APIs have revolutionized payment systems and permanently changed how a customer pays. As more and more customers develop a taste for integrated, smart, and secure digital payment services, progressive businesses are looking to adopt an API-first approach to accepting payments. This is because APIs guarantee competitive advantage and make flawless payment solutions possible.
With the introduction of payment gateway APIs, modern payment gateways have made it possible for each transaction to be hassle-free, quick and secure.
Let us understand payment APIs in detail.
What is a Payment API?
An Application Programming Interface, or API, is a set of software protocols or mechanisms that enables the communication between two programs. Think of them as facilitators of seamless communication between two different software.
Sometimes referred to as a payment gateway API or payment processing API, they are used to integrate a payment solution with a different, already-existing application. For instance, it might link a business’s checkout process to a payment portal. However, the primary purpose of a payment API is to allow e-commerce businesses to manage payments effortlessly.
How does a Payment Gateway API work, and why is it important?
Merchants who desire complete control over their website’s smooth functioning of their payment process and user interface should use API-hosted payment gateways. In this scenario, application programming interfaces, or APIs, are used to process payment information and details directly on the merchant’s website.
Once the concept of a payment API is clear, it is essential to know how a payment API typically works. The working of the payment gateway API can be explained through these steps:
-
A customer starts the payment procedure by clicking “purchase now” on the merchant’s website.
-
The customer is directed to a payment gateway via the eCommerce platform, where they submit the necessary card details.
-
When the customer wishes to authorize the transaction, the payment gateway takes them to a secure website.
-
After the payment gateway has accepted the transaction, the bank checks the customer’s account to verify the required funds.
-
Once the funds are verified, the bank pays the money via the payment gateway.
-
Finally, the payment gateway settles the transaction with the retailer and notifies the customer that the transaction was successful and the payment process was successfully processed.
Is your Payment API Flexible enough?
Flexibility in payment APIs could be a critical determining factor between a suboptimal UI and a good user experience. A flexible Payment API caters to your business in the following ways:
-
A payment API’s flexibility enhances the business capabilities with various options, such as providing the ability to accept payment in different currencies or the ability to accept payment across different devices.
-
A payment API flexibility enables a business to cater to the payment preferences of its client. It includes enabling recurring transactions or offering a variety of payment options.
-
A flexible payment API can offer both single and bulk payments. These include both one-off and recurring payments.
-
A flexible payment API enables businesses to deliver a frictionless payment experience, which can help expand their customer base.
Credit Card API Integration for payment processing
A credit card transaction integration must be a component of your payment solution if your service or product offers recurring payment capabilities. Credit card API integration is essential in the following scenarios:
- A computer system that is only used by the organization doing the integration
- A software platform controlled by a SaaS development company and utilized by numerous enterprises or organizations.
- A service or a product is being delivered to end users or customers by the companies.
In these cases, accepting cash is impossible because most software-based transactions take place in card-not-present methods. Over the years, technological advancements have led to the development of reliable payment integration APIs by payment service providers. These APIs can integrate organizations and provide them with full functionality so they can create, manage, reconcile, and deliver payment notifications within their software.
Summing it Up
APIs are the primary driving force behind the massive developments in the payments sector. A tech vendor or payment platform must be able to take flexibility, speed, and cost into account to meet consumer expectations. Adopting APIs can help you achieve all of those goals.
Innoviti Technologies’s host of APIs is designed to help merchants develop solutions best fit their business. Our APIs enable your business to expand its customer base, establish trust and eventually assist your brand to create an impact in the market ecosystem.