A Step-by-Step Guide to Setting Up a White Label Payment Gateway
- Pooja Yadav
- Sep 11, 2023
- 5 min read
Updated: Jul 31, 2024
In the vast landscape of payment gateway services, one term that often emerges is 'white label payment gateway.' But what exactly does this entail? How does it benefit from traditional payment gateways, and who stands to benefit the most from its utilization? If you're pondering these questions, you've landed in the right place.
In this blog post, we'll dive into the world of white-label payment gateway.
Table of contents:
What Is A White Label Payment Gateway?
A white-label payment gateway is a payment processing service that is rebranded by a company under its brand name. This allows businesses to offer online payment processing services to their customers without developing the payment infrastructure from scratch. Instead, they can leverage the technology and services of an established payment gateway provider and customize the solution to match their brand and requirements.
What Are The Features Of White-Label Payment Gateway?
Now that we are equipped with the general idea of ‘What Is A White Label Payment Gateway?’, let the secured features provided by PayNet Systems take you forward in your journey of White label payment gateway creation, with 10 times faster speed:
Branding Customization: Maintain your brand identity by customizing the payment gateway to reflect your company's aesthetics.
Enhanced Security: Our solutions come equipped with top-notch security features to protect both you and your customers.
Multiple Payment Methods: Accept a wide range of payment methods, from credit and debit cards to digital wallets and more.
Check out PayNet's other unique White Label Payment Gateway features here.
How Does A White-Label Payment Gateway Work?
Payment Processing Infrastructure: The white-label payment gateway provider has a fully functional payment processing infrastructure that includes connections to various payment methods, banks, and card networks. They handle the technical aspects of securely processing payments.
Branding and Customization: The business that wants to offer payment processing services under its brand can customize the payment gateway solution. This includes branding the user interface, incorporating their logo and color scheme, and making other design and user experience customizations.
Integration: The white label solution is integrated into the company's website, app, or platform, enabling customers to make payments seamlessly without leaving the company's environment.
Customer Support: Depending on the arrangement, customer support may be provided by the white-label payment gateway provider, or the business may handle customer inquiries and support itself.
Pricing and Revenue Sharing: The business and the white label provider typically have a revenue-sharing agreement. The business may pay a setup fee and transaction fees, and the revenue generated from payment processing is shared between the two parties.
Compliance and Security: The white-label payment gateway provider is responsible for ensuring that the payment processing solution complies with industry standards and regulations. This includes security measures to protect sensitive customer data.
What Are the Benefits of Using a White-Label Payment Gateway?
Benefits of using a white-label payment gateway include:
Faster time-to-market: Businesses can quickly offer payment processing services without the need for extensive development.
Brand consistency: The payment solution can be customized to align with the company's brand, maintaining a consistent user experience.
Reduced development and maintenance costs: Companies can avoid the costs and complexities associated with building and maintaining their payment infrastructure.
Expertise and reliability: White-label providers are typically experienced in payment processing and offer robust and reliable solutions.
Who Can Benefit From Using White-Label Payment Gateway?
A White-label payment gateway can benefit a wide range of businesses and organizations across various industries. Here's a breakdown of who can benefit from using these solutions:
E-commerce Platforms: White-label payment gateways can be used by online retailers and e-commerce to offer their customers an intuitive and unique payment process. This helps boost conversion rates, reducing cart abandonment, and increasing overall sales.
Software as a Service (SaaS) Providers: SaaS companies that offer subscription-based services can use white-label payment gateways to handle recurring payments and billing for their customers. It simplifies the payment process and enhances user experience.
Financial Institutions: Banks, credit unions, and other financial institutions can offer their customers white-label payment gateway solutions to facilitate online banking, bill payments, and fund transfers. This extends their digital banking services and enhances customer satisfaction.
Startups: Startups with limited resources can quickly enter the market and accept online payments by partnering with a white-label payment gateway provider. It reduces the development time and costs associated with building their payment infrastructure.
Small and Medium-sized Businesses (SMBs): SMBs in various industries can benefit from the affordability and scalability of white-label payment gateways. They can easily integrate these solutions into their websites or apps to accept payments from customers.
In summary, white-label payment gateway offers flexibility and scalability, making them suitable for a wide array of businesses and organizations seeking to streamline payment processing, enhance the user experience, and expand their services.
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.
Payment Gateway
A payment gateway is like a digital bridge between a merchant's website or point of sale (POS) system and the financial institutions that handle payments.
Its primary function is to securely transmit transaction data from the merchant to the payment processor and then return the transaction result to the merchant and the customer.
Payment gateways encrypt sensitive payment information (such as credit card details) to ensure secure transmission over the Internet.
They often provide features like fraud detection and prevention, address verification, and 3D Secure.
Payment gateways are customer-facing and typically provide the checkout interface where customers enter their payment information.
Payment Processor
A payment processor, referred to as a merchant acquirer, is a financial institution or service provider that handles the authorization, clearing, and settlement of payment transactions.
When a customer makes a payment, the payment processor communicates with the customer's issuing bank to verify if there are sufficient funds and if the transaction should be approved.
If the transaction is approved, the payment processor manages the transfer of funds from the customer's account to the merchant's account.
Payment processors also handle various backend processes, including batch processing of transactions, reporting, and reconciliation.
Payment processors are merchant-facing, meaning they work behind the scenes to facilitate the movement of funds.
Drawbacks of a White-Label Payment Gateway?
Dependency on the third-party provider: Businesses using a white-label payment gateway are reliant on the third-party provider's infrastructure, which can lead to issues if the provider experiences downtime or technical difficulties.
Limited customization options: White-label payment gateways often offer limited customization options compared to developing a custom payment solution.
Cost considerations: While white-label solutions can offer cost savings compared to developing a custom payment gateway from scratch, there may still be associated fees, such as licensing or transaction fees, that need to be considered.
In summary, a payment gateway is the front-end interface responsible for securely capturing and transmitting payment information, while a payment processor is the back-end entity that facilitates the actual movement of funds and communicates with banks to authorize and settle transactions.
Searching for a system that creates your White Label Payment Gateway according to your Branding? Look no further. Let PayNet Systems assist you with their customizable systems, uniquely available on the SaaS Pricing model.
Informative article