Paperless submission of documents making the whole process easy and efficientĮase of integration and mode of integrationĭifficult to integrate requires significant time and effort from the merchant’s tech teamĮasy and simple integration with minimum coding efforts. Average time for onboarding is 5-10 daysĭocumentation needs to be submitted in hardcopy, making the process cumbersome Quick approval and online onboarding process. Average application and approval cycle is around 3 months Includes documentation and approval time for PG access One time cost to integrate website with the PG Now that we know the basics of the two channels, let us see how one compares with the other: Difference between Second party vs third party payment gateway While on the face of it, third-party payment gateways seem similar to bank payment gateways, they are in fact far more user friendly, accessible and easy to integrate, especially for first time startups. This way, online businesses have the agility to accept payments through practically every online digital mode. In addition to this, many solution providers, like Razorpay, also allow merchants to process digital payments through multiple channels like prepaid digital wallets and recently, even UPI and several digital wallets. Similar to banks, these gateways also facilitate payments made through debit cards, credit cards and netbanking. Such payment gateways also collect TDR on transactions while setup costs may or may not be applicable, depending on the solution provider. Integrating with a third-party payment gatewayĪn easy and efficient way to process online payments is through a third-party payment gateway. While the whole system looks straightforward in principle, integrating with a bank’s payment gateway is often challenging and tedious for startups. The key channels are: 1) Integrating with a bank’s payment gatewayĪ payment gateway provided directly from a bank (also called a second party payment gateway) allows online businesses to process payments via debit cards, credit cards and net banking and is supported through platforms such as Visa, Mastercard and American Express, among others.įrom the cost standpoint, businesses will need to pay an initial setup fee and transaction fees or TDR (Transaction Discount Rate), which is a percentage of the transaction value for all transactions processed via the gateway. Online digital payments can be accepted by businesses through multiple ways, each with its own set of advantages and challenges.
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