Written by Raúl Carrión
Table of contents
When putting together an online store, one of the aspects that worries beginner entrepreneurs the most is hiring a credit/debit card payment gateway for their business. Some of them directly reject using this payment method in their stores because they see it too difficult to install, giving preference to using PayPal exclusively. In my opinion, this is not a good decision, because PayPal forces all customers who do not have a PayPal account to re-enter their contact information. This means your clients need to invest an extra time and effort when purchasing something in your store, making them lose a certain amount of trust in the transaction, which leads, in turn, to more abandoned shopping carts with “Awaiting Payment” status. This article aims to help you overcome your fear of hiring and configuring a payment gateway in your e-commerce store.
How to hire a payment gateway
Bank entities –banks and savings banks– are in charge of providing a Virtual Point of Sale (POS) service, also known as “payment gateway”. They are all very similar in terms of their service quality, as they usually share the same platform. Depending on the bank entity you decide to work with, the most notable difference there will be are the economical conditions they offer.
How much does a payment gateway cost?
Virtual POS fees usually include three independent items:
- Set-up or registration fee: it can cost up to €100 and, in my experience, it’s the easiest part to negotiate with the bank.
- Fixed monthly rate: if there’s a sufficiently large sales volume, it can be as little as €0.
- Invoice percentage: this is also negotiable when your sales increase. It is usually lower than 1%. This percentage will depend on the following two aspects:
- The extent to which we are connected to the bank entity: such as hiring additional services like insurance, payrolls, investment plans, lowest amount to be put on the account…
- Our invoice volume: the amount of money we invoice through the POS.
In general, the bigger are these two values, the more we will be able to lower the fees that are going to be applied to our online store. Nevertheless, I recommend requesting a written copy of all current conditions and how these fees are going to change depending on the sales volume our business generates, to avoid surprises.
Considering the factors that influence fees the payment gateway is going to cost us, it is usually best to hire a virtual POS through a bank entity whose services we are already using.
How to install a credit/debit card payment gateway
Once we’ve negotiated (we should always negotiate with banks) and accepted the terms for our payment gateway, the chosen bank entity will send us an e-mail with all the information required to configure a virtual POS. Let’s see the steps we’ll need to follow to do it correctly:
Step 1: access the POS dashboard and change the password
For security purposes, bank entities will ask you to access your private POS dashboard and change your password. The e-mail will describe which section you need to visit to change this.
Step 2: input your payment gateway data in the administration area of your online store
If you’re using an Open Source content management system, namely Prestashop or Magento, you will need to install a virtual POS. In Spain, Redsys provides this module for most e-commerce content management systems directly on its website. You can see the whole list of supported CMS in the following link: Download documentation and executable files.
If you’re using a custom-developed website, or you’re using a monthly-fee service like OptimizedStores or ePages, the POS module will already come pre-installed in the platform. The information you will need to enter will be as it follows:
- Business name: usually the name of your store, in capital letters.
- Business number: this is a unique number that is used to unmistakably identify your business, to facilitate its management for the bank entity.
- Terminal number: a counter in case the store has several different terminals. It is 001 by default.
- Secret encryption key: a key that will encrypt the communication between the POS and our website.
- Type of key: encryption method, in certain modules you don’t need to enter it.
We will get all this information from the configuration e-mail.
Step 3: Pre-production testing
This step includes two tests: one with an authorised purchase, and the other one with a denied purchase. In the documentation you will find a card number, its expiration date and security codes you will need to use in each test. So, in summary, you will only need to simulate two purchases with the provided card details.
These tests will be registered on our website’s dashboard, so we recommend checking it to make sure they were carried out correctly.
The last task will consist in sending an e-mail to our bank entity indicating that we’ve carried out the tests correctly and that we want to shift our virtual POS to production status.
The support team should also carry out a purchase test. To ease this process, we should send them a test user name and a password, so they can make a test-order on our store, too.
Step 4: Upgrading the POS to ‘production’
If everything’s worked out correctly, we will receive an e-mail with the new encryption key ready for the real world, and a request URL sending us to the production environment. In most modules you don’t need to manually input this URL, and there’s a simple check button indicating whether the payment gateway is in pre-production o it’s operative.
To finish the set-up process, once this information is updated, we will make a purchase with a real credit or debit card that will be authorised, and then another one that will be denied.
From that moment on, our payment gateway will be ready to receive income. The only remaining task for us will be to add credit card icons to our website’s footer, to indicate customers that our online store provides this method of payment.
