What are payment gateways, and why does your travel business need them?
With the online travel market valued at just under $600 billion, you have much to gain from selling your services online as a travel provider. However, fraudsters are also hot on your heels, hoping to exploit any possible vulnerability to steal from you and your customers. Recent data suggests that the travel industry is the second-highest for suspected fraud attempts, prompting travel providers to increase security measures.
Secure payment gateways are one way you can protect your business from fraud. They provide a secure platform for online transactions and offer a wide range of benefits, such as a better customer experience, global reach and enhanced payment security.
What is a payment gateway?
A payment gateway is a technology businesses use to accept credit or debit card purchases from their customers. The term applies not only to card-reading devices found in brick-and-mortar stores but also to payment processing portals used by businesses selling products and services online.
How do payment gateways work?
A payment gateway is part of the electronic payment processing system and is responsible for sending payee information to the merchant-acquiring bank, where the transaction is processed. The multi-step process ensures the transaction is accurate and secure before processing funds.
However, payment gateway architectures differ between in-store gateways and payment portals. While in-store payment gateways rely on a point-of-sale (POS) terminal to process transactions, online payment gateways require application programming interfaces (APIs), which allow the website to communicate with the payment processing network.
Here’s how online payment gateways work: When a traveller places an order using their card information, the online payment gateway encrypts their data and sends it to the merchant’s acquiring bank. The acquiring bank then sends the transaction details to the relevant card network (such as Mastercard or Visa), and the card network forwards the request to the customer’s issuing bank. The customer’s bank either approves or declines the transaction after checking the account to determine whether sufficient funds are available and perform fraud checks.
What are the benefits of using an online payment gateway?
Payment gateways offer businesses more than just a way to accept payments. Additional benefits include:
Robust security measures, including:
PCI DSS (Payment Card Industry Data Security Standard) compliance: A set of security standards to ensure secure credit card transaction handling to reduce data breaches and fraud.
Data encryption: Data is scrambled, making it unreadable without the right key, meaning it’s safeguarded even if stolen.
Secure Sockets Layer (SSL): A standard technology for securing an internet connection by encrypting data sent between a website and a browser (or between two servers), preventing hackers from seeing or stealing any information transferred, including personal or financial data.
Tokenisation: Sensitive data is replaced with a unique code, making stolen tokens useless to fraudsters.
A seamless checkout process that minimises the steps required to make a payment. This reduces payment friction, which increases conversion rates.
Access to various currencies and payment methods, including credit and debit cards, digital wallets and alternative payment options.
A user-friendly and secure checkout process improves customer experience, boosts satisfaction, encourages loyalty and reduces cart abandonment.
How much do payment gateways cost?
Payment gateway costs vary widely depending on the provider. Many providers charge set-up fees to cover the integration cost, monthly fees (typically pay-as-you-go or tiered pricing by usage) for using the payment gateway and a small fee per transaction. Some may also charge a fraction of each purchase in addition to the fees above. Most payment gateway providers outline their pricing on their websites.
The heightened risk of fraud is concerning for travel business owners. However, with a secure payment gateway in your security arsenal, you can protect your business from fraudsters.
Secure payment gateways are just one piece of the puzzle
The travel industry has unique needs compared to many other businesses that accept online payments. Yes, they need a payment gateway to receive payments securely and efficiently, but they must also financially protect all payments. Travel businesses in the UK and EU member states must legally provide their travellers with financial protection to protect their funds if the provider becomes insolvent to comply with the UK Package Travel Regulations (PTR) and the EU Package Travel Directive (PTD).
What if you could access a secure payment gateway and financial protection in one subscription? Trust My Travel does just that. Our pay-as-you-process travel payment solution combines a merchant account, financial failure insurance and supplier payments — with no bond required.
The Trust My Travel Payment Modal allows you to process global 3D Secure transactions in multiple currencies, which helps to increase conversion rates and expand your business’s reach. Our payment gateway is also PCI Level 1 compliant, the most stringent level of security, and all sensitive card data is tokenised by a PCI-approved third-party vendor.
So, why pay for payment processing and financial protection separately? Join Trust My Travel and enjoy the benefits of a secure payment gateway and layered protection using our all-in-one platform.
Learn more about our travel payment and protection solution, or contact us to discuss your requirements.
