Monday, March 15, 2021

Payment gateway vs payment aggregator

payment gateway
What is the most important thing for a company that sells its goods online? We can talk about favorable conditions on the market, the loyalty of the company's customers, as well as other factors that are certainly important. However, the most important thing for any firm is the level of profit it is counting on.

Any company knows that to increase sales, it is necessary to provide access to many payment options and to actively attract customers. This knowledge is enough for the firm's management, they don't want to get into all the details and technical aspects of the payment acceptance process. They may not even know the difference between a payment gateway and a payment aggregator. Right now, we are going to look at the main differences between these undoubtedly most important factors for successful online payment acceptance for any company and understand how they are different.

The main difference between aggregator and gateway

The difference between a payment gateway and an aggregator is hard to notice, even for companies that have been working in the market for months but have simply decided not to delve too much into these issues.

However, the problem is that if you do not know the difference between these concepts, you won't be able to make the right choice of a payment gateway provider, i.e. a payment aggregator.

You have probably already guessed from the last sentence that an aggregator is a payment gateway provider. A gateway provides a company with only one specific way to accept payments, such as WebMoney or credit card acceptance. A payment aggregator provides a myriad of different ways to accept payments, from cash to checks, cards, e-money, etc.

Working with an aggregator, there is no need for a company to open several bank accounts and accounts with payment service providers at once. The payment gateway makes it much easier for companies to accept and process payments. The aggregator handles all the tasks related to the integration with payment providers, offering the company a single ready-made solution for accepting payments.

Another crucial difference is that a payment gateway sends a payment, but it is only a payment intermediary, i.e., it does not directly interact with the funds that the customer has paid to the company for goods.

An aggregator, on the other hand, as the name implies, accumulates the money in its own hands and then transfers it to the beneficiary's bank. The fees of the gateway and the aggregator will also be different, but it is not quite correct to compare them. In the case of the gateway, the company pays only the fee to the gateway itself, and the services of the acquiring bank are paid for separately. In the case of an aggregator, the firm will charge one rate, which will already contain both the commission of the gateway itself and the fee of the acquiring bank.

If you are interested in getting access to more features and ready-made settings at once, choose a payment aggregator. Connection in this case will be quite simple. If you choose a payment gateway, your company will have an opportunity to customize the payment service. Moreover, you will receive additional services; however, it is important to understand that the speed of the connection will be considerably lower and will require time as well as the preparation of documents.

Thus, if we summarize all the differences between a payment gateway and a payment aggregator, we may say that the main differences are the work process, connection speed, and additional conditions. If the flexibility of settings is a plus for the gateway, for the aggregator you get ready solutions with a fast connection. As for the level of risk, a gateway will have a lower risk level than an aggregator.

Choosing a payment aggregator will be absolutely the right decision because, in this case, you will get the functions of the aggregator itself as well as several payment gateways. Due to the high level of competition, you will negotiate more favorable terms of cooperation with the company.