How Do Payment Portals Work?

how do payment portals work ecommerce transactions

The global use of online payments will surpass credit and debit card usage over the next four years, possibly even by the end of 2021 or early 2022 due to the Coronavirus pandemic e-commerce impact. Many more businesses shifted to digital payments and ecommerce stores when brick and mortars were locked down or went out of business.

By 2023, approximately 1.31 billion people are forecasted to use mobile payments over a six-month period. Payment portals and gateways adoption is set to double in the US by 2025. 

Accepting payments online is a major feature of many websites, but how do pay portals work? 

This article looks behind the scenes and explains the process of collecting payments online quickly and securely. 

Payment Power

Below you will learn the differences between payment portals, payment gateways, and processors. Find out about the different gateway types and how transactions remain secure. Discover which pay portals target specific industries like health care. And how are payment becoming more frictionless while maximizing safety?

Read on to learn how a payment portal can keep you and your customers safe when paying online. 

What Are Payment Portals? 

A payment portal offers a secure means for customers, clients, and patients to make online payments using their credit or debit card. 

In the growing world of e-commerce, customers add items to their cart and then check-out. The checking-out process is often handled by a payment portal. Customers submit their card details, name, and address, and the portal handles the transaction. 

In the healthcare industry, pay portals act in a similar way to a shopping cart. 

Patients visit their doctor's website or a dedicated page to pay for their procedures and prescriptions. All data gets encrypted to ensure Patient Health Information (PHI) confidentiality. The patient can then view all their past transactions on the secured screen for full payment history. 

Pay Portals and Payment Gateways 

Payment gateways and portals are often used as interchangeable terms. Yet there is a slight difference between these two terms. 

A payment gateway acts as the technology behind the security. It ensures the safe transfer of sensitive information like a credit card number or CVV. 

Gateways also process card payments through a merchant service account. They request authorization from credit and debit card companies and process those results. Once accepted, the gateway returns a successful transaction code that the website can display to the customer. 

Payment Gateways Versus Payment Processors 

Payment processors analyze and transmit transactional information. Yet they don't authorize the transfer of funds between the seller and buyer. 

A payment gateway includes both services. 

Types of Payment Portals 

Three types of payment portals exist for online sellers to accept payments: 

1. Redirect services 
2. Off-site payments 
3. On-site payments 

A redirect service takes the customer from the seller's website to the processor's website. 

PayPal is an example of a redirect service as it processes payments on Users get transferred and have the option to log in or enter their card details. However, some people find this confusing and abandon their checkout as a result. 

On-site and Off-site portals keep the customer on the seller's website. Instead of being redirected to a third-party site, they enter their card details on a familiar screen. 

The difference between the two is where the processing takes place. 

Off-site payment portals process payments behind the scenes. The payment details get sent securely to a third-party who then returns the authorization status. The seller must use an SSL secure connection, which we'll discuss shortly. 

Large enterprises use on-site payments as they process payments themselves. They have full control over every detail but the system is extremely costly to maintain. 

Integrating Payment Portals 

How do online payment portals work on existing websites? 

Depending on their website platform, online sellers can add a payment portal in a few steps. For example, Shopify merchants can add payment gateways through their Shopify Payments service

They require an Employer Identification Number (EIN) and their bank details. Once added, Shopify lets customers in the US pay by: 

• Visa 
• Mastercard 
• American Express 
• JCB 
• Discover 
• Elo 
• Diners Club 

WooCommerce can integrate with 100 payment gateways by installing the right extension. 

WooCommerce Payments is a dedicated payments service designed specifically for the platform. It's free to install and merchants only pay the transaction fees. 

Wix users must upgrade their site to the Premium Plan to accept payments. 

The admin dashboard offers several options under the 'Accept Payments' tab. From here, they can choose a payment method and click 'Connect' to use them. 

All pay portals integrate with any type of website. Read the documentation and ask for assistance to set things up correctly for web payments. 

Examples of Payment Gateways 

Some common payment gateways include PayPal, Stripe, Square, WorldPay, and 

Payment wallet processors that target mobile phone users include Apple Pay and Google Pay. Amazon also has its own payment gateway called Amazon Pay. 

Specific Industry Types 

Certain industry types can benefit from specific payment portals that are designed to fulfill a particular task. 

QuickPayPortal is known as a patient portal as it allows patients to pay for their medical bills and services online. It's fully HIPAA compliant and can be used to book appointments too. 

How Are Online Pay Portals Secured? 

Online merchants are responsible to keep their customers' data safe and reduce the risk of fraud during payment. The factors below help to ensure transactions remain secure. 

• SSL Secured 
• PCI Compliance 
• 3D Secure 
• Address Verification Service 

SSL security encrypts data sent and received from a website. That's essential when submitting card data for processing and collecting authorization information. 

To tell if a site is SSL Secured, check the lock icon on the address bar of the browser. If it's locked then the site is secure. You can also tap or click on the icon for more details. 

PCI DSS is a set of regulations created by the major payment card brands. It requires vendors to comply with 12 data security requirements. However, payment portals cover these issues so there's no cause to worry. 

3D Secure and Address Verification Service (AVS) add extra security measures. They require customers to add additional information like a password to complete their purchase. 

Payment Gateways and More at Frugal Finance 

Payment portals enable any type and size of business or seller to accept payments online.

Integrating pay portals is relatively straightforward. The main issue is deciding which service to use. 

Make sure to research transaction fees, initial charges, and the terms and conditions. Also, ensure the service offers full security at all stages of payment and authorization. 

Read more about payment gateways, fintech developments, and e-commerce transactions in our Tech section. 

We have articles on accepting online payments and selling online with secure ecommerce stores. Be sure to bookmark us as we add content regularly and check out other categories like business or finance for additional insights. Read more of our posts in the Frugal Finance and Tech sections and pay attention!

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