eCommerce payment gateway: How to choose the right solution in Hong Kong
An easy, safe and quick eCommerce payment gateway is as important as other factors (such as UX/UI features) forming a good eCommerce website. Thus, it is essential to choose the right eCommerce payment gateway to cope up with the ever-changing trend and ensure a competitive customer experience for Hong Kong merchants.
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By Celine Nguyen
August 17, 2022
An easy, safe and quick eCommerce payment gateway is as important as other factors (such as UX/UI features) forming a good eCommerce website.
Moreover, the payment landscape has been changing along with the rising online shopping demand. According to JP Morgan’s research, credit cards and digital wallets are becoming the preferred payment methods in Hong Kong. In 2019, Nearly 50 percent of online purchases were paid by credit cards in Hong Kong. And this figure is rising.
Thus, it is essential to choose the right eCommerce payment gateway to cope up with the ever-changing trend and ensure a competitive customer experience for Hong Kong merchants.
What is an eCommerce payment gateway?
An eCommerce payment gateway is a software application or a service that processes credit cards and other sorts of payments for eCommerce businesses. It functions as same as a POS device does for a brick-and-mortar store.
The eCommerce payment gateway will encrypt payment information to ensure that credit cards and other payment instruments are protected. It transfers the encrypted data from eCommerce website/application/mobile devices to the payment processors/banks and back.
The flow of how an eCommerce Payment Gateway works is below:
Online shopper presses a “Purchase” button and fills in the necessary fields to pass the transaction data. The data is encrypted and transferred to the merchant’s web server via an SSL connection.
Merchant and eCommerce payment gateway After receiving the transaction data, a merchant passes it to the eCommerce payment gateway via another encrypted SSL channel.
The eCommerce payment gateway forwards the information to the appropriate payment processor.
The payment processor passes the transaction to a card network (Visa, Mastercard, American Express, etc.).
The card network verifies the transaction data and passes it to the issuer bank (the bank that produced the cardholder’s credit/debit card).
Issuer bank accepts or denies the authorization request. In response, a bank sends a code back to the payment processor, which contains the transaction status or error details.
Payment gateway. Transaction status is returned to the payment gateway, then passed to the website.
Customer and issuing bank. A customer receives a message with the transaction status (accepted or denied) via a payment system interface.
Issuer bank. Within a couple of days (generally the next day), the funds are transferred to the merchant’s account. The transaction is performed by the issuing bank to the acquiring bank.
Choose an eCommerce payment gateway for your store
Now, it’s time to find out how to choose the right eCommerce
It took a lot of effort to get customers to click the “Buy” button, it should be easy for them to complete the payment in no time. Thus, it is crucial to integrate the right eCommerce payment gateway.
So, how to choose the right eCommerce payment gateway in Hong Kong?
Let’s explore the 6 key factors which should be considered to choose an eCommerce payment gateway:
Fees and Service Agreement Requirements
Pay attention to the processing speed
Support your product type
Easy Integration Process
Merchant account options
1. Fees and service agreement requirements
An eCommerce payment gateway usually requires a fee for using third-party tools to process and authorize transactions.
Payment gateway pricing is frequently determined by the sort of transactions a company undertakes (online or in-person), as well as business sales, revenue stability, transaction frequency, and the markets served.
It’s critical to analyze how the business model aligns with the cost structure of the payment provider or gateway. A few providers may impose startup fees and contracts, or transaction fees if a minimum order and transaction volume aren’t satisfied.
2. Pay attention to the processing speed
Money transfers from your customer’s bank account to yours must be completed quickly. It is one of the defining qualities of an end-to-end solution.
Customer experience and satisfaction are critical for eCommerce businesses. As a result, choose the right type of payment gateway to ensure that your consumers do not experience a slow payment process.
3. Support your product type
In general, providers take into account two types of products: digital and physical.
Some payment solution companies offer services for both physical and digital products. However, it is not unusual for a system to just support one sort of product. So, before you sign up with a service, be sure that your type of product is accepted.
4. Effortless Integration Process
Integrating an online payment gateway is not a do-it-yourself project. Most payment gateways include comprehensive instructions for integrating with popular eCommerce systems such as WooCommerce.
The ideal solution is to choose a payment gateway system that does not degrade the website’s user experience by requiring a lengthy payment process. Choose a payment gateway that makes it simple and convenient for clients to make payments on your website by allowing them to choose their preferred payment method.
5. Check merchant account options
A merchant account is an agreement between a business and an acquiring bank that allows the bank to process the business’s transactions. In addition, a merchant commits to fulfill the credit card firms’ operational requirements for credit card processing.
A merchant account can be obtained from banks or payment gateway providers who provide merchant accounts as a service. Payment processors are included in this category. Consider what that company has to offer if you currently have a merchant account. Otherwise, it’s preferable to go with a service that provides a merchant account right away.
6. Mobile Payments
According to a JP Morgan report, online shoppers spent $1,4 billion on mobile eCommerce, taking 36% of eCommerce transactions in Hong Kong.
Thus, It is crucial to ensure that your eCommerce payment gateway will provide a seamless process on mobile devices. It should enable buyers to transfer money by their mobile phones, either with eCommerce apps or with a mobile-optimized site.
Most popular eCommerce payment gateways in Hong Kong such as AsiaPay, Payment Asia, WeChat Pay, AliPay support mobile transactions or digital mobile wallets.
Choosing the right eCommerce payment gateway can give a positive impact on your brand’s customer experience and profitability. Just keep in mind your business needs and the above notable factors, it is not difficult to find out the correct fit to help you collect your money.