Credit Card Payment Integration: How to Integrate Payments into Your Website and Point of Sale

Customers are increasingly curating their shopping experience based on their own terms. 

Up to 42% of shoppers in the US abandon their cart if their favorite payment method isn’t available. Meanwhile, retailers that provide at least three of the most popular payment methods in any market increase their conversions by up to 30%.

As an independent software vendor (ISV) or eCommerce platform, these statistics mean that you should focus on function when developing products for your clients. One way to do this is by offering credit card integrations.

In fact, integrating payment capabilities into products that businesses use to conduct their operations can help SaaS providers address $35 trillion in payments annually.

Starting the payments journey can be an uphill task for software companies and eCommerce platforms. The good news is that the challenges aren’t too great to overcome, plus getting it right offers numerous benefits.

Here’s what companies need to know about credit card integrations and how they can handle payments.

TL;DR

• Online payments rely on API or hosted gateways with encryption and fraud detection, while in-store transactions require POS hardware with EMV chip technology and NFC capabilities.
• Need to integrate payments? Choose a reliable payment gateway, decide between API or plug-and-play solutions, set up a merchant account (if needed). From there, configure your settings, and test transactions for security and functionality.
• Some of the key features to look for in a provider are multi-channel support, reporting tools, and recurring billing capabilities.

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Understanding credit card payment integration

Credit card payment integration is when a merchant’s point-of-sale system (for in-store sales) or website (for eCommerce sales) is integrated with a payment processor for seamless transactions. This allows customers to pay using different payment methods, such as credit and debit cards, without being redirected to an external payment gateway or being compelled to enter payment details manually.

Once a customer initiates a transaction, their payment details are sent to a B2B, B2C, or C2C payment gateway. The data is then submitted to a payment processor, which directs the payment to a credit card interchange. 

The issuing bank verifies whether the customer has enough funds in their account to complete the transaction. Once approved, the information is sent to the merchant’s bank account, where the funds are deposited.

At each step of the process, the participants charge a small fee, ranging from 10 cents to almost two dollars, which ultimately adds up to about three dollars for the entire transaction.

Online vs. in-store payment integrations

There are two types of payment integrations—online and in-person. While the fundamental payment processing steps are similar, the integration processes differ.

Online payment integration requires embedding a payment gateway application programming interface (API) or using a hosted payment page. Due to the sensitive nature of online transactions, these integrations often rely on secure encryption (SSL/TLS) and fraud detection tools like 3D secure authentication. 

On the other hand, in-person payment integration requires POS hardware, such as card readers and NFC terminals, that connect with the payment processor. For enhanced security, it uses EMV (Europay, Mastercard, and Visa) chip technology and contactless payments, like Apple Pay and Google Pay. 

How to integrate credit card payments into your website

Integrating credit card payments into your website is straightforward, with several easy steps. However, the process can change depending on the particular payment gateway you’re using and the website’s platform.

Here’s a step-by-step guide:

Choosing the right payment gateway

You must select a payment gateway that matches your business needs and requirements. Consider the following factors to ensure you choose the right payment gateway:

• Infrastructure – Look for a payment gateway with a stable, reliable infrastructure that streamlines customer experience, business operations, and revenue flow. Ensure it also meets your current business needs and accommodates future growth projections. Ask how often interruptions occur. Does the payment gateway automate all payment transactions? 
• Ease of integration – You need to integrate the payment gateway to your website seamlessly. This can vary depending on the payment gateway and your website’s platform. Some eCommerce platforms like Shopify and WooCommerce offer plugins and extensions to make integration straightforward. Otherwise, check whether the payment gateway provider offers an API key to help manually integrate the gateway to your website.
• Supported payment methods – Different customers have different preferred payment methods. Consider the variety of payment methods the gateway accommodates. Check for options like credit and debit cards, digital wallets (Apple Pay, Google Pay, etc), and Buy-Now Pay-Later (BPNL). The more options, the better.
• Transaction fees – Payment gateway fees vary from provider to provider. While you might be inclined to choose the lowest option, it might prove costly in the long run if there are hidden additional fees for maintenance or setup. Check whether the provider is transparent about the transaction fees and fee structure.
• Settlement period – The length of the settlement period can significantly impact your customers’ cash flow. Some providers offer a three-day settlement period and others have instant settlement. A shorter settlement period helps your users access business funds faster. 
• Customer support – Payment gateways don’t always run smoothly. You want a provider that offers prompt support in case of disruptions. Also, evaluate the quality of customer service you receive. Check whether the customer support team is available at all times on multiple channels, such as phone, email, and live chat.

API vs. plug-and-play solutions

There are two primary types of payment gateways for you to choose from, namely API and plug-and-play solutions.

API solutions

API or direct integration solutions enable payments directly on an online store or website without redirecting the users to a separate platform to complete the transaction. Direct integrated gateways use an API to integrate payments into your website’s cart.

Since API solutions allow for direct payments, the transactions are typically faster than hosted gateways. However, you’ll need to ensure that transactional security protocols are in place.

Direct API integrated solutions are more suitable for SaaS companies that want seamless, branded checkout flow with advanced customization.

Plug-and-play solutions

Plug-and-play solutions, also known as hosted payment gateways, redirect customers to a separate, hosted payment platform. The payment provider is responsible for hosting and managing the gateway.

While they typically take longer to complete transactions since customers are redirected to a third-party platform, they’re generally easier to integrate with eCommerce sites. 

Plug-and-play solutions are suitable for growing software businesses with limited development resources.

Step-by-step guide to integrating payments

Once you’ve selected the type of payment gateway suitable for your business, follow these steps to integrate payments into your website:

• Setting up a merchant account (if required) – Some payment gateway providers offer an all-in-one solution with a built-in merchant account while others require you to set up a merchant account. If necessary, you need to apply for a merchant account through a bank or payment processor. You’ll be required to provide business details, such as company registration, financial history, and expected transaction volume.
• Connecting the payment gateway to your eCommerce platform – This process varies depending on the gateway provider and your eCommerce platform. For example, WooCommerce supports integrations via plugins, while Shopify provides built-in support for multiple gateways. On the other hand, Magento requires API integration or plugins for most gateway providers. If there are no plugins and API support, you might have to manually add code to your software.
• Configuring payment settings and testing transactions – You can conduct various tests to check whether your software or eCommerce platform can now process credit card payments seamlessly and securely. Perform real transactions and see how long it takes for the money to reach your merchant account. This ensures everything is working correctly before going live.

Security considerations

Security is vital when dealing with sensitive credit card details. Implement SSL (Secure Sockets Layer) encryption to ensure secure data transmission between your website and payment gateway.

Also, check for compliance with PCI requirements, which protect cardholder data and implement robust access control measures.

Additional layers of protection include tokenization to reduce fraud risk and fraud prevention measures, such as CVV verification, 3D secure authentication, and address verification (AVS).

How to integrate credit card payments into your point of sale (POS)

POS payment integration connects your payment processing system with your POS hardware and software. A well-integrated system allows businesses to accept multiple payment methods, sync transactions with inventory and accounting software, reduce manual errors, improve transaction speed, and provide secure payment processing.

Before integrating credit card payments into your POS, you need to understand the difference between cloud-based and traditional POS systems:

• Cloud-Based POS Systems – Also known as web-based or Software-as-a-Service (SaaS) POS. These POS systems are web-hosted and store data on remote servers. Your users can access the data from anywhere with an internet connection. These systems offer easy integration with eCommerce platforms and inventory management systems. If you offer cloud-based POS systems, your customers get automatic updates and security patches. Also, you likely operate on a SaaS model, where businesses purchase a subscription-based license. Examples of web-based POS systems include Square, and Lightspeed.
• Traditional POS Systems – Also known as legacy or on-premise POS, these systems operate on closed internal networks and store data on physical hard drives. In other words, the transaction data is stored on the store premises. The owner must be on-site to enter, analyze, and retrieve data from the local server. These systems offer more advanced hardware support for high-volume sales. Examples of legacy POS systems include Verifone and NCR.

That said, let’s look at how to integrate payments with POS systems

Steps to integrate payments with a POS system

Follow this step-by-step process to integrate credit card payments with your POS system:

• Choose a compatible payment processor – Many POS systems have partnerships with popular payment processors. This makes the integration smoother. When choosing a payment processor, consider their compatibility with your POS system, processing fees, and security features.
• Set up payment hardware – Your POS system customers may have different hardware needs. Those using traditional POS terminals may need fixed credit card readers for in-store payments. Mobile POS (mPOS) device customers need wireless readers for mobile payments. They might also need contactless/NFC readers to accept Google Pay, Apple Pay, and tap-to-pay cards.
• Configure the POS software for payment integration – Once the hardware is set up, integrate the payment processor with your POS system. You might have to integrate via API keys or plugins. Also, enable the payment methods your customers want to accept (credit, debit, contactless, BPNL, etc)
• Ensure compliance with EMV and contactless payments – Ensure the POS supports chip-enabled payments to prevent fraud and NFC-enabled for contactless payments. Keep in mind that non-EMV-compliant merchants are liable for fraudulent transactions, so always use EMV-certified terminals.

Key features to look for in a payment integration solution 

Choosing a good payment integration solution is more than just another business decision. It’s a vital factor in creating a seamless and secure experience for your software customers. That’s why you need to get it right.

Here are five key features to look for when choosing a payment solution:

Multi-channel support

It’s becoming increasingly rare for merchants to focus on only one channel for their business activities. According to WinSavvy, 56% of companies sell their products or services through a combination of their physical stores, online marketplaces, social media platforms, and their own websites.

An integrated payment solution should allow your SaaS customers to accept payments on multiple channels, such as online, in-store, and mobile payments. Find a solution that brings together in-person/EMV payments, eCommerce sales, and mail and phone orders. 

Even if your customers don’t need all these options now, it’s nice to have some flexibility in a solution that allows them to add those options in the future.

Recurring billing and subscription management

Since you run a subscription-based business, you need to find a payment gateway that streamlines recurring billing and subscription management. The gateway should allow you to easily and securely save and store your customers’ payment information to enable automatic recurring billing on preset schedules.

The subscription payments should be automated based on customizable billing cycles (weekly, monthly, quarterly, etc). The provider should have subscription management tools that allow for upgrades, downgrades, and cancellations.

Also, check for dunning management to manage and automatically retry failed payments.

Multi-currency support and global transactions

As your business grows, you might attract international SaaS customers. This calls for a payment gateway that makes cross-border sales seamless.

Look for a payment integration platform that offers multi-currency support and automatically converts currencies to display prices in the customer’s local currency. It should offer global card network support for companies like Visa, Mastercard, American Express, and others.

Check whether it provides local payment options for your international clients. For example, if you have customers in China, your payment gateway should accept UnionPay for clients paying using credit cards and Alipay for clients using digital wallets.

Reporting and analytics tools

Comprehensive reporting and analytics are vital for monitoring your SaaS business’s financial performance. A good payment integration solution should provide real-time insights into transactions, customer behavior, and revenue trends.

Check for detailed transaction reports with filtering and export options, chargeback and dispute tracking to monitor potential losses, and customer spending insights to help you optimize your pricing and marketing strategies.

Common challenges and how to overcome them

While integrating payment gateways is a smart business decision, SaaS companies often face technical, regulatory, and operational challenges when implementing these solutions. 

Below, we discuss these common hurdles and how to address them effectively.

Technical issues and integration complexity

Payment integration is a bit technical. Connecting eCommerce, POS, and accounting systems can be an uphill task. 

Common technical issues businesses face during payment gateway integration include API incompatibility, downtime due to improper configurations, and payment gateway errors affecting transactions.

To overcome this issue, choose the right integration method and opt for plug-and-play and API-based solutions. Choose a provider with plugins and pre-built SDKs.

Also, test the payment gateway in a sandbox environment before launching the system to spot and solve any issues beforehand.

Managing chargebacks and disputes

Chargebacks occur when customers dispute a payment and request a refund from their bank. High chargebacks can lead to financial losses to refund fees, damaged merchant reputation, and potential blacklisting.

Ensure your payment gateway has fraud detection tools in place to flag any suspicious transactions. Provide transparent billing descriptors to ensure your customers understand the transactions. Have easy refund policies and prompt dispute resolution in place to avoid escalations.

In addition, maintain a record of invoices, shipping confirmations, and customer agreements to challenge fraudulent chargebacks.

Handling multi-platform payment synchronization

Most businesses operate both online and in-store. Without proper payment synchronization, you risk mismatched inventory levels, duplicate transactions, missing payments, and accounting discrepancies.

Always go for a unified payment system with omni-channel support. Enable real-time data syncing for seamless tracking and regularly audit your payment reports to catch any discrepancies early.

Conclusion

Businesses now look at their physical and online channels as a unified retail system. Not allowing their customers to purchase directly from their online stores is just like turning them away from their physical stores.

As a SaaS company, eCommerce platform, or POS provider you need to provide integrated payment solutions for your customers. 

But you also need to partner with a platform that allows you to provide payment processing services to your users. This is where Stax Connect comes in.

Our solution offers a branded white-label experience through a single API integration, eliminating hurdles that could limit payment integration on your end. Contact us today and unlock a seamless experience for your merchants and their customers.

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