Join us as we explore what makes each of them unique so you can better determine which solution or combination of solutions best suits your business’s needs.
Think of a payment gateway as an online point-of-sale terminal for your business. The most common use of a gateway is to authorize payments for an eCommerce store on the internet. However, today’s gateway technology enables businesses to also accept payments in a brick-and-mortar retail environment using a credit card reader, POS system, or integration with accounting or CRM software.
A virtual terminal is another method of accepting credit and debit cards, and even eCheck and ACH payments. Merchants can use a computer, smartphone, or tablet with an internet or data connection to facilitate secure payment processing.
No additional hardware or software is required, although a merchant can connect a credit card reader via USB to a desktop or laptop, if they so desire.
The functions of a payment gateway and a shopping cart are quite different. A shopping cart is a virtual equivalent to the grocery cart you wheel through your favorite store. You put your goods into the cart and drive it to the cash register that then tallies your order and gives you a total amount due.
The online shopping cart is integrated to a payment gateway, usually via an API, to complete the payment process.
An alternative to a shopping cart integration is a hosted payment form. This approach is ideal for businesses where each transaction typically has just one item or charges the same amount consistently. A secure hosted payment form can be designed to match the look and feel of your eCommerce website, yet is hosted on a third-party secure server to help reduce liability and PCI scope.
The primary difference between a virtual terminal and a payment gateway is that a payment gateway is typically used for eCommerce transactions, which means there’s a customer-facing interface like a hosted payment form or shopping cart checkout form.
Virtual terminals are typically used by merchants only. However, some businesses use both means to accept credit cards if they have a brick-and-mortar and an eCommerce presence.
Each solution offers its own advantages. A secure payment gateway allows merchants to accept credit cards, debit cards, and ACH payments online. It also enables recurring billing, accounting software integration, and more.
A virtual terminal simplifies the payment process for mail and telephone order sales, as well as off-site events. It can also help merchants save money without the need for any upfront hardware costs.
It’s easy to understand how a business owner could be confused by technical terminology if they are unfamiliar with their meanings. Many components of eCommerce and credit card processing work together. In some cases, they’re integrated as part of an all-in-one solution. Some websites and companies use these terms interchangeably, which doesn’t ease the confusion. Using the overviews outlined above can help businesses better understand their differences and find the best solution for their needs.
With Clover’s innovative processing solutions, we can help you accept payments the way your business needs to in order to grow.
Why wait? Get started with a Clover POS System today to elevate your business.
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