According to some statistics, there are online transactions worth over 3 million dollars conducted every minute around the globe. This means that eCommerce and online transactions are quite common and normal these days. This was not the case 15 years ago when people were quite skeptical about this type of transactions especially when it comes to security. Modern people are buying everyday groceries through popular sites, they are buying their clothes, booking flights, paying bills and make any other types of online transactions on a daily basis. The fact is that the number of online transactions will grow in the near future. But, have you ever asked yourself how they work?
The main element in this activity is the third party payment gateways. The vast majority of online stores today rely on well-established third party payment gateway providers who are focused on managing payments. They use them to manage their online transactions and get payments from their clients. They also use local credit cards and debit cards.
It is worth mentioning that there are domestic and international payment gateways. The domestic payment gateways usually have special deals with domestic banks and other financial institutions with low fees. In addition, there are international payment gateways which are popular because they allow international online shopping. Online sellers that are focused on international buyers should allow online transactions via popular gateways like Paypal, Skrill, Neteller and Payoneer.
So, the online transactions are managed by these third party payment gateways. It is their job to authenticate and verify the information provided by the buyer through his debit/credit cards or online payment processing providers. The online store won’t have access to the personal information of the buyer.
The third party payment gateways provide APIs that must be used by online stores in order to process transactions. This represents a code that is part of the website. In this way, the website communicates directly with the servers of the selected payment gateway and process the transactions at any time of the day. The information from the credit/debit card provided by the customers is sent directly to these servers where it is checked and processed automatically.
The online stores keep the transaction ID and they can also keep the last four numbers of the credit cards of their customers. This simplifies the purchasing process whenever the buyers want to buy something again.
This is how online transactions work.
— uncova (@uncovaweb) 11 de febrero de 2016