment gateway for international transactions.
A decent selection of payment methods
As a merchant that already provides services to multiple markets worldwide or is just planning the international expansion, you should understand that when customers reach the payment page, they want to see the option they're used to paying with. And if it's not there, it may result in lost sales for you. That's why your payment success largely depends on the availability of payment methods on your website that your international payment gateway provider should support.
Besides supporting the top global card brands, popular mobile wallets, like Apple Pay and Google Pay, international bank transfers, and even cryptocurrency, are worth considering — for instance, Bitcoin, Ethereum, or Litecoin. But of course, you should select the final list of options based on your target audience, markets and what your company does.
A gateway for international merchants should allow for working with different currencies. Your website should also display prices in the currency of a customer to make the shopping experience more smooth for international customers. Some checkout solutions can automatically detect users' location and adapt accordingly, while others allow choosing currency manually.
As we've already touched on the user experience topic, checkout is the most critical customer-facing element of the payment process that directly affects clients' satisfaction and conversion rates.
Besides being secure and convenient, some of the market's advanced checkout solutions support personalisation features. For example, displaying payment methods that the client will likely use or have used the last time on the top of the list allows them to save payment information and pay instantly in one click.
The solution should also be integrated into your website correctly to avoid basic UX errors like shutting down due to misclick. UX writing matters, too — all the error messages should be clear enough so a customer can fix the issue if it's on their side.
Same as with the currency, customers want to use their language when shopping. Rare merchants need to speak all languages of the world, but for globally present companies, it's good to have local versions for the world's most spoken languages.
Reliability, security and compliance
Another vital thing in terms of payments and gateways is security. The service provider must comply with the industry's renowned security standards, like PCI DSS, protect and securely store clients' information per GDPR, and have all the hardware and software needed for fraud prevention, tokenisation, encryption, masking, data protection, etc.
Moreover, an important parameter to look at is a provider's health. Usually, reliable gateways have a status page, allowing customers to see if everything's fine on the gateway's side or if some issue occurred. Don't trust 100% uptime claims without seeing a status page.
Which international payment gateways should you choose?
Choosing the best international payment gateway solution is one of the most important decisions you can make as a business owner. The right solution will help you sell to a new market, increase revenue and reduce risk.
There are many questions to consider when choosing an international payment gateway. Here are some of the most important ones:
- What countries does it support? The first step in selecting an online payment gateway is deciding what countries you want to sell in. A suitable international payment processing services provider should allow you to accept payments in those countries. Knowing whether the international payment solution supports all major card networks and currencies in each country you want to transact in is essential.
- Can I use my existing POS system? Many businesses already have POS systems that work well for their local market but may not be equipped for international transactions or certain types of cards. In some cases, it may be possible to integrate your existing POS with the new international gateway; however, sometimes, it may require expensive upgrades.
- How can it help me reduce risks? Depending on the payment methods you want to support, the payment solution must offer relevant fraud prevention and risk mitigation tools.
- How does an online payment gateway maintain high authorisation rates? Payment can fail for many reasons, even if you have a good relationship with the card network. For example, it will be declined if your customer's linked credit card expires before they have time to update it on their account with you. Your gateway can send reminders saying, 'Please update your billing information by [date] so we can continue processing your orders' to avoid cases like this.
Which payment gateway is best for all countries?
When selecting the best international payment gateway solution for an e-commerce website, there is no one-size-fits-all answer. Each country has regulations and preferred payment types, which means the best payment gateway for one country may not be the best choice for another.
Some of the most popular international payment options include PayPal, Stripe, and Square. This can be proven by looking at the company websites and financial reports. For instance, PayPal had 392 million active user accounts worldwide as of the first quarter of 2021. Stripe processes hundreds of billions of dollars annually for businesses in 40 countries worldwide. In its turn, Square processed $112.3 billion in gross payment volume worldwide in 2020.
Still, it's essential to research the local payment preferences for each country you're targeting and select the best payment gateway that fits your customers' needs in that part of the world.
A weak point of international gateways & how to alleviate it
International payment gateways primarily aim to cover the basic needs of merchants with a global presence. Most commonly, providers offer essential services required to operate across various countries.
The downturn about them is that sometimes global payment gateways need more localisation. For example, they may fail to support crucial local payment methods of one of your key markets. It's a pity if everything else about the particular gateway suits you.
In such cases, the best solution for businesses is to work with multiple gateway providers — let's say, one offering capabilities for operating across different regions, and a few local ones, knowing specific markets well and fully covering customers' needs in those markets.
Such an approach makes managing payment processes more cumbersome, as you'll have to stay logged into all the dashboards and monitor transaction flow on each of them separately. Still, advanced technical platforms like Corefy tackle these issues efficiently, providing a single access point and a connectivity hub for all your payment and payouts, saving you time and nerves. It also allows for optimising processing costs using features like intelligent payment routing, softening the burden of gateways' fees. What's more, having extensive industry expertise and understanding the market well, we act as your payment team, helping to choose optimal partners, the best payment gateway providers and payment methods in your targeted geographies. Get in touch to learn about all the benefits of working with us.
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