Trend alert: A Comparative Analysis of Payment Gateways in Pakistan!

Payment gateways were introduced in Pakistan in the last decade but now all the sectors including the retail sector are getting his hands on all the new innovations that can add more effectiveness to the retail sector. With the advancement in these payment gateways, gone are the days when people used to rely on international payment gateways. We have quite effective payment gateways working in Pakistan now and people are using them like anything. Payment gateways have played a significant role in boosting e-commerce in Pakistan and every sector including retail is getting benefited from it.

Evolution of payment gateways in Pakistan:

Online shopping was an expensive thing in the early days due to a lack of options in terms of payment gateways due to the non-availability of diverse payment gateways. This is one of the many reasons why companies switched to the cash on delivery approach because customers felt that they were more comfortable that way. Back in 2013, a local payment gateway was introduced by UBL in 2013. It was launched in collaboration with Etisalat. It remained the only option for a long time but it was not as successful as it was thought to be. At the moment, there are other competitors in the market as well that include HBL, MCB and EasyPaisa and UBL.

Different fraud management tools are used by companies to enable their customers to make safe transactions. If a merchant does not use an effective payment gateway, there is a probability that the data of their customers might get hacked at some point. This consequently can affect the relationship that a customer has with a brand. Information within the payment gateway undergoes some important stages.

In this article, you will learn how an online payment gateway works.

• Completing order:

In the first stage, the customer fills the payment form placed on the website of the seller and then fill the payment details. Once all the details are filled, the customer sends it to the receiving end by clicking on the “okay” option.

• Information received:

In this stage, the seller gets all the information sent by the customer. The seller transfers all these details to the payment gateway.

• Authorization request:

When data is received at the payment gateway, it is transferred to the bank through payment card information. The bank then sends an authorization request to the IPS. In this phase, the credibility of the card is closely monitored. It is ensured that the provided information is authentic and no fraudulent activity is involved.

• Subtracting the amount from the card:

Once this process has been completed, the payment gateway requests the bank to deduct the required amount from the payment card so that the customer can pay for the service. After the amount is deduced, the system sends the information to the IPS and bank.

• Checking balance:

In the next step, the bank monitors the current account balance of the customer and in case of adequate balance, the bank performs a transfer and a confirmation message is delivered to IPS.

• Confirmation of the transaction:

In this stage, IPS confirms that payment has been made successfully and sends this information to the payment gateway.

• Successful transaction:

In this stage, the seller gets to know that payment has been made successfully within 10 to 15 minutes. The information provided by the customer is secured through different techniques. The customer is ensured that the data provided by him will never be exposed and is completely safe.  

Types of payment gateways:

There are different types of payment gateways and people choose one while keeping in view their requirements and needs. Here are a few types of payment gateways:

• UBL:

UBL has no transaction fee and is considered a pioneer in this regard.

• MCB:

MCB uses the hosted services provided by MasterCard’s MIGs to let ‘card not present’ transaction. MCB uses great application which ensures that your data is in safe hands.

• HBL:

Considered to be the largest bank in Pakistan, HBL has joined forces with VISA employing their hosted payment application. HBL also uses a robust application that ensures your data is in safe hands.

• EasyPaisa:

It has launched EasyPay which is a local payment gateway application. EasyPay offers various options for payment. The overall processing is done fast and it is also safe to use this payment gateway. It is an amazing option for early startups. It has no upfront payment and has a quick settlement period which makes it the best option in terms of e-commerce.

• 2Checkout:

2checkout is used in Pakistan as an alternative to Paypal. It works as efficiently as Paypal. This is a renowned payment method with low MDR.

• Jazz Cash:

Many online businesses use jazz cash as it enables customers to make transactions easily. The best thing about jazz cash is that it is safe to use and is customizable.