A white-label payment gateway is a payment processing service that is rebranded by a company under its brand name.This enables companies to provide clients with online payment processing services without having to build the payment infrastructure from scratch.
Instead, businesses can use the technology and services of a well-known provider of payment gateways and tailor the solution to fit their needs and brand.
How Does A White-Label Payment Gateway Work?
1 Payment Processing Infrastructure: The provider of the white-label payment gateway has connections to numerous banks, card networks, and payment methods, as well as a fully operational payment processing infrastructure. They take care of the technical aspects of processing payments safely.
2 Branding and Customization: The company can brand the payment gateway solution if it wishes to offer payment processing services under its own name. This includes branding the user interface, integrating their logo and color scheme, and making additional adjustments to the design and user experience.
3 Integration: By incorporating the white label solution inside the business’s website, mobile application, or platform, clients may make payments without interruption inside the business’s walls.
4 Customer Support: Depending on the agreement, customer support could be offered by the white-label payment gateway provider or handled directly by the company.
5 Pricing and Revenue Sharing: A revenue-sharing arrangement between the company and the white label provider is customary. The revenue gained from the processing of payments is split between the two parties, and the firm may pay a setup fee and transaction costs.
6 Compliance and Security: The provider of the white-label payment gateway is in charge of making sure that the payment processing solution conforms with the rules and regulations set forth by the industry. This also involves security precautions to safeguard private consumer information.
What Are the Benefits of Using a White-Label Payment Gateway?
Benefits of using a white-label payment gateway include:
- Faster time-to-market: Without substantial development, businesses can immediately offer payment processing services.
- Brand consistency: A consistent user experience can be maintained by customising the payment system to reflect the company’s brand.
- Reduced development and maintenance costs: Businesses can avoid the expenses and hassles involved with setting up and maintaining their payment infrastructure.
- Expertise and reliability: White-label vendors often have experience processing payments and provide solid, trustworthy solutions.
What Is A Payment Gateway vs. Payment Processor?
A payment gateway and a payment processor are two essential components in the process of facilitating online transactions, but they serve different purposes and perform distinct functions in the payment ecosystem.
- The point of sale (POS) system or website of a merchant is connected to the financial institutions that process payments by a payment gateway, which functions as a kind of virtual bridge.
- Its main job is to safely send transaction data from the retailer to the payment processor before returning the transaction outcome to the retailer and the customer.
- To enable secure transmission over the Internet, payment gateways encrypt sensitive payment information (such as credit card numbers).
- They frequently offer functions like 3D Secure, address verification, and fraud detection and protection.
- Customers provide their payment information at the checkout interface, which is normally provided by payment gateways.
- A financial institution or service provider that manages the authorization, clearing, and settlement of payment transactions is referred to as a payment processor, sometimes known as a merchant acquirer.
- In order to determine whether there are enough funds and whether the transaction should be processed once a client makes a payment, the payment processor gets in touch with the customer’s issuing bank.
- The payment processor controls the money transfer from the customer’s account to the merchant’s account if the transaction is approved.
- Various backend tasks, such as batch processing of transactions, reporting, and reconciliation, are also handled by payment processors.
- Payment processors are merchant-facing, which means they operate in the background to speed up the transfer of funds.
In conclusion, a payment processor is the back-end business that permits the actual flow of funds and talks with banks to authorise and settle transactions, while a payment gateway is the front-end interface responsible for securely capturing and delivering payment information. Together, they make it possible for payments to be made easily and securely both online and offline. As part of a complete payment solution, several payment service providers provide both payment gateway and payment processing services.